Why You Should Compare Online Auto Insurance Before Choosing Your Policy
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UPDATED: Jul 8, 2021
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Comparing online auto insurance before choosing your policy is a very important part of the shopping process when looking to buy coverage for your vehicle.
When you actually compare online auto insurance, you are more likely to save money on the cost of coverage, get the best policy for your individual needs, get a company that treats customers well, and find a financially solid insurer.
See what different companies are offering you for auto insurance by inputting your ZIP code in the FREE quote tool to begin!
If you do not take the time to shop around and compare auto insurance, you might find yourself with a policy that does not do what you want it to do or a company that does not meet your needs. Even worse, you may find yourself paying more than you need to.
While comparing online auto insurance takes more time than simply renewing your current policy or going with the first quote you get, it really does pay off in the long run.
Because auto insurance is such a personalized product, simply getting a recommendation from one person is not enough information on which to base a decision.
By comparing online auto insurance, you can find out the details of quotes prepared just for you, so that you get the best deal possible for YOU.
When it comes to shopping around for car insurance, you will find that the prices are all somewhat different. In fact, some insurers offer very different prices than the others, while most are in the same ballpark.
This is all determined by the different underwriting guidelines that each insurance company has in place.
Essentially, the same factors are used by all insurance companies to determine prices for car insurance throughout the nation. They include things like driving records, insurance records, age, gender, marital status, type of car you drive, and the amount of coverage you want and need.
However, each company considers these factors a little differently than everyone else and offers discounts that others may or may not offer.
This adds up to different price quotes from different companies for the same person looking for the exact same coverage.
Prices can also be different from one company to another for less reputable reasons. If a company is struggling financially, you will often see their premiums drop dramatically in a last-ditch effort to attract new customers.
Companies that are at that point should be avoided, as they are unlikely to be solvent enough to be counted on to pay out claims, should you need them in the future.
One thing that you must be aware of when comparing online auto insurance is that, when the price is radically different than the other quotes you are receiving it is a red flag to look deeper. It could be something as innocent as a quote being for a six- month policy instead of a one-year policy, or having a lower liability limit.
However, there are many other reasons for a company to undercut the others in the marketplace, and typically these reasons are not good.
While most insurance companies offer essentially the same policies, there can be differences from one company to another.
You can expect to find small differences from company to company, especially if you are getting quotes on full coverage.
Such differences can be extra forms of coverage, like towing and labor or rental car coverage, which some companies add on automatically, while others do not.
Check the levels of coverage when shopping around for car insurance. Some insurers automatically quote state-mandated minimum levels of coverage.
Be sure that the details of the policies that you are comparing are as similar as possible, especially when it comes to the important things like coverage limits and deductibles.
Shopping around is also important because policies differ based on your needs. If you have a vehicle that you store during the winter months, you will need different coverage than someone who has just one car and uses it year round.
If you have a new, expensive sports car, you will have different insurance needs than someone with an old compact sedan. Being aware that not all policies are the same or have the same price is very useful.
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Companies Differ in Customer Service
As in any industry, there is a wide disparity when it comes to customer service. How one company treats its customers can be seen as very shoddy compared to how another company treats its customers.
Finding out how the insurance company you are thinking of using treats its customers can be very valuable information when deciding on your next car insurance provider.
It used to be that you could check out how a company treats its customers by just asking around and getting some word-of-mouth recommendations.
However, now there are so many insurers to choose from that you may not find someone you know who has dealt with the companies you are considering.
Even if you did find someone to ask, just getting one person’s opinion on something so serious is not enough.
Luckily, the Internet has made it easy for consumers to learn about the kinds of treatment actual customers receive from their insurance providers. This form of online word of mouth can be found in a variety of places.
Many states provide information on their government websites about complaints lodged against insurance companies and how they are resolved. There are also a variety of review websites out there that give consumers a forum to review the companies with which they do business.
One of the best sources of information on car insurance companies is from J.D. Power and Associates, which puts together an annual auto insurance study. That study is based on information provided by actual customers and measures claims, billing and payment, price, policy options, and interaction.
It is updated yearly to provide consumers with relevant information that is useful.
Check out how a company fares according to this study when comparing online auto insurance.
Financial Strength of Insurance Companies Differ
When you are comparing online auto insurance, one of the most important things to do is to look at a company’s financial strength. This is so that you can have confidence in the abilities of the insurer to be able to pay any claims that you might have.
In addition, it will give you an idea of the company’s future outlook, so that you can choose a company that should be around for a long time to come.
When you want to learn about the financial strength of an insurance company you are considering doing business with, check out one of the independent insurance ratings organizations that exist just to analyze such information. The renowned and respected ones include Weiss Ratings, A.M. Best, Moody’s, and Standard & Poor’s.
When you check any of these sites, you will find ratings in a graded format. Check how their ratings system works in order to understand the differences between A, B, C, A+, A++, etc.
Typically, if the company you are checking out rates an A or better, you can feel confident that its financial strength is good and you can feel safe doing business with its representatives.
Shopping around Online
Shopping around online for car insurance is an efficient use of your time and energy. Professionals in the industry suggest that you compare as many quotes as possible in order to get the best price and the best coverage.
The most efficient way to do this is online. There, you can get multiple quotes at once, instead of contacting company after company repeating the same information time after time to get the quotes you for which are looking.
Shopping online for auto insurance also exposes you to companies that you may never have considered if you have shopped around using the phone book.
Many of the smaller, lesser known car insurance companies have excellent reputations and rate very well in terms of customer service and financial strength.
Don’t discount a name you don’t know. Do the research on the company and you may be pleasantly surprised.
Go Offline When You Narrow It Down
Once you have narrowed down your choices of online auto insurance, it is important to contact the company directly. Call and speak with an agent. Ask about the discounts they offer and if there are any extras for which you might be eligible.
One of the most significant, but often overlooked, discounts is the payment-in-full discount.
Be sure to ask the agent about anything you are unsure of. Take the time needed to fully understand the policy you are being offered. Car insurance policies typically last from six months to one year and provide the financial protection that you need.
It is important to be clear on all aspects of it. The best way to do so is to go offline and get the answers to your questions.
Take a moment and start to compare online auto insurance now by typing your ZIP code into the FREE quote tool on this page!