Comparing Auto Insurance

Comparing auto insurance isn't as complex as it used to be. There's no need to call multiple car insurance companies to request quotes, spending hours on the phone. You can get multiple auto insurance quotes in minutes with a simple form.

That doesn't mean you don't still have questions. How can you tell which insurance company is the best for you? Is the cost of auto insurance the only thing that matters? How do insurance companies come up with those rates and why are they so different from company to company?

Comparing auto insurance is a lot easier when you understand some of the basics of the process. You don't need to be an insurance expert to choose insurance like one - you just need clear, concise answers like those found right here.

What affects auto insurance rates?

There are a lot of things that can have an impact on what you wind up paying for car insurance. Some of them depend on the state where you live. For example, some states have laws that prohibit insurance companies from using your credit score for insurance rating, while other states allow it.

You'll need to see which factors affect auto insurance rates in your state, but here are the most common factors insurance companies use to calculate your rates.

  • Where you live. Your ZIP code has an impact on your rates due to things like car theft and claims statistics.
  • Your driving record. Tickets and accidents on your record will likely increase your rates.
  • Your vehicle. Some cars, like sports cars or large SUVs, will have higher rates than others, such as economy cars or family sedans.
  • Your age and gender. Age and gender both have an impact on what you pay for car insurance, due to statistics that indicate some groups are at a higher risk for claims.
  • Your credit score. In most states, car insurance companies can use credit scores as a sign of responsible behavior.
  • The coverage level and deductibles you choose. Basic car insurance is cheaper than a policy with high limits and low deductibles.

Of course, there are other factors that can also affect rates, but these are some of the biggest ones. Not all are within your control, but some of them are. You can keep a clean driving record and work to improve your credit score. You can also take into consideration the auto insurance rates when you're shopping for a new car.

And, of course, you can shop around. Each auto insurance company weighs these factors a little differently. That means that even with a bad driving record or poor credit, comparison shopping can help you find a lower rate.

What are the types of auto insurance?

The type of car insurance you purchase will have an impact on what you pay, but there is some coverage you will have no choice about buying. You have to buy auto insurance that meets both state law and any requirements set out in your car loan. Other than that, you can pick and choose your options.

What are the main types of car insurance? Take a look.

  • Liability. Required by law in most states, liability coverage is broken down into bodily injury and property damage coverage. It's usually written in three numbers: Bodily Injury limit per person/Bodily Injury limit per incident/Property Damage limit. These appear as a number like 25/50/25. Those numbers represent thousands of dollars, so $25,000/$50,000/$25,000.
  • Uninsured/Underinsured Motorist. This covers much the same damages as your liability but pays out when you're involved in an accident with a driver who has either no insurance or not enough insurance.
  • Personal Injury Protection. This coverage is required by law mainly in states with a no-fault insurance system. It covers medical and related bills regardless of fault.
  • Collision. This coverage has a deductible and pays for damage to your vehicle in any situation where there is no other liable driver to pay damages.
  • Comprehensive. This coverage also has a deductible, and it covers any damage other than collision. That can include theft, vandalism, and weather damage.

There are many other options out there that can be added on, including rental car reimbursement and roadside assistance. Options will vary by company. Take your time looking at the options and what they cost before you decide to add them to your policy.

How much auto insurance do you need?

How much car insurance you need depends on a few factors. First, you will need enough coverage to meet your state's minimum by law. Second, if you have a loan on your car you will need to buy the coverage that's required by the terms of that loan.

From there, the answer to the question of how much auto insurance to buy gets a little less clear. For many people, state minimum liability limits are not enough. Why? Because if you're involved in an accident and you're at fault, you will be held personally responsible for damages that exceed what your insurance policy will cover.

Let's say your state requires the amounts in our example above, 25/50/25. You're involved in a serious collision. Several people are injured, and a luxury SUV belonging to the other driver is totaled. You can see how the bills can quickly climb well over your policy limits.

Choosing coverage comes down to the amount of financial risk you can take on, and what assets you have to protect from a lawsuit. Many people don't buy extra coverage because they feel they can't afford it. But the question may come down to whether you can afford not to have it.

At the end of the day, choosing how much car insurance to buy comes down to personal choice and, of course, your budget.

What are the best auto insurance companies?

There are a lot of auto insurance companies out there. It can be confusing, but there are ways to measure how they stack up.

One of those methods is by looking at J.D. Power ratings and complaint ratios. Take a look at how the top 10 car insurance companies rank based on the J.D. Power annual survey and a comparison of each company's complaint volume to the national average.

CompanyOverall Satisfaction of Shopping Experience
(J.D. Power)
Overall Satisfaction of Claims Process
(J.D. Power)
Complaint Ratios vs National Average
(National Average is 1.15)
Allstate3 Power Circles
(about average)
3 Power Circles
(about average)
0.64
(Lower)
American Family4 Power Circles
(better than most)
3 Power Circles
(about average)
0.70
(Lower)
Farmers3 Power Circles
(about average)
4 Power Circles
(better than most)
0.97
(Lower)
GEICO3 Power Circles
(about average)
3 Power Circles
(about average)
0.92
(Lower)
Liberty Mutual3 Power Circles
(about average)
2 Power Circles
(the rest)
6.32
(Higher)
Nationwide2 Power Circles
(the rest)
3 Power Circles
(about average)
0.36
(Lower)
Progressive3 Power Circles
(about average)
3 Power Circles
(about average)
0.89
(Lower)
State Farm3 Power Circles
(about average)
3 Power Circles
(about average)
0.57
(Lower)
Travelers3 Power Circles
(about average)
3 Power Circles
(about average)
1.27
(Higher)
USAA
(Military &
Family Members)
4 Power Circles
(better than most)
5 Power Circles
(among the best)
1.14
(Lower)
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Comparing rates along with company reputation can help you choose a great company at a great price.

Why should you compare auto insurance?

As you can see, there are a lot of factors that go into choosing the right auto insurance policy for you. Finding affordable auto insurance rates is everyone's goal, but you also need to make sure you have the right coverage and a company you can trust.

We're here to help. Everything you need to compare rates, learn about coverage, and choose a solid company is right here. Get cheap auto insurance you can trust without the hassle today.