It's easy to get stuck in a rut with your auto insurance, especially if you have few complaints about your current insurance company.
But failing to do a car insurance comparison of rates at least once a year can cost you a lot of money – potentially hundreds of dollars.
Why should you compare auto insurance? Here are some key reasons:
Each time you compare car insurance quotes, you receive a range of price for identical coverage. Why do rates vary from one company to another for the same coverage?
When determining your rate, a car insurance company looks at factors such as your age, driving record and claims history. The insurer also notes the type of car you drive and other factors, such as where you live, how many miles you drive each year, and the insurer's own claims history (for your model vehicle and geographical location).
Each auto insurance company has its own formula for determining how such rating factors affect premiums. That means rates can vary considerably from one car insurance company to the next, even for the exact same type and level of coverage. The difference can be a few hundred dollars for older drivers with good records -- and thousands of dollars for younger drivers or people who have major violations or accidents.
This is a key reason why it's so important to compare car insurance rates.
Car insurance companies stay competitive by changing their rates. If one company begins offering "accident forgiveness" or "pay-as-you-drive" insurance, you can bet that its competitors will soon find ways to lower their own rates so they remain attractive to drivers looking for cheap car insurance.
On the flip side, your car insurance rates may rise due to statewide increases by your auto insurance company. However, just because your insurer got permission to raise rates doesn’t mean other insurers did.
By shopping around, you may find your current car insurance company's rate isn’t the best and that another insurer's rate is lower today than it was the last time you compared car insurance rates.
As your life circumstances change, so do your auto insurance needs. A single, 22-year-old driver usually requires a different level of coverage than a 40-year-old married parent. This is another reason it's foolish not to compare car insurance rates.
Many life events may trigger the need to undertake a new car insurance quotes comparison. This includes:
Auto insurance comparisons can help you find the best coverage for your changed circumstances at the cheapest rates.
In the past, auto insurance rate comparison involved making several phone calls or visiting several insurance agents in their offices. Today, it's easy to compare auto insurance rates online, at your convenience. You can visit individual insurance company sites, or you can use an online tool to see several carriers' quotes side by side.
When you compare insurance quotes online, you get an immediate answer about your auto insurance options. You can also purchase your policy online, putting instant insurance coverage at your fingertips.
For example, by plugging your ZIP code into Insurance.com’s car insurance comparison tool, you can quickly compare insurance rates from some of the best auto insurance companies. You can swiftly see if you’re paying too much with your current car insurance insurer and should switch carriers. You potentially could save hundreds, if not much more, by simply taking time to compare car insurance quotes.