Across the country, auto insurance rates are rising due to inflation, changing driving habits, and disrupted supply chains. Therefore, you may be more inclined to shop around for your auto insurance policy to find a cheaper rate. However, figuring out which carrier best suits your needs can seem daunting with hundreds of companies to choose from.
You may worry about picking a company and having a bad claims experience. You may worry about your rates increasing even after changing companies. And what if you choose types and levels of coverage that aren’t right for you? Insurance can be complex, but you can learn how to find the best car insurance company for your needs. Bankrate is here to help.
How to choose the best car insurance company
Although almost all states legally require drivers to carry auto insurance, the company you choose, the types of coverage you select, and the levels of coverage you purchase are unique to your situation. Every driver has unique needs, but insurers also have different strengths. When looking for the best auto insurance company for your particular situation, there are many factors to consider, and the focus of each factor depends on what you need as an individual. Bankrate can show you how to navigate the car insurance buying process.
1. Determine your unique needs
To choose the best auto insurance company, you must first determine your unique needs and financial situation. Assessing your situation can help you narrow down the selection of insurers and focus on the one that offers the coverage options you need.
For example, if you are a defensive driver, you might want to look for a carrier with a telematics program. These programs track your driving and can reward safe habits with a personalized discount. As long as you drive safely, this could help mitigate the rising auto insurance rates that many drivers are facing.
Households with teenage drivers might want to seek out insurance providers with discounts or programs aimed specifically at young drivers. If you prefer to keep your insurance as easy to manage as possible, finding a company that offers many products could help you bundle more policies. There are endless combinations of personal criteria for an auto insurance company, and understanding your unique perspective could help you determine which companies to research further.
2. Find insurers that meet your needs
Once you know your needs, you can start researching insurance companies that might fit your situation. You may find that some of the larger car insurance companies, which may be available in much of the country, could be good options. Or you can opt for smaller car insurance companies, which tend to be more regional. Researching companies that offer coverage in your area can help ensure that your carrier aligns with your needs.
If finding a cheap car insurance company is high on your agenda, you might want to spend some time analyzing discounts. Most companies offer at least some discounts on car insurance, but finding a carrier that offers several savings options that you qualify for can help you control your premium.
3. Check Trusted Third Party Ratings
You can use available verified third-party ratings to take the guesswork out of finding companies with solid customer service and financial strength ratings. Using third-party data in your research provides a more comprehensive approach to choosing a provider and gives you unbiased data for your review.
Ratings such as JD Power’s provide independent and unbiased assessments of customer experience with popular car insurance providers. AM Best is another example of a third-party company that analyzes the performance of an insurance company in more detail. Specifically, AM Best looks at a carrier’s historical financial health and strength, which can reassure you if a carrier has a history of paying claims.
4. Consider experience
Another aspect to consider in your search is how you will interact with a company once you are insured. Thinking about how you prefer to interact with your carrier — by mobile app or online portal, over the phone, or in person — can help you find companies that offer these services.
If you like to run things digitally, for example, choosing a company with a robust digital app that lets you pay bills, request changes, and file complaints could keep you happy with the interaction with the company. Wanting digital tools and choosing a company that doesn’t offer an app or online portal could lead to dissatisfaction.
5. Compare insurance quotes based on coverage
The average cost of auto insurance can vary widely from insurer to insurer depending on a variety of pricing factors, including the type of vehicle you drive, your driving history, and the specific coverage you choose. The carrier comparison highlights the difference in rates, but it also shows which carriers offer the coverage options and discounts you’re looking for based on your needs. Be sure to compare quotes based on the same coverage types and levels to know you’re getting the most accurate representation of costs. Comparing a minimum coverage policy with low liability limits to a full coverage policy with higher liability limits will not help you determine which is cheaper since you are not comparing the same levels of coverage.
If you’re not sure how much car insurance you need, it may be worth working with an insurance agent. A licensed insurance agent can listen to your situation, understand your situation, and recommend appropriate types and levels of coverage. Once you are sure of the types and levels of coverage you need, you can match those levels to any quotes you request. Keep in mind that some companies may not offer certain endorsements, so you may not be able to get your quotes in exactly the same way.
The bottom line
Buying auto insurance can be daunting, but it’s often a good strategy to align your coverage and business with your needs. Plus, shopping around might help you figure out what a competitive rate looks like for your policy and might help you find cheaper coverage. The key to finding the right company for you is to understand your needs, do your research, and compare quotes on a range of measurements. If in doubt, working with an insurance agent could help you navigate the process.