Fast, Free Auto and Car Insurance Cost Comparison

All states require some type of automobile insurance before a registration and license plate can be issued. Therefore, if you own a car and wish to drive it legally on public roads, an insurance policy will be a necessary cost of operation. Insurance company lingo can sometimes be hard to understand but it’s important to learn if you want to minimize premiums while maintaining the necessary coverage.

Automobile insurance is really several different kinds of insurance wrapped up in one neat package. The primary components of an automobile insurance package are bodily injury, property damage, collision, comprehensive, medical, personal injury and uninsured motorist coverage.

• The bodily injury portion of your policy will cover expenses incurred if you’re at fault in an accident and cause injury or death to another person. Most states require that you carry minimum amounts bodily injury liability coverage – usually between $15,000 and $25,000. Potential liability costs can often range much higher than $25,000 and if you have regular income and own property it is often recommended to obtain far more than minimum coverage in this area.
• Property damage insurance covers any damage you cause to another person’s property. This could be their car or a fence or mailbox. Many states require a minimum of $5,000 coverage but at least $25,000 is recommended.
• Collision coverage will cover your own losses in case of an accident. One of the main reasons people buy insurance is to take care of costs involved in repairing their own vehicle. The older and less valuable your car is, the less collision coverage you’ll need. Collision coverages are also available with deductibles. The deductible is the amount of ‘out of pocket’ expense you’ll pay toward repairs before collision coverage kicks in. Larger deductibles will lower the collision premiums.
• Comprehensive coverage pays for losses sustained by your car in instances other than collisions and traffic accidents. Examples of these instances include; theft, fire, storm damage, vandalism, explosions, earthquakes, floods as well as other similar occurrences.
• Medical coverage pays doctor and hospital bills and possibly funeral expenses incurred as a result of an accident involving your vehicle. Some people will minimize the amounts of this coverage because they already have excellent health insurance coverage through their employer. In this case it would be wise to consider that your passengers may not have the same excellent medical insurance.
• Personal injury coverage is much like medical coverage except that it is broader coverage. In addition to covering doctor bills, personal injury coverage can cover lost wages or pay to hire help in the home if the accident victim is unable to carry out the daily duties at home.
• Uninsured motorist coverage helps to cover you if you are involved in an accident involving an uninsured motorist.

When purchasing automobile insurance you should evaluate each of these components to determine your individual need and assess how much coverage you can afford. Accepting higher deductibles when available and agreeing to lower coverage limits can lower your premiums as long as you are comfortable with the amount of automobile insurance coverage you’ll have.

While the aforementioned types of coverage are major factors in your car insurance cost, there are many other factors that will contribute to the final price of your car insurance premiums. These items help insurance companies to determine risk. Following is a list of things that can affect your car insurance cost. Some of them you can control and change. There are others, however, over which you’ll have no control.

• Your driving record – drivers with numerous tickets and moving violations are statistically less safe than drivers with clean records. More points on your record translate to higher risk for the insurance company.
• The type of vehicle you’re insuring – the more expensive a car is to repair or replace the higher the car insurance cost will be.
• The geographic area where you’ll be purchasing insurance will have an effect on your car insurance cost. People who live in areas with more traffic, higher incidences of accidents and elevated theft reports will pay higher premiums.
• Principal driver’s age – statistically, drivers younger than 25 will pay higher car insurance costs because they are at greater risk of having an accident.
• Gender and marital status – numbers also show that women are less likely than men to have an accident and married people are less likely than single people to be involved in a traffic mishap.
• Previous claims – drivers who have filed previous claims are more likely to file again.
• Occupation – certain occupations carry more risk of accident than others. For example, a delivery man on the road all day is at more risk of accident as opposed to a secretary at a desk all day.
• Distance of commute – it’s only logical that the longer your drive to work the more at risk you are for an accident.
• Driving experience – again, logically and statistically speaking, people with more driving experience are less likely to have a traffic mishap.
• Currently insured - any lapses in auto insurance coverage will increase your premiums.
• Business use of vehicle - business vehicles typically spend more time on the road. Therefore, an accident is more likely.

These are just some of the factors that can influence your car insurance cost. Some may seem unfair but, it’s important to remember that insurance companies are for profit organizations and in order to remain solvent they must minimize risk. All the above factors help to statistically analyze your risk for a traffic accident and the likely-hood that you’ll file a claim.

There are some discounts offered by many insurance companies. Taking advantage of these discounts can help to reduce your car insurance cost. Also, remember to ask your agent if there are any other discounts for which you might qualify.

• Theft devices - many insurance companies offer discounts if your vehicle is equipped with an antitheft device
• Multiple car discount - if you purchase insurance for multiple vehicles from the same insurance company they’ll often give you a percentage discount.
• Driver training discount - good training results in fewer accidents.
• Defensive driving class discount - defensive driving will help you avoid accidents caused by the poor driving habits of others.
• Good student - good students are typically more conscientious drivers.
• Infrequent driver - less time on the road can translate into reduced risk of traffic mishaps.
 

These are just a few examples of discounts available that can lower your car insurance cost. Remember to explore all the possibilities. Ask your agent about other discounts for which you may be qualified. Keeping your car insurance cost low is important but, make sure you have all the coverage you need. If you get into an accident and find yourself underinsured, all your car insurance cost savings will be for naught..