If you’re typical, you’re probably struggling with money. Even though the Great Recession has ended, most people are still having a hard time making ends meet. You might find it difficult to save money on staples such as groceries or housing but you could spend just one hour online and put hundreds of dollars into your pocket by shopping for your auto insurance.
Get three quotes
The first important thing in shopping for auto insurance is to get at least three quotes from different insurers. This may surprise you but you can get very different quotes from different insurers. All these companies have their own pricing strategies. For example, some put more of an emphasis on your driving record while others might give more weight to your location, type of car or credit score.
Make sure you’re comparing apples to apples
You can’t really compare quotes from different insurance companies unless you make sure you’re getting the same coverage from each of them. When you request quotes, you need to specify identical limits for liability, uninsured motorist coverage and medical payments for all three insurers. You might also decide to have a $250 deductible on physical damage coverage.
Remember to ask about discounts
You’ve probably seen the TV commercial where the little kid with the cheese head yells, “discount double check!” The commercial might be funny but the idea behind it isn’t. You need to learn from all three companies the discounts they offer. There are many different discounts available such as a discount for insuring multiple automobiles with the same company, insuring both your automobile and your house with the same company, the number of miles you drive each day and so forth. For that matter, some insurance companies are now offering special discounts if you allow them to track your actual performance like your number of hard stops, speed, acceleration and time of travel.
Are all insurance companies the same?
In most states, there are regulatory agencies that evaluate and approve auto insurance policy language. This means that the coverage language is usually pretty consistent within a state. But the way that the insurance companies interpret that language and how they settle claims can vary significantly. Some insurance companies have incredible reputations for their claims service while others do not. You can check out how various insurance companies handle claims and their customer service in general as provided by Consumer Reports magazine.
How often should you switch insurance companies?
As a general rule, you should probably get new quotes every three years. If you shop annually, this can be overkill. Plus, some insurance companies reward customers who are loyal. Beyond that, it’s a good idea to get quotes in the event of a major life change such as a move to a new city, a marriage, a child turning 16, etc.
Check first, then by
One of the best ways to save money on automobile insurance is to check a car’s safety rating before you buy. The Insurance Institute for Highway Safety (IIHS) regularly crash tests automobiles and issues safety ratings on them. If you choose a vehicle that’s rated by the IIHS as a Top Safety Pick, you will save money on your auto insurance even if you don’t do anything else.
What else should you know?
You should make sure any company you’re considering is licensed by your state’s insurance department. You should also check its financial rating. It needs to be rated A or better. You should be able to get this information on your state’s department of insurance website. You might also go online and find reviews of the three companies you are considering. If you find one that has many more negative than positive reviews, you might want to cross it off your list.