Car insurance is something which anyone operating a vehicle on the road should have, but finding the best auto insurance which delivers great coverage, is affordable and boasts a team of customer service-oriented agents is no easy feat.
What individuals may need from their car insurance may vary from state to state and one driver's personal comfort level to another. But there are steps which anyone can take today to seek and find the best auto insurance for his or her specific needs.
Before You Start Shopping
Before you begin to look for the best auto insurance, drivers must keep in mind that there are steps which they can begin taking now and into the future which can drastically reduce the premiums they pay for even the best auto insurance. The first and most surprising to many drivers is:
Maintain a Good Credit Score
A lot of drivers on the road are under the misconception that their auto insurance rates are primarily affected by how clean their driving record is. Sadly, this is only one of the many factors which your auto insurance agent will take into account when calculating your premium. Another important factor which they consider is your credit score (unless you live in Hawaii, California or Massachusetts, the only three states which do not allow insurance credit scoring).
What makes this process even more confusing is that your FICO score is not necessarily the credit score which your insurer will use. In fact, each auto insurance provider may use a different rate-setting formula.
You can begin maintaining a better credit score today by:
- Paying bills on time;
- Regularly checking your credit report for errors (ask to be re-scored once a year); and
- Keeping your credit balances low.
Also, if you have suffered from an extraordinary life circumstance such as death, divorce or military deployment, you may be eligible for an extraordinary life circumstance exemption.
Drive Less to Save More
The less you drive, the more you can save on your car insurance. If you have recently changed jobs and are driving fewer miles, or if you have retired and no longer need to make that daily commute into the city, let your insurance company know. You may be able to instantly save 5 to 10% off of your insurance premiums.
Be Smart about the Car You Buy
Different cars will have different premiums set for them. If you are on the market for a new car and want to know how each will affect your premiums, make a list and bring it to your insurance agent. He or she will be able to advise you on what premiums you can expect to pay for each make and model of vehicle.
Let the Auto Insurance Shopping Begin!
When you have considered the above factors, it is time to start shopping around for the best auto insurance. You will want to pay particular attention to two things:
a) The company's reputation; and
b) The company's financial standing.
Start your search by looking up an insurance company of interest on your state's Department of Insurance website. On this website, you will be able to see if the company is licensed to sell insurance, and you may also be able to see the insurance company's complaint ratios.
The next consideration is the company's financial standing. Never assume that an insurance provider will be able to provide you coverage simply because that is the business they are in. Make sure that the insurance provider you are considering will be able to pay your damages promptly and whenever necessary.
The final action to take is to see how the company stands with the Better Business Bureau or the BBB. The BBB maintains updated information about insurance companies and ranks them from A+ to F. You will be able to find a lot of useful additional information, including how long the insurance company has been in operation and what kinds of complaints have been lodged against the company (and if those complaints were resolved).
How to Properly Compare Policy Prices
In order to find the best auto insurance policy, it is imperative that you compare quotes from not one, not two, but several different insurance providers. At a minimum, drivers should receive three separate quotes from three different companies. This can easily be done online, though be sure to also check in with friends and family members. Ask them about whom they have used, how long they have been with them and how happy they are with the service. Be sure to also ask about rates and how frequently they have been increased over time.
Other important items to consider when comparing the best auto insurance policies include:
- Discounts: Some insurance companies will offer discounts, such as if you drive under a certain amount of miles each year or if you outfit your vehicle with an anti-theft device;
- Good Driver Reward Programs: Many insurance companies reward consistently good drivers by annually reducing their premiums, with many drivers being able to save 40% or more on their insurance premiums;
- Bundling Policies: If you currently have other types of insurance, such as renters or homeowner's insurance, you may be able to bundle the two with your current provider for additional savings.
Keep in mind that cost should never be the only factor to consider when looking for the best auto insurance policy. Narrow your selection to only top-rated insurers who will use high-quality parts on your vehicle and will not send you time-consuming low-ball estimates.
The Best Auto Insurance Policy Today May Not Be the Best Tomorrow
All motorists should keep in mind that what may be the best auto insurance policy for them now could very well change in the next two to three years. Consumer Reports recently revealed that 75% of consumers have not shopped around for their auto insurance in the previous year. This may cause you to lose hundreds if not thousands of dollars over the next 5 to 10 years.