How to Compare the Market Insurance
One of the advantages of a competitive market for insurance is that consumers have many options. One of the disadvantages is that the selection is so wide that it can be confusing, even intimidating, to start making meaningful comparisons. Like most financial decisions, making comparisons in the insurance market works best if you approach it in an organized, step-by-step fashion. Although different types of insurance have different features, the basic process is the same.
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Instructions
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Compare only like policies at any given time. Shop and compare life insurance policies, then move on to auto, or vice versa. The important point is to handle the tasks one at a time so you don't confuse the "apples" with the "oranges."
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Begin your analysis with the limits of coverage. Compare only policies with similar coverage limits. For example, a $250,000 policy will naturally be less expensive than a $100,000 policy. Comparing them together would be essentially meaningless. It's okay to compare different price ranges, just not against each other.
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Check the deductible, co-payment and co-insurance for each policy. A deductible is an amount of money you pay out of your pocket with each incident that requires your insurance. High deductibles usually mean lower premiums.
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Note exclusions on each policy. Exclusions are circumstances under which a policy will not pay the listed benefit. For example, your homeowners policy won't pay out if you burn your house down on purpose. You may find that an inexpensive policy lists exclusions that are actually likely to happen, making the policy a worse deal than one that didn't list those exclusions.
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Consult with an expert or consumer guide for the specific insurance type to find other major considerations. For example, breakdown of coverage limits is important to auto insurance, but not to life insurance.
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Choose the least expensive of similar policies that best suit your needs. Check the insurance provider for those policies with AM Best. Best is a watchdog group that rates insurance companies based on their financial stability and ability to pay claims. As a genera rule, opt against using companies with lower than an "A" rating.
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Tips & Warnings
You can often get good deals through your existing insurance company, since most companies offer discounts for carrying more than one policy with them.
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