If you’re looking for a good deal on car insurance, you should compare offers from as many insurance companies as possible. This makes looking for cheap car insurance online the most effective way to reduce your insurance costs, as simply receiving quotes from different companies won’t affect your insurance rate.
What Auto Insurance Companies Offer the Best Rates?
Your personal situation and driving record can significantly affect your insurance rates and what company can offer you the best rates. For example, if you have an at-fault accident or a DUI on your record, some companies may be a better fit than others. A NerdWallet analysis reveals the best companies for drivers depending on their situation:
- Geico: The best company for drivers with a clean driving record but poor credit who are looking for the lowest possible coverage.
- Progressive: The company that offers the best rates for drivers with a recent DUI.
- State Farm:The company that offers the best rates for drivers with a recent at-fault accident
As an average, Geico has the lowest car insurance rates out of all major national insurers. Seven companies dominate the U.S. market, with over 65 percent of total auto insurance sales: Allstate, Geico, Farmers, Progressive, Liberty Mutual, and State Farm, which are widely available to the public, and USAA, which is only available to current and former members of the military, along with their families.
The average annual rates for six of the nation’s top auto insurers are:
- Geico: $1268
- State Farm: $1491
- Progressive: $1562
- Farmers: $1830
- Allstate: $2381
- USAA: $1169
However, it’s important to remember that some small auto insurance companies offer less expensive annual rates, on average. Some of the cheapest are:
- Secura: $823
- MMG: $839
- Hastings Mutual: $910
- Mutual of Enumclaw: $1082
- Central Insurance: $1090
How You Can Get Less Expensive Insurance Quotes
Compare.com says that these are some of the most effective ways to get cheaper auto insurance:
- Ask about discounts. Many companies have all sorts of discounts that may apply to you. For example, if you don’t use your car every day, you may want to look for a low-mileage discount. Whenever you are looking for low-priced auto insurance quotes, ask insurers about all their available discounts.
- Reevaluate your deductible. Per the Insurance Information Institute, raising your deductible means you will receive less coverage in case of a claim, but if you don’t drive that much and are willing to accept the risk, then it’s a sure way to reduce your car insurance spending.
- Reduce your coverage when appropriate. Reducing your covered amount just for the sake of getting cheaper insurance is not always a good idea, as you need full coverage for an auto loan or if you may find it difficult to pay for potential damages. However, if you own an older car, you can eliminate your collision and comprehensive coverages, as your car’s value is too low for them to be worth it.
- Adjust your policy according to various life changes. Some personal events can lower your auto insurance costs. For example, married couples or those living in a domestic partnership may get lower rates from some insurers. Also, if you move into a safer area, like the suburbs, your rates may reduce because you are at a lower risk of having an accident.
- Improve your driving record. Spending three to five years without any driving incident can get you lower insurance quotes.
- Improve your credit score. Most auto insurance companies see drivers with low credit scores as more prone to filing claims, so improving your credit score can get you cheaper auto insurance quotes.
- Let insurers track your driving habits. Some auto insurance companies offer discounts to drivers who allow them to track their driving habits through a remote device. While some companies offer a discount simply for allowing them to track you, others also analyze your driving habits and may give you a price reduction if your style puts you at low risk of causing accidents.
- Look online. The Zebra reports that buying auto insurance online can be less expensive, quicker, and easier.
Generally speaking, there are two main ways in which you can find the cheapest auto insurance quote for your situation, according to ValuePenguin:
- Make sure the amount of coverage you are looking for is appropriate for you.
- Ask many insurers for quotes and then compare them while also acknowledging any potential discount that may apply to you.
What Main Elements Influence Auto Insurance Rates?
Insurify mentions that the factors that most affect your car insurance costs are:
- Your home address: The area where you live can influence your car insurance rate, as some neighborhoods are considered as being safer and with a lower accident rate and therefore have lower insurance costs.
- Your age: Younger drivers usually have a much higher risk of producing accidents, mainly due to their inexperience behind the wheel. This is why teen drivers pay the highest rates by far, with the costs lowering as you gain more driving experience.
- The car you drive: Your car model can indicate how likely you are of filing various insurance claims, like accidents, repairs, or theft. Its price, safety test results, and average repair costs can significantly influence your insurance rates.
- Your job: Your career may also affect the cost of auto insurance, as some jobs require you to drive at nighttime, and this puts you at a greater risk of producing an accident.
- Your homeownership situation: Drivers who own their homes pay around 47 percent less on average for car insurance than those who rent.
- Your gender and marital status: Married people get into fewer accidents than single ones, on average, so their insurance rates are lower. Also, women tend to be less likely to drive dangerously or under the influence, meaning that their insurance costs are also reduced.
Finding a good auto insurance policy at a great price is not difficult if you know where to look. By researching quotes from both major and small car insurance companies, you can find the best rates for your personal situation and learn how to lower them even more in the future.
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