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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