How to Compare Auto Insurance

Insurance providers offer several plans in the auto category. You should choose your options wisely when buying auto insurance. Comparing different policies can be easier when you are sure about the kind of coverage you need. You can compare different insurance plans based on your age, driving history, your current location and the type of your auto. Here is how to compare auto insurance policies.

Difficulty: Moderately Easy

Instructions

1. Assess your needs. Get your car inspected before you consider comparing different auto insurance plans.

2. Go online and search for top companies offering auto insurance. There are several Web sites that provide information about insurance providers. Find out the kinds of coverage and premiums that these companies offer. Alternately, talk to your local agents and get quotes on several policies.

3. Compare prices. Evaluate the prices for similar coverage offered by several insurance companies. Bear in mind that the cheapest insurance is not necessarily the best. However, the cheaper it costs you to get a policy, the better you may feel about owning and driving a car.

4. Understand the kind of coverage available on your car. Insurance companies offer different plans with specific names. The most common policies are Liability, Collision, Comprehensive, Medical, Uninsured and Underinsured Motorist, Personal Injury Protection (PIP) and Rental Reimbursement. Choose the right plan based on your specific requirements.

5. Look for exclusions in each insurance plan. Upon receiving a number of quotes, you can compare each for exclusions or special clauses to determine which quote is best.

6. Look for limits on each kind of coverage. Limits may vary depending on the insurance provider, state and city of your residence and, most importantly, the car you are insuring.

7. Be flexible with deductibles on your policy. Ask how your premium will change if you choose a higher or a lower deductible.

8. Compare policies based on the ratings of the insurance companies.

9. Compare different policies for the same car. Changing car models or comparing different policies for different cars will give you an inaccurate analysis.

10. Ask local agents about discount schemes that depend on your driving history and "no claims." Choose the company that considers these factors and offers higher discounts with adequate coverage.

Tips & Warnings

• Adding other members of your family to a single policy will affect your premium rates. Make sure you finalize the type of policy and the number of people to include before buying the policy.
• Make all comparisons on a basis of annual policies. A short-term or six-month policy may have different sets of criteria and rates.
• Each carrier has promotional offers for limited periods. Do not use old comparisons. Ideally, you should shop for best insurance rates every six months and be prepared to switch. Sometimes, renewing a policy with the same company may prove expensive. Make sure you revise and update your comparisons regularly.