Mathew B. Sims is Editor-in-Chief and has authored, edited, and contributed to several books. He has been working in the insurance industry ensuring content is accurate for consumers who are searching for the best policies and rates. He has also been featured on sites like UpJourney.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com and Safeco. He reviews content, ensuring that exis...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Apr 24, 2020

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It’s all about you. We want to help you make the right coverage choices.

Advertiser Disclosure: We strive to help you make confident insurance decisions. Comparison shopping should be easy. We partner with top insurance providers. This doesn’t influence our content. Our opinions are our own.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.

Things to remember...

  • All standard auto insurance policies are underwritten according to guidelines followed by the auto insurance industry
  • Many drivers are settling for only liability coverage in an attempt to save money
  • Even the bare minimum policy can be very good with the best auto insurance companies
  • Expensive vehicles cost to more repair and replace

Standard auto insurance policies are underwritten according to guidelines followed by the auto insurance industry. Actual accident and repair statistics are used to determine the cost of claims that will be filed by policyholders in the coming year.

Most drivers can find adequate auto insurance coverage at affordable rates. Few personal situations require the insurance shopper to choose between the best coverage and affordable rates.

Enter your ZIP code into our FREE car insurance comparison tool to find great rates today.

Components of the Best Coverage

Auto insurance shoppers should spend some time evaluating the personal situation prior to the quest to find a good auto insurance company. Too many drivers are reducing the coverage to lower the annual premium on the auto insurance policy.

Every driver must understand the components of good automobile insurance coverage.

After an accident occurs, the policyholder with insufficient coverage will have to pay for losses above the payout limits.

The Insurance Institute for Highway Safety tracks all accident and repair statistics. A visit to the website will reveal the perceived risk of driving each vehicle make and model.

Some vehicles do not perform well in crashes. Expensive vehicles cost more to repair or replace, and the insurance companies charge more to insure them.

  • Comprehensive and collision – Any insurance shopper with an outstanding car loan should carry the comprehensive and collision insurance components. Many lenders require this coverage until the loan is repaid. Few drivers can afford to replace the vehicle without the right auto insurance company coverage.
  • Liability component alone – Cars that are more than 10 years old can have a Blue Book value less than the annual premium for the collision and comprehensive components. An auto insurance policy consisting of only a liability component should be selected carefully. Every state requires drivers to carry liability insurance to cover damage caused to the property belonging to other people.
  • Uninsured/underinsured motorist – Slow economic cycles cause drivers to drop auto insurance because of difficult financial times. Wise insurance shoppers will ensure that this component is on the auto insurance policy. In an accident where the other driver does not have insurance, this component will pay the costs incurred by the policyholder.
  • Mitigate risk – Insurance shoppers must remember that the reason to carry auto insurance is to mitigate the risk of loss. Unfortunately, those who can least afford to pay for damages following an accident are the first to choose insufficient auto insurance coverage.

Free Auto Insurance Comparison

Enter your ZIP code below to view companies that have cheap auto insurance rates.

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Free Auto Insurance Comparison

Enter your ZIP code below to view companies that have cheap auto insurance rates.

 Secured with SHA-256 Encryption

Make Auto Insurance Affordable

Savvy insurance shoppers learn how to build an auto insurance policy with sufficient coverage and then make it affordable. After determining the best coverage, the insurance shopper will narrow down the choice of companies to the final three.

After determining the best coverage, the insurance shopper will narrow down the choice of companies to the final three.

Insurance company ratings are available on the A.M. Best website. Reputable companies are important when claims are filed.

  • Driver profile – A clean driving record is essential for the driver seeking affordable rates. Risky drivers pay more for auto insurance because of the perceived risk of loss. Accidents and moving violations on the driving record in the past three years will raise the insurance rates. A good credit history lowers the auto insurance premium because of the close association between responsible financial management and responsible driving habits.
  • Safety and security measures – Automobiles with factory-installed airbags, anti-lock brakes and a locked ignition earn healthy discounts from insurance companies. All of these features work together to lower the risk of loss. GPS tracking devices are required in some high-crime areas. Insurance companies offer suggestions to policyholders who want to save money on annual insurance premiums.
  • Multiple policies – Insurance companies offer many different types of insurance, including homeowners and life coverage. Drivers are wise to place all insurance policies with the same insurer. Substantial discounts are offered on all three types of policies when the policyholder has all insurance with one company.

Cautionary Statements

Wise insurance shoppers will not fall prey to the marketing tactics of unscrupulous insurance companies.

Certain quotes will have noticeably lower annual premiums. Comparison between the quotes will reveal the deficiencies in various areas of coverage. At first glance, the premium is more affordable.

Comparison between the quotes will reveal the deficiencies in various areas of coverage. At first glance, the premium is more affordable. Closer examination reveals risks that are not acceptable in most personal situations.

  • Liability insurance – State minimum requirements for liability insurance can be as low as $15,000. Auto insurance companies encourage all drivers to carry at least $100,000 of liability coverage. An umbrella insurance policy provides substantial liability coverage at lower rates. Drivers are wise to carry sufficient liability insurance to pay for losses in major accidents. Reducing liability coverage can result in a life-long debt if the unthinkable happens.
  • Policy deductible amount – Most auto insurance deductibles range from $250 to $1,000 per claim. Higher deductibles result in lower annual premiums. Some quotes will be returned with a high deductible amount to make the annual premium lower than other quotes. The policyholder must pay the deductible amount prior to receiving payment from the insurance company. A deductible amount of $1,000, or any other amount, must be affordable for the policyholder.
  • Multiple losses – A policyholder who sustains multiple concurrent losses must be able to afford all of the deductible amounts. Loss of a home, car, and business from a significant weather event can be financially devastating without sufficient insurance and planning. An amount equal to all of the insurance deductibles should be maintained in a savings account.
  • Teen drivers – Young people with good grades in school are rewarded with lower annual auto insurance rates. Advanced driver’s training lowers the risk of loss for young drivers. Those who are willing to complete these courses will pay lower auto insurance rates.

Choose a Good Combination

A small percentage of drivers will not be able to find affordable rates because of the perceived risk they present to the insurance companies.

Experienced auto insurance shoppers realize that persistence is required in the pursuit of good auto insurance coverage at affordable rates.

Auto insurance rates are set for entire classes of policyholders since it is against the law to target individual people for higher rates. Most insurance shoppers will be able to find the right combination of coverage and annual premiums.

Do your shopping online with our FREE car insurance comparison tool. Enter your ZIP code below to get started!

References:

  1. http://www.iihs.org/
  2. http://www.ambest.com/home/default.aspx
  3. https://www.acceptanceinsurance.com/our-products/auto-insurance/high-risk-auto-insurance/
  4. https://www.statefarm.com/insurance/auto/resources/what-affects-car-insurance-price
  5. https://www.progressive.com/homeowners/
  6. https://www.nationwide.com/auto-insurance-discount-pennsylvania.jsp