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Finding the Best Rates for Auto Insurance

ChristinaJ | Mar 16, 2011 |

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Insurance is one of the most important financial tools you can use to protect yourself. Auto insurance not only protects you from having to repair other vehicles if you cause an accident, but it also protects you financially from uninsured drivers who may hit your vehicle. Although basic automobile insurance coverage is required in most states, you should investigate more than just the minimum coverage. But being fully covered doesn't mean that you shouldn't shop around for the best insurance price. Many resources are available to help you find the best rates for auto insurance based on your needs.

Know the Different Types of Insurance Coverage

Start by finding out the minimum amount of insurance coverage required by your state for each of the categories listed below. Note that there are many additional riders that can be added for an additional fee.

Comprehensive Coverage – Pays for damages to your vehicle due to theft, fire, flood, hail damage or other natural phenomenon.
Collision Coverage - Covers damage to your car if it is hit by another vehicle, or if you hit another vehicle. If you have an older car, do not purchase this coverage if the annual premiums are more than 20 to 30 percent of the value of the car.
Bodily Injury Liability - Covers physical injury to a person if you cause the accident. This also covers any costs incurred if the person sues you.
Property Damage Liability- Covers damage done to another vehicle if you cause the accident.
Uninsured/Underinsured Motorist Bodily Injury- Covers your physical injuries if the person who hits you is uninsured or underinsured. This coverage also insures against hit and run accidents.

Note that state minimum requirements are sometimes not enough coverage. If you have substantial assets, you may need to increase coverage, especially liability.

Raise Your Insurance Deductibles

Get quotes for multiple deductible amounts so that you can see the true difference in price. Increasing your deductible from $100 or $500 to $1000 or higher will greatly reduce the cost of your premium.

Be Careful About Adding Extra Services

Decide if you want any extra services included such as car rental or roadside assistance. These services cost extra so be sure you really need them. Many of these riders are not always cost effective.

Don't Duplicate Coverage

If you have AAA then you don't need roadside assistance on your car insurance too. If you have good health insurance coverage, you probably don't need additional medical coverage for yourself through your car insurance. Go through your other insurance policies in detail and make sure there is no overlap.

Ask for Additional Discounts

Once you find the best rates for auto insurance, investigate the many ways to get discounts on your rates. Here are a few of the most common ones.

Multiple policies (This can include insurance for multiple cars, or adding home or renter's insurance)
Good Student Discount (usually a B average or above)
Safe Driver/No Accident
Anti Theft System
Senior Discount
Short Commute (example: you only drive back and forth to work)

Request Multiple Insurance Quotes

Now that you know what type of coverage you need, you can get online quotes by visiting the following websites.

www.carinsurance.com
www.insure.com
www.insurance.com
www.insweb.com
www.aaa.com (You don't have to be a member to buy insurance)

Alternatively, you can call local agents on the phone and get quotes from them as well. Compare what they tell you with an online quote from the same company to make sure the local agent isn't adding in a commission charge. When requesting quotes, it is important to provide the exact same information to each company. Make sure to specify the identical deductible and coverage information.

If you already have car insurance, investigate online companies to see if they offer the best rates. For auto insurance quotes it really pays to compare pricing. If one of the quotes is less expensive than your current company, print out a copy of the online quote then call your current company to see if they will match the price.

Decide Which Company Offers the Best Rates for Auto Insurance

One you determine the best price and insurance coverage for your situation, call up the company on the phone and have them confirm it. This is especially important for online quotes since the information or rates may be outdated.

A word of caution. Just because a company has the best rates for auto insurance does not mean that you should necessarily use them. Check all companies with Consumer Reports or the Better Business Bureau to see if there have been any serious complaints against them first.