A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

Full Bio →

Written by

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...

Full Bio →

Reviewed by Leslie Kasperowicz
Farmers Insurance CSR 4 Years

UPDATED: Oct 18, 2021

Advertiser Disclosure

It’s all about you. We want to help you make the right coverage choices.

Advertiser Disclosure: We strive to help you make confident car insurance decisions. Comparison shopping should be easy. We are not affiliated with any one car insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about car insurance. Our goal is to be an objective, third-party resource for everything car insurance-related. We update our site regularly, and all content is reviewed by car insurance experts.

Car insurance was developed as a way of making sure that individuals were responsible for damage to property and person of other parties when involved in an accident. Once cars were used widely, this became a definite need. Start comparing car insurance rates now by using our FREE tool below!

The United States is a particularly large country and the automobile became the preferred mode of transportation. States began to require liability insurance on a compulsory basis to protect third parties against the financial consequences of being damaged or hurt by a vehicle. At present, Virginia, New Hampshire, and Massachusetts are the only states where vehicle insurance is not compulsory. Residents of Virginia must provide the state either a $500 annual fee or proof of liability insurance to register their vehicles. New Hampshire and Massachusetts offer the option of a cash bond in lieu of insurance.

Compulsory Auto Insurance

It is assumed by most states that some of the time, individuals at fault in a car accident won’t be able to pay damages to the other person’s car and person. As compulsory car insurance has become more common, the average number of uninsured motorists has dropped from 15.6 per cent in 1992 to 12.6 percent in 2012. On the other hand, in some states it has risen to 25.9 per cent in Oklahoma and as low as 7.0 per cent in South Dakota.

Enter your ZIP code below to compare car insurance company rates.

 Secured with SHA-256 Encryption

Registering an Auto

States require you to provide proof of insurance with your initial registration of the automobile. Some will only accept proof of insurance in the form of a document from the insurance company; others will accept your assurance if you sign, saying that you have insurance. Individual states differ, but, the states that require documentation average considerably fewer uninsured drivers in accidents than those who accept signatures.

Basic Automobile Insurance

Each state has a certain amount of bodily injury liability and property damage liability required as minimums by the state. To find out these, go to the insurance department for your state to discover what is required. For a brief rundown of laws, you can contact the National Motorists Association.

Be careful to examine the minimum limits as real money because sometimes they are surprisingly low and may not protect you adequately.

The state’s insurance department often has other consumer information available such as comparable rates across the state, licensing information for insurance companies and agents, as well as a bunch of tips on purchasing car insurance.

Usual Coverage on an Auto Policy

An automobile policy covers these particular things ordinarily. Some, such as comprehensive and collision protect your own car. Medical payments reimburses drivers and their passengers for medical costs. Uninsured/underinsured motorists help with bodily injury and death to you and your passengers if you are in an accident with someone without insurance and it is their fault.

Some states require PIP or personal injury protection, which is called “no-fault” coverage to pay for injury to you and your passengers without concern for who is at fault. No fault is intended to level out the insurance field for drivers’ and their insurance. Great idea, but implementing it has been a problem for many states.

  • Bodily Injury Liability is usually expressed as a split limit. An example would be $20,000 per person and $50,000 per accident -and, as you can see, at present prices this does not cover many medical bills. It is your liability to others for injury you cause while driving.
  • Property Damage is expressed as one limit. An example is $25,000 property damage liability –your responsibility for others property while driving. This includes other cars, fences, light poles, houses, or anything you damage.
  • Medical payments coverage is expressed as one limit, for example, $10,000. It is not intended to replace medical insurance, but to help with deductibles and emergency care for you and your passengers.
  • Uninsured and underinsured motorists coverage matches the amount of bodily injury liability on your policy. This helps pay for you or your family’s injury or death if involved with someone without insurance in an accident.
  • Comprehensive coverage pays for damage to your own vehicle for things such as hail, flood, windstorm, animal damage, vandalism, theft, and fire. This coverage usually carries a deductible set by you.
  • Collision coverage pays for damage to your car if someone or something runs into it.
  • Other coverages available such as towing and labor, rental reimbursement, and roadside assistance are available.

Enter your ZIP code below to compare car insurance company rates.

 Secured with SHA-256 Encryption

Saving Money on Car Insurance

It is possible to save money on car insurance by comparison shopping. Select at least three companies known in your area to provide insurance and ask them for estimates or quotes for insurance. Going to an independent agency representing many companies is useful because it cuts down on time.

Things to consider:

  • Multi-car discounts and multi-policy discounts. For example, if you insure your home and all your cars at the same place, you can save money.
  • Discounts for marriage – if you are under 25 and get married, it can save you money on car insurance. Statistics prove that married people have fewer accidents.
  • Good student discounts for those still in high school or college. A transcript of your grades can save money.
  • Credit for safe driving courses is especially available for older drivers.
  • Driver’s education courses for young drivers can reduce your premium.

In conclusion, make sure the insurance company and agency are licensed in your state. Larger cities tend to have some doubtful people selling insurance. Unfortunately, when you need insurance, it is needed immediately. Make sure the insurance company will be in business next year because fluctuating economies and weather patterns are affecting insurance companies. Three sources for financial information about insurance companies:

  • State insurance department
  • National Association of Insurance Commissioners
  • A.M. Best Company for financial ratings

Do not let your insurance lapse because it can affect your premiums. Keep abreast of your assets and financial situation, too. You can have your monetary life affected by not having insurance because the bills stay with you. If you are in the market for a policy start comparing car insurance rates now by using our FREE tool below!