How to Find The Best Auto Insurance For You

Buying car insurance can be an overwhelming experience. There are many different kinds of auto insurance and what you need for insurance may be entirely different from someone else. With a basic understanding of the different types of auto insurance policies, you can then begin to compare premium rate quotes and find the best insurance company for you. By entering your ZIP into our FREE quote comparison tool you can start saving big today!

Liability Auto Insurance

Liability auto insurance is one of the foundational kinds of car insurance. It is mandatory coverage in 47 states in the United States, although auto rates by state will vary. Liability insurance provides coverage if you cause an accident.

It pays for damages and injuries to the other driver’s car and if they or their passengers are hurt. It does not pay for damage to your car, nor does it pay for medical treatment if you or your passengers are hurt.

If you are looking for cheap auto insurance, liability insurance is often the very least expensive type of insurance to purchase. If at all possible, you should consider buying more than the minimum amount of liability insurance that is required by your state, particularly if you own a home or have other assets. Even if you do not have assets, it is worth it to buy additional liability insurance.

No matter how much insurance you have or do not have, you are still legally responsible for the costs associated with an accident if you cause it. Liability insurance protects you from having to pay those expenses out of your own pocket.

However, if you do not have enough insurance or any insurance to pay those costs, you may be sued. As a result, not only will your assets be at risk, but you may have a judgement issued against you that could impact your credit and any future income you earn or receive.

Collision Car Insurance

Collision auto insurance provides protection for your own car. If you are in an accident and have collision insurance, it will pay for repairs to your car. However, if the damages cost more to repair than the value of the car, it will be declared a total loss and you will be paid the value of the car at the time of the loss.

If you have an older car, this amount may be very low and it may not be worth it to purchase collision insurance. If your car is leased or financed, you will be required to purchase collision insurance by your lender.

Comprehensive Auto Insurance

Comprehensive car insurance is also required by lenders if your car is leased or financed. Comprehensive covers damages to your car related to events other than car accidents. It covers things like hail damage, being hit by a tree limb or hitting an animal. It also covers vandalism and will pay for your car if it is stolen.

Personal Injury Protection Car Insurance

Personal injury protection auto insurance is additional mandatory insurance in 16 states. It is also commonly referred to as “no fault,” PIP and medical expense insurance. Personal injury protection pays for injury treatment regardless of who is at fault in an accident. It pays for lost wages and legal expenses. Additionally, it pays for hospital expenses, doctor visits and rehabilitation.

Uninsured/Underinsured Motorist

Although liability insurance is mandatory in 47 states, many drivers do not carry it and drive illegally. If you are involved in an accident with someone who does not have liability insurance and they cause the accident, uninsured motorist coverage will allow you to get repairs done to your car and receive medical treatment without having to file a lawsuit to recover the costs from the other driver.

Underinsured motorist coverage allows you to receive medical treatment and get your car repaired if the other driver does not have enough insurance to pay for the damages. This type of insurance can be especially valuable if you drive a newer car or an expensive car.

With both uninsured and underinsured motorist coverage, your insurance company will pursue legal avenues to recover their losses. It frees you from the legal hassles of filing a lawsuit yourself, and allows you to get repairs done and seek medical treatment immediately.

Gap Insurance

If you own a newer car that is financed or leased, you might consider purchasing gap insurance for maximum financial protection. If you are involved in an accident and your car is declared a total loss, you will be paid for the value of your car.

However, most cars immediately depreciate in value and the value of the car at the time of the loss – which is what the insurance company will actually pay you – will be much less than your car loan or the amount of your lease when it comes due.

Your lender will expect you to pay the total value of your financial obligation, not the just the amount of money you were paid by the insurance company.

Gap insurance pays the difference between the loss value of your car and your auto loan or lease amount. As a result, you are freed from having to continue to pay for a car you can no longer drive or come up with the money to pay your financial obligation off.

Finding Auto Insurance

With a good understanding of the different types of car insurance, you are better able to shop for insurance and compare rate quotes. There are numerous places to find car insurance quotes and it is a good idea to look at a minimum of three quotes before making a buying decision.

Insurance Comparison Sites – Insurance comparison sites allow you to request multiple quotes by filling out a single online form. You will need to provide a telephone number and email address so that agents and insurance company representatives can contact you for additional information.

Independent Insurance Brokers – Independent insurance brokers represent multiple insurance companies and can provide you with several quotes. They can also help you understand in more detail what type and level of car insurance will provide you with the best protection for your needs.  Try our FREE quote generator on our homepage by simply entering your ZIP!

Final Thoughts

Armed with the right information, it is easy to find the best auto insurance for your specific situation. When buying insurance, ask about discounts and payment options that may lower your rates. Auto insurance may be a little confusing in the beginning, but it should be easy to buy once you understand the basics.