Shopping for car insurance – it’s one of those personal finance tasks that can save you a ton of money, but seems to be a big pain. Maybe you go to one or two websites and shop for good prices, or perhaps you rely on a broker. Well today I’m going to give you my ultimate guide to shopping for car insurance here in the USA.
I’ve seen many of my friends not even sure who all the car insurance companies out there are – much less how to shop around for insurance. It seems painful. Some of the companies will even repeatedly call you and try to sell you a policy. Good news – I have a way around that too. And this will take less time than you think. The “hourly rate” of shopping for your car insurance can be enormous – you can save tons of money here. Often hundreds, but sometimes thousands, of dollars.
Don’t think that you’re getting a good deal because you’ve been with your company for a long time. Often you’re getting a much worse deal.
Shopping For Car Insurance – Preparation
First, make sure you’ve set aside a few hours on a weekend to do your shopping. Two hours should do it.
Call your current insurance company and ask if they have any discounts you might be eligible for that they’re not currently giving you. Also check on your insurance limits and make sure they’re set at what you’re going to use when shopping for insurance. This way, your comparison price is the lowest you can get.
Need some more basic information on how car insurance works? Check out this article.
Create an Excel document to track the companies and prices you’ll get in your shopping marathon. I recommend a few columns in your sheet:
- Company name – name of the company you got the quote from
- Price – The cost they quote you
- Term – Whether the cost is for six or twelve months. You need this to compare apples to apples, since some companies will quote you for six months, and others for twelve
- 12 month price – If a company quotes you for six months, multiply that number by two in this column. If the quote is for twelve months
- Quote number – For you to put the quote number they give you
- Notes – This is where you can note anything that might be unique about the policy or coverage
Put your current car insurance company, price, term, and 12 month price at the top of your Excel sheet.
Car Insurance Shopping – Information To Have On Hand
Now you’ll want to gather the information you’ll need to shop for, and buy, your insurance. Here’s what you’ll need:
- Car vehicle identification numbers (VINs)
- Social security number of primary insured
- Note – If your credit is frozen, you may want to thaw it for this process. Many, although not all, companies pull a version of your credit called an “insurance score” to price your policy. It’s related to your credit score, but not exactly the same thing.
- Vehicle mileage of all cars
- Drivers license numbers and expiration date
- If your license is expired, please renew it before shopping around. Companies won’t insure you with an expired license
- Current car insurance policy and limits, so you’re comparing apples to apples in terms of coverage. You’ll want to know what you have for liability, property damage, medical payments, uninsured and/or underinsured motorists, personal injury protection (in some states), comprehensive, collision, towing and labor, and rental reimbursement coverage
- Information on any discounts you might be eligible for. Defensive driving and good student are usually the big ones. You’ll also want to research whether your employer, or any clubs/associations you’re a member of, offer any discount options
List Of Car Insurance Companies And Their Websites
You might want to bookmark this page and come back later when you’re going to do your shopping. Why? Because I’m going to give you a list of companies and their links so you can quickly do your shopping. Most of these companies are available nationwide, although a few are not. Here you go:
- State Farm
- Liberty Mutual
- USAA (if military)
- Safe Auto
- AAA (if member)
- Met Life
- The Hartford AARP (for 50+)
You can copy this list into your Excel sheet, and add any other companies you would like. Have a specific recommendation of a company to add? Let me know in the comments and I’ll add it to the list.
Why are you going to want to check all these companies? Because there’s no such thing as the least expensive company. They all have different ways of rating policies, so depending on your age, vehicle(s), family situation, education, and other factors the company that’s the best deal for you is not going to be the best deal for your neighbor. And the way companies rate changes annually. So shop around, every year.
What about using a car insurance shopping aggregator, so you don’t need to go to so many sites? You sure can do that, but some of the companies above don’t participate in the aggregation shopping sites. I would suggest visiting these sites and adding the companies you get quotes from to your list:
Watch out for companies that say they’ll “shop other companies” for you. They only display back to you the rates for other companies they want you to see. So if they really want you as a customer, they’ll show you more expensive quotes. They don’t want you? They’ll show you cheaper quotes. Be in control of your own shopping destiny.
Other Car Insurance Shopping Tips
Use a throwaway email address, not your main one. After a shopping marathon you’re going to get bombarded with junk emails, sometimes for years. I have an email address I use just for coupons, giveaways, and yes – insurance quotes. If you don’t have one, just create one through gmail. Don’t worry, if you buy a policy with one of these companies you can change it to your real email.
Also don’t use your real phone number until you buy a policy. I leave the phone number blank, and if the company forces me to fill it in, they get a fake one. I made the mistake once years ago of giving Allstate my actual number and I must have received five calls from three different agents within a few days. It was horribly annoying. So remember, fake phone number.
If you’ve been in an accident, or had a ticket, find out all the details before you start to shop. The companies are going to want to know details – the date, the amount and type of damage, fault, etc. And don’t think you can just leave it off, if you buy a policy they’re going to run what’s called a CLUE and MVR report and will get all your reported accident and ticket information. Don’t know the details? Call your insurance company and ask. Your current insurance company can also run an MVR for you, but then they’ll include the ticket(s) in your rate when your policy renews. Many companies run these every year anyways, though, so it may not hurt.
Note how I said that all reported accident and ticket information will be grabbed by these reports. That’s a key word. If you got a warning? It’s not showing on your MVR. Did you hit your mailbox leaving the driveway, and fix the car yourself? That’s not on your CLUE. You rear ended someone but there was no damage, and they said “have a nice day” and left? Not on your reports. So you’ll want to accurately report all incidents on your reports, but there’s no need to over-report yourself.
Actual Car Insurance Shopping Time
Now it’s time to get busy. Click on those links and get to work. Many of the sites have an automated report they’ll run to find all the cars in your household, but some do not. But getting a quote can be very quick, especially when you know what you’re looking for.
Once you get the quoted price back, be sure to check three things:
-What are the coverage levels they’re quoting? Often the companies have some kind of default coverage amount they use. At times it’s state minimum (NOT what any money-smart person should be carrying). It may not have comprehensive or collision, depending on the age of your vehicle. Be sure to check and adjust the limits so you’re comparing apples to apples.
-What’s the term limit they’re quoting? A six month policy will obviously look a lot less expensive than a one year, because it’s for half as long. Don’t fall for that.
-Do they offer any paid in full discounts, or unique benefits? You’ll want to note that in your Excel
After each quote, pop the information into your Excel. At the end of just a few hours, you’ll have organized quote information from every company on your list (assuming they quoted you) and will likely have an option that’s much less expensive than your current company. This is particularly true if you haven’t shopped around in a while.
But Wait! Don’t Buy The Car Insurance Yet
This process has gotten you a series of apples-to-apples quotes from various companies. But you don’t necessarily want to go with the cheapest one. Look at the three least expensive companies on your list and research their rates. How easy is it to deal with them when it comes to claims? Are there a lot of complaints? Are they highly rated?
Now you’ll also want to check to see if they offer a homeowners insurance discount. Many companies will also offer a renters/condo policy discount as well, if you have all your insurance with the same company. If they offer this, you’ll want to get a home quote as well to see what your total package offering is.
I Want to Hear From You!
If this guide was helpful, and a homeowners insurance shopping guide would be useful, let me know in the comments. And tell me – what questions do you have about shopping car insurance that I didn’t answer?
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10 thoughts on “Ultimate Guide To Shopping Your Car Insurance”
Super helpful guide, Liz! And I’ll be honest – I hate insurance and insurance shopping. Our insurer bundles everything together (we have 10 policies due to rental houses) and we do get a discount in areas. But we keep our deductibles really high too – because we basically self-insure. I was dropped from insurance for a bunch of car-deer hits years ago and since then – we’ve learned that it is sometimes easier to just pay for repairs (we’ve never had a car totaled though.) And wait until your kids need insurance… Make sure you shop that! We had quotes from $400 to $1800/year for our son! Great post!
For some reason, New Hampshire is a state where only a few home insurance companies operate, and since I usually try to bundle my policies, I’ve tended to be limited about choices. I love the tip of using a throwaway number and email. Yes, I’ve made the mistake of giving my real details and it was spammy emails/phone calls for weeks! It’s amazing how much the quotes can vary, like Vicki said above.
Sometimes it can actually be less expensive to split home and auto. It’s always worth checking whether you can get a better price that way or not. I’ve found sometimes I can, and sometimes it’s better to bundle. And I feel you on the emails and calls!
Good point! I’ve done both in the past, depending on how the $$ stacked up. It seems like inevitably, our home insurance will go way up after a couple of years and I have to go through the entire process again!
Great post Liz. I’ve been procrastinating changing my car insurance since I loathe talking to salespeople on the phone. It’s about as unpleasant as going to the DMV. But I know I’m paying too much right now, so need to get over it and just suck it up.
I also hate talking to salespeople-that’s why I do all the prework online
Hi – I am an old mom and have insured lots of cars and lots of new drivers (I have a large family). I recommend you start backwards – check the ratings first. http://www.jdpower.com/ratings/industry/insurance JD Powers is a good place to start. You want a company with excellent customer service ratings above all else, because when you or your child is in an accident (and it may be someone else hitting you not the other way around) you want them to have your back. Honestly, you get what you pay for often in this industry so don’t under insure or go cheap – just expect your kids to have a fender bender that requires a claim; and be happy if they don’t and even happier when no one is injured. I am a practicle mom. Make sure you can read and understand the policy in detail – auto and home/renters. Some companies do write excellent policies the customer can understand. Just scratch the poor companies off your list and don’t even approach them for quotes – why even be tempted by a low ball rate. Make sure the liability part of the policy is adequate. Many will cut that to 10,000 or so to keep the policy low and if you are in an at fault accident- or your child is – oh baby, the vultures come out ant it is your insurance companY that handles the lawsuites. 10,000 won’t cut it. I have raised 6 new drivers, added them to policies, almost all had minor accidents, some had lawsuits attached that my company settled and my company has never dropped us or even raised my rates. They answer the phone – real people – after one menue and call me back. They were’t the cheapest out of the gate but they were the best rated. They also weren’t the most expensive. In my long term wealth strategy this preserved my wealth. Just my two cents.
‘I have an email address I use just for coupons, giveaways, and yes – insurance quotes” I do that too. I subscribe to all sales and stuff, and used to check that email once in a while. Now that I am trying to not buy anything, I haven’t checked that email in a few months now 🙂
Great guide Liz. Since we don’t drive that much, we go through a pay-per mile car insurance company called Metromile. They give a base rate of $40 and charge us around a nickel per mile. It’s been a pretty low so far charging us around $80-$90 a month depending on how many miles we drive. Definitely cheaper than the ones that give us a flat rate for six months.
Eventually when we buy a home we will shop around for a package deal at other insurance companies since Metromile only offers car insurance.
That’s a great deal, especially if you don’t drive much!