Tips On Buying...

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Car Insurance

Like most things in life, when it comes to car insurance, the cheapest is not always the best. While your ultimate goal may be to find the best rate possible, there is certainly more to consider than price alone.

The insurance industry is currently in a "soft market" which means they are competing for your business so, as the consumer, you are definitely at an advantage. But choosing a policy can be overwhelming, especially since you have so many options available to you. Not only are there different types of policies, there are different types of agents and companies for you to choose from, and rates can vary considerably.

1. Insurance Agents
The easiest way to shop for car insurance is to have an agent do the shopping for you. An agent will be able to assist you with determining the limits and deductibles that are right for you and to explain any coverage you do not understand.

There are two types of insurance agents. A captive agent represents a single insurance company and will usually only be able to provide you with a quote from that company. But don't rule out a captive agent - the rates can be competitive. An independent agent has access to many markets and will be able to provide you with quotes from several insurance carriers.

Skip the yellow pages. You want - and should have no trouble finding - an agent that comes highly recommended by a reliable source. Ask your friends, neighbors, co-workers and family members about their agents. People are always happy to tell you about good service as well as bad.

2. Direct Carriers
Another way to shop for car insurance is through a direct carrier. Direct carriers such as Geico and Safe Auto forego the agent and you deal directly with their customer service department, which may not be local. Direct carriers' rates may be lower since there is no commission being paid to an agent, but not only will you be sacrificing personal service and the sound advice of an experienced agent, you may never speak to the same person twice. If this is okay with you, then by all means, you should consider a direct carrier. Direct carriers may recommend that you carry only the minimum limits required by your state, but this may not be enough coverage. You don't want to be underinsured.

Before committing to a direct carrier, always research the company to find out whether they have had issues with customer service, claims service and whether there have been complaints regarding their billing practices. Keep in mind that some insurance companies, such as Progressive, can be accessed both directly and through an independent agent.

3. Shopping for Insurance Online
Should you shop for car insurance online? There's nothing wrong with obtaining quotes from reputable insurance companies over the internet as long as you feel comfortable with it. Most large insurance companies have websites that allow you to either obtain a quote or request a quote from a local agent. You should always be careful when providing personal information over the internet, but it may not be possible to obtain an accurate quote without providing some information. There are also online insurance companies, but you should be very cautious when dealing with an internet based company. One advantage to shopping for insurance online is the ability to obtain a quote and purchase a policy almost instantly. Make sure you do your research, and just remember, if it sounds too good to be true, it probably is.

When you are ready to start shopping, have your information ready; you'll need your personal information as well as the make, model, and vehicle identification number (VIN) of each vehicle you own. The agent or representative will ask you about your past driving history and claims. Be honest and answer all questions truthfully. You should disclose any accidents you've been involved in or claims even if they were on your parents' or another party's policy. The insurance company will find out about it in the long run, and your policy could be cancelled or worse, a claim denied, if you have withheld information.

Before committing to an insurance contract, here are some important questions you should ask the agent or company:

Will my rates go up if I have a traffic violation or make a claim in the first year? If so, find out what percentage the increase would be.

Do I qualify for any discounts? Insurers offer many types of discounts such as multiple policy, alarm credit, good student, good driver, accident free, marital status, mature driver, prepaid, and for being a member of certain organizations. But you won't know if you don't ask.

How is the company's claim service? This is the single most important feature of your policy. It's why you have insurance. If you have a claim, you want to make sure you can expect to be treated fairly and the claim is settled as promptly as possible. Find out of there are claim representatives locally based or if the company uses independent adjusters to settle claims in your area. Ask the agent outright if their customers have been satisfied with the claims service.

Ask for an explanation of any coverages you are unsure about and select the limits that are right for you. Some of the most misinterpreted coverages include Uninsured/Underinsured Motorist, Uninsured Motorist Property Damage, Loan/Lease Gap, and Medical Payments.

Finally, once you've purchased an insurance policy, review it carefully to make sure all of the drivers and vehicles are listed on the policy correctly and that you have the deductibles and coverage limits you requested. It is important that you have any errors corrected before you need to file a claim.