Car Insurance Buyer’s Guide

Compare Auto Insurance Rates

My car insurance buyer’s guide will help you comparison shop auto insurance rates.

Most car buyers end up shopping for car insurance after they’ve already bought a car. This is one of the biggest mistakes car buyers make and end up costing them more money than they budgeted up front.  Once you have a general idea of the car you would like to buy, you should then shop for insurance rates.

The law requires full coverage car insurance if you’re financing a new or used car through a bank, lender, or finance institution. If you don’t check first, you could end up paying a higher monthly payment for insurance then you’re actually paying for your vehicle.

Benefits of shopping car insurance online

Benefits of Shopping Car Insurance Online

Depending on your past driving record and the car you want to buy, the short answer is, “car insurance can be costly,” especially when purchasing a brand-new vehicle.

The internet makes it easy to compare shop car insurance rates so you can choose the absolute best coverage for you and receive it at the lowest possible price.

Benefits of shopping for  auto insurance coverage online:

  • Budget – Auto insurance is part of your monthly car ownership cost. Knowing how much your insurance coverage will cost you before buying a car will help you budget the amount with your monthly car loan payment. Depending on where you live, the vehicle, and your current driving record. Your insurance costs could be $1,500 or more a year. That’s $125 on top of your monthly car payment. If you let a car dealer close you on the higher side of your payment budget, this extra $125 will push you over.
  • Low pressure – You don’t have to deal with pushy or overly aggressive agents just looking to make a sale. Car insurance agents, like any salesperson, may lean or direct you in a specific direction, which may not be right for you.
  • Free price quotes – Online insurance companies provide free, no-obligation quotes. This allows you to research, price, compare, and choose a policy without being hassled or pressured into buying anything from anyone.
  • Convenience – Some of us do our best online shopping from home at 2 a.m., in our underwear.
  • Same coverage – A common misconception is that online insurance companies provide less reliable coverage than brick-and-mortar companies. This is not true; same company = same reliable coverage. No matter whom the coverage is through, we always recommend reading the fine print on any auto insurance policy.
  • Comparison shopping – It involves comparing several companies to determine which insurance coverage offers the best value for your money.
  • Discounts – The same insurance discounts are available online as in brick-and-mortar offices.
  • Customize – If you’re like me, you like to run through multiple scenarios, explore all your options, or change your mind at the last minute. Online insurance shoppers don’t have to worry about spending hours in an agent’s office, navigating different scenarios, and looking for the best deal. Online customization features allow consumers to create various scenarios to choose which insurance coverage is best for them.
  • Savings – Last but certainly not least, the best reason to shop for car insurance online is the price. An online insurance company doesn’t have to staff offices, pay insurance agents, or pay utilities. These companies pass these savings on to consumers, making them often cheaper than their competition.
How to buy a new car under factory invoice price and get a great deal.

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If you don’t have insurance coverage or let it lapse

You don’t want to be caught driving without auto insurance, it is illegal and most states have very hefty penalties. Many insurance companies will not provide you with insurance coverage if you’re not currently insured.

Be cautious of fly-by-night companies offering cheap policies from unrated insurance carriers. These companies may not be in business if you ever need to file a claim. It’s well worth paying a little more to go with a well known carrier and the peace of mind if something ever happens you’ll be covered.

There are only a few well-known companies that will provide you with a free, no-obligation rate quote and consider providing you insurance coverage if you’re not currently insured.

Best car price quote sites from Auto Cheat Sheet.

Car Price Quotes

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Does credit history affect auto insurance rates?

Not only does your credit history affect the interest rate you will pay for a car loan, it will affect the price you pay for auto insurance also.

Everyday more and more car insurance companies are taking into consideration your personal credit history and score when you purchase, renew or change your auto insurance policy. Insurance companies have found a direct correlation to people with bad credit tend to also carry a higher insurance risk by filing more claims on their insurance policies.

This can also be a very good reason to shop car insurance rates to find a better deal. If you have some bumps in your credit history when you last purchased car insurance and your credit history has since improved, it’s time to explore your options. An insurance company is not going to call and offer you a discount once your credit history improves. Knowing and maintaining what’s on your credit reports is a positive thing and will help you throughout your life.

Step-by-step walkthrough on how to buy a new car | New Car Buying Cheat Sheet

Use a trusted online insurance company for free quotes.

The companies I recommend are leaders in the industry. They’ll provide you with free quotes so you can review and compare prices and make a good buying decision.

Make sure you provide them with accurate information and you will want to enter the same information to each separate company. The goal is to get price quotes from each company on the same type of coverage. You also want to be honest, don’t think you can “forget” about a speeding ticket you received a few months ago. They will find out and possibly raise your rate or cancel you altogether once you’ve already been approved.

Additional car insurance shopping tips

  • Check insurance rates before buying a new or used car, not after you’ve already committed to the vehicle.
  • Shop for coverage frequently or whenever your personal circumstances change.  Let’s say, you need to insure a teen, get married, reduce you travel commute, or add another vehicle to your policy.
  • Insurance premiums will vary greatly by make and model of a vehicle, choose wisely.
  • Both you credit rating and driving record have an impact on the price you’ll pay for car insurance.  For the best premiums, you will need to have at least three years of clean driving history.
  • Ask the insurance agent which driver to be assigned as the principle drive to which vehicle in your household. Matching those individuals’ driving records and car values might save you money. Pairing a lower-value car with the driver who commutes the longest distances, for instance, may cost less than giving that driver the higher-value car.  You may find that matching a teenager to the oldest car in the household will save you money.
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