The Simple Guide to Find Great Auto Insurance Rates

Drivers all over the United States are required by law to carry automobile insurance. Finding the best auto insurance for you begins with understanding how rates are set by the auto insurance industry.

Cheap auto insurance is not the best decision when the goal is to mitigate the risk of loss. Policyholders want sufficient peace of mind that claims will be paid in a timely manner. The search for affordable auto insurance begins with selecting an affordable vehicle. Try our FREE quote comparison tool by entering your ZIP code at our homepage!

Before Buying a Car

Wise drivers will pause prior to making an automobile purchase. Romanticism is linked to owning the perfect vehicle, but that approach can cause financial hardship later.

Major classes of automobiles have been established by the auto insurance companies to provide a starting point for the insurance rates.

Passenger car – This broad category will include minivans and most vehicles with four wheels that do not fit into the narrower categories listed below. Actual accident and repair statistics show that these cars are less expensive to repair or replace.

Sports car – Theft statistics determine the cost of insuring the attractive class of vehicles called “sports cars.” Drivers of sports cars tend to take more chances behind the wheel, but replacement of stolen cars is the major cost factor for auto insurance.

Pickup – Drivers of pickups come from all walks of life, and the use of the vehicle is essential for the proper insurance coverage. Detailed questions about the use and location of the pickup will play a significant role in the method used to underwrite an insurance policy for a pickup.

SUV – According to the highway safety standards, Sports Utility Vehicles are safer than other vehicles. Specific information for each make and model reflects which ones are more expensive to insure.

Hybrid – The entire auto insurance industry is holding back on the final assessment of the hybrid cars. Actual accident and repair statistics will determine the cost of insuring a hybrid vehicle in future model years. Only two insurance companies, Farmer’s and Traveler’s, are offering a discount on the premium for a hybrid car.

• Price – Purchase prices for vehicles are increasing steadily with each new model year. Higher prices increase the cost of replacement after loss. Drivers must consider the outstanding loan balances and the amount received from the insurance company in the overall decision.
• Safety features – All manufacturer-installed devices that reduce the risk of injury or damage improve the insurance rates.
• Anti-theft devices – Insurance companies can refuse to insure vehicles in certain locations because of the lack of anti-theft devices. Satellite-monitoring services are reducing the incidents of theft, which is lowering insurance rates.
• Insurance Institute for Highway Safety – Actual statistics gathered by the insurance industry are published for each make and model. Potential owners can view the ratings for injury, theft and accidents.

Select an Insurance Company

Trust in the insurance providers is built on the strict adherence to certain government regulations. Companies must prove the ability to pay claims following significant loss occurs. Drivers can find actual insurance company ratings from a third-party entity.

• A.M. Best Company rating – Every insurance company is assigned a grade for various aspects of conducting business. The major ratings for great companies are “Best,” “Most Substantial,” “Most Favorable.” Those with lower ratings will be described in less favorable terms. Any company that does not have a rating is either new or underperforming its peers.
• Customer service – Claims must be handled with care and dispatch. Drivers can read about the experiences with insurance companies. Customer service is extremely important to some policyholders, and the company should be chosen accordingly.
• Complaint ratio – The National Association of Insurance Commissioners tracks the complaints filed by policyholders with the state insurance commissioners across the nation.

Auto Insurance Coverage

Saving a few hundred dollars each year on auto insurance can cause a severe financial hardship for anyone who is not able to replace the vehicle. Personal insurance needs must be defined before determining which of the following major components should be included in the final policy.

• Collision – A car that collides with a stationary object or another vehicle will be repaired or replaced under this component. The policy limits must be sufficient to cover the expense.
• Comprehensive – Events that are not related to a collision are paid from this component. Theft, fire or falling debris is covered under this component. Drivers who rent cars rely on this component for additional insurance on the rental car.
• Liability – Every state requires drivers to carry liability coverage above a certain dollar amount. Insurance companies are encouraging every driver to carry more than the minimum.
• Property damage – Property belonging to another person is covered by the liability insurance. The policyholder’s property is not covered under the liability component.
• Bodily injury – Passengers in the vehicles involved in the accident are covered under this subcomponent. Medical expenses add up quickly, so every driver is encouraged to carry sufficient liability coverage.
• Medical – Any driver without major medical coverage from another source is encouraged to carry this component. The policyholder’s medical bills will be paid from this component up to the policy limit.
• Uninsured/Underinsured motorist – In certain areas of the country, a higher percentage of drivers do not have insurance. This subcomponent is recommended to cover the risk that is presented by those who do not have sufficient coverage.

No-Fault Insurance Laws

Some states have implemented a no-fault system for auto insurance. This method is directly related to the litigation reward limits that are paid to those injured in an automobile accident.

Restraining legal costs lowers the amount of money that the insurance companies pay out, which reduces the cost for all policyholders.

Ways to Reduce Auto Insurance Rates

After assessing the right coverage, the insurance shopper can find the best insurance company by seeking every possible discount on the policy. Every insurance company is different, so the savvy shopper asks a lot of questions during the pursuit of affordable auto insurance rates. Take advantage of our FREE quote generator by simply entering your ZIP at our homepage!

• Multi-car discounts
• Multiple policies
• Limited drivers
• Liability-only
• Low-mileage
• Increase deductible
• Clean driving record
• Good credit

Final Thoughts

Automobile insurance is a necessary expense for anyone who wishes to comply with the law. Lower car insurance rates are awarded to responsible drivers with risk-lowering habits in other areas of life. Insurance companies offer great rates to those who reduce the risk that a claim will be made against the policy. Smart drivers will comply with every traffic law and enjoy lower rates as a reward.

Be sure to enter your ZIP code into the FREE comparison tool below!