Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products, including home, life, auto, and commercial, and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, mainly in the insuranc...

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UPDATED: Oct 19, 2021

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Almost everyone who buys insurance wants to buy a policy that offers expansive coverage options, which also fits into a specific budget range.

Buying insurance goes into the list of the many costs you take on when you own a vehicle. Still, unlike other expenses that come around every other year, car insurance is an expense you will pay each month, quarter, or year, just like clockwork.

When you buy a product that you are required to have and do not want to put to use, you must find the best rates and the best carriers. The only way that you can do this is to comparison shop before you buy.

Comparison shopping gives consumers the power to find what they are shopping for at a value price.

If you want to reclaim the power in the market as you shop for a new auto insurance plan to replace your renewal policy that has doubled in price, you need to know the smart way to compare coverage, carrier, and lastly, cost.

Many believe that comparisons have to be part of a time-consuming mission, but that is not the case if you know exactly what to do and what tools to use.

Read on, and learn how to compare car insurance coverage in the most effective way possible so that you become the one with the advantage. Then, use our FREE tool at the top of this page!

Why is comparing auto insurance coverage and rates important?

Suppose you do not want to pay excessive money for insurance coverage each year. In that case, you need to determine how much each company charges. What you might not know is that every company sets its own rates.

These rates need to be approved by the state department. Still, as long as they can be justified, the company can decide how much to charge drivers in your rating classification.

Because rating systems vary from carrier to carrier, you as a consumer need to find a company with a rating system that benefits you.

Some companies prefer to do business with experienced drivers who have accident-free records. Then some companies like to price themselves in the high-risk market full of young drivers and drivers with serious violations.

If you end up choosing an insurer that has priced their products for accident-free drivers and you have accidents, you will pay higher rates than you would if you had chosen to shop around and compare rates.

By taking the time to compare the premiums with each of the well-known carriers that do business in your state, you can narrow down the options and sift out the providers that just are not right for you.

Besides, comparison shopping is the best way to save money off of your auto insurance premiums without choosing to eliminate coverage or buy low limits.

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What types of coverage do you need?

The cost of auto insurance depends partly on the coverage level you sign up for. Most states have minimum requirements for car insurance that you must fulfill to drive legally. Usually, the requirements consist of liability insurance (bodily injury liability coverage and property damage liability coverage). Still, some states also require additional coverages like personal injury protection or uninsured/underinsured motorist coverage.

If you sign up for liability coverage only, your insurance premium will be less expensive, but you won’t have a lot of protection. For example, suppose you want your own damages covered after an accident or other incident involving your car. In that case, you will need to add collision coverage and comprehensive coverage to your auto insurance policy.

You’ll want to consider additional coverage options, such as roadside assistance, medical payments coverage, and accident forgiveness.

What other factors determine the cost of car insurance?

Auto insurance companies will look at various personal factors when assigning your insurance rate, including your age, gender, location, marital status, driving history, and credit score.

Those with a clean driving record will always get the lowest rates, as the insurance provider assumes you will be less likely to file a claim. However, high-risk drivers will have trouble finding affordable prices.

If you look at rates by age, you’ll see that teen drivers pay the highest premiums, and the price goes down as a person ages.

How do you compare auto insurance quotes to find the best rates?

While there are exceptions to the rule, most comparison shopping consumers are doing their homework to save money. Because the price is so important, you must take the proper steps when you are comparing quotes.

If you fail to take these steps into consideration, you may compare two entirely different policies that really are not comparable.

Here are the steps that you must take when you prepare to shop around:

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Get your Declarations Page Ready for Review

If you already have existing insurance, you will need your declarations page before pulling up quotes. The declarations page is the single document you received from your current insurance company about your auto policy that lays out who is covered, what is covered, and how much coverage you have selected.

It includes the pertinent information that you will need to effectively compare costs. Without this page, you really can only guess how much insurance you are paying for.

You receive your declarations page when your policy is issued, and every time it renews.

If you cannot locate it, you can ask your insurer to send you a new one for your review.

Some insurers also have online tools to locate policy documents and print these documents off of the Internet. Once you get your hands on the document, review it for accuracy, and then move on to compare costs.

Sift Through the Companies to Find the Best Options

Not all auto insurance carriers have the same reputations or the same product offerings. Of course, we’re all looking for the cheapest car insurance companies, but you don’t want to throw quality out the window.

Before you even look at the price, you should cross the companies that do not deserve your business off the list of possibilities. There are a few ways that you can decide if a company is ultimately worth trusting. Here are the factors to consider when deciding what carrier to get quotes from:

Licensing Status: Departments of Insurance are state bodies that set the standards of conduct in the industry. They oversee carriers and also investigate complaints. If you want protection as a consumer, only buy from a licensed insurer.

Check the insurer’s licensing status through the state Department of Insurance before doing anything else.

Financial Solidity: Insurance companies are offering you financial protection. If the company is not financially secure, it is hard to be confident that you will get your claims payments if you ever file a claim.

This is why financially sound companies are the best companies to give your business. They have generally been in the industry for years and are established as carriers.

Check out ratings with agencies like A.M Best to determine the grade of a specific insurer.

Official and Unofficial Complaints: Consumers are free to file complaints against a company with the Department of Insurance when they do not satisfy the standards of conduct.

The department then looks into the accusations and will decide the next course of action. You can also file unofficial complaints through social media or other platforms to air out your frustrations.

Be sure to check each platform to see if there are loads of complaints. If the company does not respond to these complaints, you know that they are not dedicated to keeping policyholders happy.

The Better Business Bureau and J.D. Power are other good sources to check when you want to learn about a company’s customer satisfaction ratings.

Get Apples to Apples Quotes

You never want your quotes to have different limits or coverage options. The best way to compare the price of a policy from one company to the next is to have each field match.

If you are currently carrying state minimum coverage with your insurer, you should price the same cost with the others.

If you have low deductibles, keep the deductibles low as you get your initial quotes.

If you make adjustments, you are comparing apples to oranges. As a result, you may wind up switching insurers when your current company could have had better rates in the end.

Make Adjustments and Compare

While apples-to-apples comparisons are essential, making adjustments when you are not happy with your limits or coverage selection is also vital. For example, if you notice that you have low limits, high deductibles, or you have not opted to carry supplements that you need, now is the time to price the difference.

You should start by asking your current insurer for a rate quote to make the changes that you want to make. Once you get this quote, start comparing the price with the same adjustments through the previously contacted carriers.

By doing this, you can see if the company offers cheaper rates when you decide to buy more coverage. Believe it or not, some carriers might be more competitive with larger limits than they are when you purchase the minimums.

You should also check over any insurance discounts offered by the companies you’re considering. For example, most major insurers offer a wide range of deals like the safe driver discount, multi-policy discount, multi-vehicle discount, and defensive driving course discount.

How can an online quote tool save you time and money?

It can take a great deal of time to get all of the rate quotes that you want to compare when you shop around. Fortunately, you do not have to leave home and visit several offices to see agents and get pricing.

You do not even have to pick up the phone and speak to dozens of agents that you will never talk to again.

This is because special comparison tools you can use online will give you access to quotes from insurers that have already made your list.

The best thing about using a rate comparison tool to find the lowest rates is that you do not have to waste all of your free time pricing a product you must buy.

Your time is valuable, and you should always use tools that make your mission to save money easier. Once you locate the tool, all you need to do is enter your information and coverage. Then, look over the companies with the cheapest rates for the coverage you need.