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Car insurance is a necessity if you own a vehicle, but it doesn't always come cheap. To get the best price possible, drivers should compare car insurance rates from several providers. Below, we'll look at why this is necessary and what factors can affect auto insurance rates.
The following factors affect driver's premiums when they compare auto insurance rates:
We'll look at how each of these factors affect the rates of drivers in the next section.
If you're trying to find the best car insurance rates, you need to know how the above factors can raise or lower premiums. Here are some examples of how certain parts of the application could help or prevent drivers from scoring the lowest car insurance rates.
Looking at the average car insurance rates by age and gender, teen males pay much more than most other drivers, and teen females aren't far behind. That's because teen drivers have less experience on the roads and are statistically more likely to engage in risky behavior, like distracted driving. This leads to more claims, so an insurance company often charges younger drivers more. See our choices for the best car insurance for teens and young drivers.
Accidents, particularly at-fault accidents, can raise even the best auto insurance rates considerably. These accidents remain on a driver's record for three to five years, depending on the state they live in. Their effect decreases over time, but the driver's auto insurance rate probably won't drop to pre-accident levels until the accident falls off their record. See our choices for the best high risk car insurance.
While credit may seem unrelated to one's driving ability, an insurer will use credit scores as a measure of personal responsibility. There is some statistical data to support the fact that drivers with higher credit scores are less likely to cause accidents. That means drivers with high credit scores get the best car insurance rates.
There's a huge variance in insurance rates by car. More expensive cars are obviously more expensive to insure, but so are cars that are common targets of theft and vehicles with larger engines that can go faster. Drivers in the market for new vehicles but who are trying to keep their costs down could consider looking for cars with the lowest insurance rates to save a little money.
When drivers compare car insurance rates by state, costs can vary significantly. The average car insurance cost in each state depends on several factors, including state auto insurance laws, the likelihood of natural disasters or animal-vehicle accidents, the number of uninsured drivers, and more. Even if you compare car insurance rates from adjoining zip codes, you’ll find wildly different rates based on how many accident, vandalism, and theft claims drivers report in the area.
If you're in the market for inexpensive auto insurance, follow these steps to get it.
Not all insurance companies operate in all states. To compare car insurance rantes, drivers should begin by making a list of each insurance provider available in their state, which may include most national insurers, like:
Although all states have certain minimum auto insurance coverage required by law, many drivers choose to purchase more than this. Most insurers offer a variety of additional protection options to choose from, though not all options are available with all insurers. Think about the type of car insurance coverage options that matter most and narrow down the list of possibilities. Drivers should only compare auto insurance rates from companies that offer what they're looking for.
Choose a handful of insurers to compare car insurance rates from. Set aside some time to get quotes either on their websites or by contacting the insurance provider by phone. Most companies will let people save a car insurance quote for later if they want to return to it.
Look over the auto insurance quotes to decide which is the best. Price is obviously going to be an important factor, but it shouldn't be the only one. Look into customer service, deductible options, and the financial strength of the car insurance company. This can be determined by using independent rating agencies like A.M. Best and S&P Global Ratings. Compare car insurance quotes based on all these factors and choose the one that performs the best in all categories.
Score discount car insurance rates by taking the following steps:
As discussed above, comparing the best car insurance rates can help drivers see which companies offer the best insurance coverage options for the most affordable price in their area. All insurers weigh a driver's application a little differently, so it's important to get a quote from a few to see which offers them the best price.
An auto insurer will offer discounts on car insurance to help qualifying drivers lower their rates. The exact discount list varies by insurance company, but some common ones include the following:
An increasing number of insurers also offer car insurance discounts to drivers willing to prove their safe habits by installing a monitoring device in their cars.
Deductibles are out-of-pocket costs in the event of an accident, while premiums are the monthly costs drivers pay to keep their insurance. Choosing a higher car insurance deductible can lower the monthly insurance premium. Drivers who keep the money for their deductibles in an emergency fund can save quite a bit on their car insurance premium while still remaining financially secure in the event of an accident.
Safe drivers pay less for auto insurance. Try to avoid tickets and accidents at all costs. Drivers should also think seriously about whether to file a claim for a minor accident that could be covered out of pocket. Doing so may raise insurance rates, and the car insurance company may not even cover the damages if the amount is less than the deductible.
Shopping around is the best way to ensure you're getting a great deal on car insurance. Compare car insurance rates from several companies to see which can offer the best price.
Drivers cannot negotiate car insurance rates with an insurer. The next-best thing is to compare rates from several companies to see which offers the best price.
There is no magic number for how much car insurance rates should increase in a year. It depends on whether you've had any accidents, where you live, and the vehicle you drive, among other factors.
There could be several reasons for this. Sometimes, car insurance is high because a driver lives in an area prone to natural disasters, accidents, or car thefts. Other times, state laws make it expensive for insurers to operate in that area.
It's a good idea to compare auto insurance rates at least once per year to see if there are better options out there.
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