Auto Insurance Tips
Find the right auto insurance
Most states require car owners to buy liability insurance, and some require uninsured motorist coverage and/or personal injury protection. But having only the state-required insurance isn't enough for a lot of people. Many drivers want better insurance in case they're sued after an accident, and many want insurance for damage to their own cars. Click through the slideshow below to find basic coverage types you might want in addition to liability insurance.
What's a recommended amount of car insurance?
If you buy a low level of liability and cause an accident, you can be sued for damage and injuries that your insurance doesn't cover. And if you have assets to protect in a lawsuit -- such as a house and savings -- buying a good amount of liability insurance is a smart financial move. Below are examples of coverage levels.
Find car insurance requirements in your state
Saving money on auto insurance
Knowing how auto insurance is priced will help you save money. You may not realize all the factors that car insurance companies consider. Let's look at how car insurance rates are set and find ways you can save.
Keep a clean driving record
Causing a car accident is one of the biggest reasons for high rates. Auto insurance companies typically add a surcharge at renewal time after you cause an accident. A surcharge is an increase for a specific period of time. If you have a surcharge, ask your agent when it ends.
Maintain good credit
Many insurance companies take your credit (sometimes referred to as a credit-based insurance score) into account when they calculate your auto insurance premium. Insurance companies have found that having poor credit correlates to making more claims. (Not all states allow the practice.)
Increase your deductible to save money
If you have comprehensive and collision insurance, you can reduce your premium by increasing the deductible. A deductible is the amount taken out of an insurance check if you make a collision or comprehensive claim. Typical deductibles start at $250 or $500, but increasing your deductible to $1,000 or $2,000 will save you money. Just be sure that you can afford the higher deductible in case you make a claim. (There is no deductible on liability insurance.)
Switch billing plans
Insurance companies often provide billing options such as monthly, quarterly, semi-annual or annual. Here are ways to save:
- Pay in full rather than in installments. Many insurers give a discount for this.
- Ask your insurer if there's a discount for using automatic withdrawals (ETF payments) to pay your car insurance bills.
- Some insurers also offer discounts for going paperless. You'll receive bills and policies electronically.
Since car insurance quotes are free and easy to get, comparison shopping is a good use of time. We've seen rates vary by hundreds of dollars among insurers for the same coverage. Get quotes from at least a few companies so you get an idea of what a "good deal" is.
EverQuote can connect you to agents who will give you quotes and answer any questions you have about buying coverage.
Don't let a policy lapse
If you let your auto insurance policy lapse -- meaning expire without canceling it -- expect higher rates when you go to buy another policy. If you don't maintain continuous coverage, you're seen as a risky customer.
Remove unnecessary coverage on older cars
Collision and comprehensive insurance can become less valuable as a car gets older. Think of it this way: If your car is stolen or totaled, the maximum payout is the value of the car. An older car may have little value, so paying for collision and comprehensive coverage over many years may not make financial sense. Websites like NADAguides.com can help you determine the current value of a car.
Find a good company
Getting a great price is important but so is finding an auto insurance company with good customer service. Check out our reviews of major insurance companies to see how they stack up.
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