If you own a car and are driving on the road today, you need to have car insurance! It is essential in protecting yourself and it’s also the law. There are many different things that can go wrong when driving a car and auto insurance helps to ensure that if you are in an accident, it will not send you into bankruptcy!
Today, it is easier than ever to buy car insurance. You can go online to a variety of different websites, answer a few questions about yourself, your car, driving history, and pick the best coverage and rate that fits your needs best.
We will give you a 7 step process in buying car insurance that is guaranteed to make the process smooth and painless!
1. Decide how you want to buy car insurance
There are two ways to buy car insurance:
- From a captive insurance agent
- Through an independent insurance broker
If you already have an insurance policy (renters, homeowners, another auto policy) with an insurance company, it makes since to purchase your new car insurance policy through them. The only problem is they may not have the best deal. If you don’t shop around, you could end up paying much more.
2. Decide how much car insurance coverage you need
There are 3 basic steps you need to take when figuring out how much coverage you need.
1. Familiarize yourself with the types of coverage. Auto insurance is made up of several different types, some are optional, some are not.
- Liability coverage
- Personal injury protection
- Collision protection
- Comprehensive coverage
- Uninsured/underinsured motorist protection
- Medical payments
- Rental
- Rideshare
2. Consult your state’s minimum coverage requirements. All but 2 states in the US require you to have car insurance. Some states require different amounts of car insurance, which you need to know. Most states require $25,00 - $50,000 in coverage which will protect you in case you’re in a serious car accident.
3. Assess your risk. This will help you analyze how much coverage you actually need and at what rates.
- How much do you drive?
- Are you still financing or leasing?
- Annual mileage
- Your current assets
- Who else will be driving your car?
3. Fill out an application for car insurance quotes
In order to get quotes on car insurance, you will need to fill out an application. Some of the information you will need to provide is located below:
- Year, make, and model of your car
- Driving history
- Marital status
- Educations, highest degree earned, etc.
- Employment status, job title
- Previous insurance information
In some cases, there may be additional questions that could help you get discounts on your car insurance, they are:
- Full-time student with good grades
- Military veteran
- Clean driving record
- Anti-theft system in car
- Homeowner
- Multi policy discounts
4. Get your quotes
Quotes for car insurance can take an hour or only a few minutes. This is dependent on the company and complexity of your policy. After you have obtained all your quotes, you will more than likely see different options for deductibles and premiums for your policy.
The lower your deductible, the higher your premium and vice versa. You want to make sure that you find a spot that is comfortable for you in regard to your coverage and monthly cost.
5. Compare your quotes
When you’re examining your quotes, you want to make sure your price is reasonable, but that is not the only factor. You also want to make sure the company you’re going to purchase your car insurance from is reputable. The cheapest car insurance means nothing if the company your policy is under has horrible customer service and a bad reputation. You want to make sure and check out reviews and ratings of these insurance companies before you move forward and purchasing your policy. We recommend a credible source for insurance reviews such as AM Best instead of a simple Google search.
6. Pick a policy and get insured
After you have compared all your quotes, and done your research on each insurance company, it is time to choose your best option! Be sure you choose a company that you feel good about, has a fair price, and checks out from a review and ratings standpoint.
7. Cancel your old policy (if you have one)
If this process was to replace an old car insurance policy, make sure you wait until your new coverage is effective before you cancel your old policy. This whole process was started in order for you to lower your risk and save money, it would be a shame to cancel your old policy before your new policy started and be involved in an accident!