Do all auto insurance companies offer the same thing?

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Things to Remember...
  • All car insurance providers offer the same basic levels of auto insurance coverage
  • Not every car insurance provider is the same in terms of what they charge for policies
  • Some car insurance companies offer services online while others only operate face-to-face
  • While discounts are usually available from all insurance providers, the type of discount may vary

Car insurance companies may all blend together from a distance, and it’s true that, at some level, they all offer the same thing: car insurance.

But each car insurance company takes a unique approach to the way that they offer this essential service, with different discounts, different ways of pricing their services, and different approaches to customer service and incident response procedures.

All car insurance companies are not created equal; there are some key differences to consider when comparing competing companies and prices.

At the heart of the differences is the price vs. the amount of coverage.

Although there are factors that play a role in auto insurance premiums, they are usually proportional to amounts of coverage. Online rate comparisons help distinguish find the best rates for the best possible coverage.

Enter your ZIP code into our FREE auto insurance comparison tool to determine the best possible rates for you.

A Different Emphasis on Creditworthiness

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Almost every car insurance company in the country requires a social security number when obtaining a quote and signing up for service because auto insurance companies check a credit score when deciding how much a customer will pay for coverage.

Industry research has found that consumers with lower credit scores actually pose a larger risk to insurance companies whether in the form of more accidents or more missed payments.

Not every insurance company treats a credit score the same way, however.

Many of the lower-priced competitors like Safe Auto and others openly tell customers that the credit score is certainly taken into account but has a lesser bearing on customer prices than at traditional companies.

It’s important to consider how an insurance company will treat your credit risk for customers with good and bad credit alike.

Those with bad credit scores should choose a company that will punish them minimally, while those with an excellent FICO score should select a company which rewards them with a hefty discount on premiums.

Online-Only vs Traditional Insurance Companies

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As the internet has become the preferred way of doing business, an entirely new sector of car insurance has sprung up: the online auto insurance company quote.

These companies offer lower prices to customers because they do not incur the significant overhead of maintaining a vast network of agents, bricks-and-mortar branches, and other expenses that traditional insurance companies have.

On the other hand, they are generally harder to reach via phone in the event of a billing problem, coverage issue, or car accident.

When comparing car insurance companies, the price is not the only thing that determines which premium is the most worthwhile.

Car insurance companies which have a large nationwide network of agents will be far easier to deal with in the event that a claim needs to be filed for damages or injuries.

And they’ll be better able to offer personalized service over time. While the price may win online, nothing beats the comfort and security of an in-person agent during times of stress.

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Discount Amounts Can Vary Between Insurance Companies

Almost every insurance company on the market offer some sort of discount for things like being a full-time student, having a safe driving record, having anti-theft devices installed, and more.

But these discounts are often offered for different percentages or dollar amounts, meaning that a driver may save less money depending on their unique qualifications and the execution of an insurance company’s discounts.

For example, a full-time student will want to find the car insurance company with the best discount for students and these discounts vary widely, from as low as 5 percent to as high as 20 percent on some premiums.

This is a great way to compensate for the fact that insurance companies typically penalize younger drivers with higher premiums, as they pose a greater risk to the company.

In that case, the safe driving discount may amount to a lower percentage off for students at some companies. A little savvy comparison shopping will expose these differences and reveal the best insurance bargain.

Nationwide Insurance Companies Offer Opportunities to Bundle and Save

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There are generally two schools of thought when comparison shopping for car insurance rates:

  • Choose a smaller company and perhaps get a lower quote, as these companies are more flexible in their ability to save customers money
  • Choose a large, nationwide insurance company that can offer discounts for bundling services together

In many cases, it actually is cheaper to choose the national insurance company and then combine policies in order to get a lower rate on all of those insurance requirements.

While smaller companies may offer a lower rate exclusively on auto insurance, the smart customer will choose a company that can offer discounts on all of their liability coverage payments.

This is an advantage that smaller companies with limited coverage options simply cannot offer to consumers.

Service Matters When Choosing an Insurance Company

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One thing stays true no matter the price of the car insurance premium: service is tantamount when choosing an insurance company.

A low price is only as good as the agents or customer service representatives who will help during an emergency, and an affordable policy is only as good as the speed with which it gets a driver back on the road.

When comparing car insurance rates, it is important to compare a company’s customer service awards and rankings, which are often listed on the company’s website.

While all of these companies obviously offer car insurance, only a small few offer great customer service. Look at awards, customer reviews, and other indicators of a company’s reputation in order to learn the true value of the insurance policy being offered.

Look at awards, customer reviews, and other indicators of a company’s reputation in order to learn the true value of the insurance policy being offered.

Always Make a Smart Comparison Between Competitors

Comparing car insurance rates is often boiled down to a simple numbers game. But there is much more behind those dollar figures that can only be determined when looking at the finer print.

But there is much more behind those dollar figures that can only be determined when looking at the finer print.

Paying attention to customer service rankings, the true cost of discounts, the availability of agents, and the ability to bundle will not only save money but also future frustration.

The comparisons offered by our FREE auto insurance comparison website are reliable and informative. Enter your ZIP code below to save now!

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