How to get insurance on a car?

Having car insurance is mandatory in most states and critical for protecting yourself financially. But sifting through the many coverage options to find the right policy can be complicated and time-consuming. Follow this detailed guide to make getting car insurance more manageable.

What Exactly is Car Insurance?

Car insurance is a contract between you and an insurance company that protects you against financial loss in the event of an accident or theft involving your vehicle. In exchange for paying a monthly premium, the insurance company will cover some or all of the costs to repair or replace your vehicle if it is damaged or stolen.

Here are the main types of car insurance coverage:

Liability insurance - Covers bodily injury and property damage claims when an accident is your fault. It satisfies state requirements and helps protect your assets.
Collision insurance - Covers damage to your vehicle from a collision, regardless of fault.
Comprehensive insurance - Covers damage to your car that is not from a collision, including theft, vandalism, fire, flood, hail, animal strikes, etc.
Uninsured/underinsured motorist insurance - Covers injuries to you and your passengers caused by an uninsured or underinsured driver.
Personal injury protection (PIP) - Covers medical expenses for you and your passengers after an accident, regardless of fault.
Gap insurance - Covers the difference between what your vehicle is worth and what you still owe on your auto loan if your car is totaled.

Deductibles - The amount you pay out-of-pocket before insurance coverage kicks in. Common amounts are $250, $500 and $1,000.

Why Car Insurance Matters

Having adequate car insurance is crucial because:

It meets your state's legal requirements for liability coverage. Driving without insurance can result in fines, losing your license, or impoundment of your vehicle.
It protects your assets like your home and savings. At-fault accidents often result in thousands of dollars in vehicle repair and medical bills. Without coverage, collection agencies could come after you.
It covers the other driver's expenses if an accident is your fault, protecting you from potentially massive liability costs.
It repairs or replaces your vehicle after collision, theft or other covered incidents. Paying thousands out of pocket would be financially devastating for most people.
It provides a safety net for worst-case scenarios on the road. Accidents happen, but insurance cushions the financial blow.

Car insurance is not legally optional. Plus it provides invaluable protection for your finances and peace of mind.

How to Get the Car Insurance You Need

Follow these key steps when getting insurance coverage:

Gather Your Driver and Vehicle Information

The company will need:

Driver details - Birthdate, address, marital status, license number, driving history, current insurer
Vehicle details - Year, make model, VIN, mileage, safety features, anti-theft devices, vehicle use
Driving habits - Average mileage, commute distance, frequency of vehicle use

Having this info handy speeds up the quote process.

Determine How Much Insurance You Need

Think about:

Your state's minimum liability requirements
The value of your car - Higher value warrant higher liability and collision/comprehensive limits
Your budget - Balance premium costs with sufficient coverage
Your tolerance for risk - Higher deductibles equal lower premiums
Your assets to protect - Home and savings value factors into liability needs

Discuss options with an agent if unsure what limits suit your situation. It's better to err on the side of more coverage when possible.

Choose How to Buy Car Insurance

You can purchase through:

Local insurance agencies - Buy in person and work with the same agent long-term.
Direct insurance companies - Buy directly online, via phone or mobile app. Convenient but less personalized.
Online insurance marketplaces - Compare multiple companies and quotes side-by-side. Wide choice but less guidance.

Think about what level of assistance you need and if you prefer building a relationship with one agent.

Get Quotes from Multiple Providers

Whether using agents, direct insurers or aggregates sites, always compare quotes from several companies including:

National insurers - e.g. State Farm, Allstate, GEICO
Regional providers - Often have competitive rates in certain states.
Lesser-known insurers - Can offer discounted pricing but check financial strength ratings.

More quotes mean more savings opportunities. Compare costs for the same exact policy limits and coverage to find the best deal.

Choose a Policy That Meets Your Needs

Review and compare quotes carefully looking at:

Premium cost - The lower the better, if all else is equal. Watch for hidden fees.
Coverage and limits - Ensure it matches your needs assessment. Don't sacrifice coverage to save money.
Deductible - Higher deductibles reduce premiums but mean you pay more out-of-pocket before coverage kicks in after an accident.
Discounts - Take advantage of discounts you qualify for like safe driver, defensive driving courses, good student, multi-policy, etc. But make sure base rates are also competitive.
Reputation and ratings - Only use established insurers with strong financial backing.

Opting for just the state minimum liability coverage is usually inadequate protection. Also be wary of dirt cheap policies from providers you are unfamiliar with. For the best value, choose a financially stable company using an optimal balance of price, coverage, and service.

Comparing Car Insurance Quotes Like a Pro

Here are insider tips for evaluating quotes and making savvy comparisons:

Adjust Variables to Get an Accurate Picture

To properly compare apples to apples:

Get quotes for the exact same coverage types and limits
Adjust deductibles to match across providers
Compare rates for the same policy term - 6 months or 1 year

Quotes can vary significantly if these key variables differ. Change them to isolate just the price differences.

Look Beyond the Premium Price

The base premium is not the only cost to consider:

Factor in deductibles - How much out-of-pocket expense are you willing to take on?
Watch for fees - Some insurers nickel and dime you with policy fees, installment fees, etc.
Consider discounts - Are you getting all the discounts you qualify for?
Check insurance company financial strength - Insurer solvency matters if you ever need to file a claim.

The premium is just one piece of the value equation. Weigh all monetary factors.

Compare Claims Servicing Reputation

How good is the insurer at:

Processing payments quickly and accurately
Keeping policyholders informed about claim status
Providing great customer service
Resolving complaints satisfactorily

Reputation for claims handling and service is worth researching.

Don't Sacrifice Coverage to Save Money

It's tempting to slash liability limits or drop collision on an old car to lower your costs. But inadequately insuring your assets is risky.

Only reduce coverage if:

You have assets like home equity and savings to cover an at-fault accident
Your car is worth less than $1,000 and repairs wouldn't be worth making
You can afford to replace your vehicle without coverage help

Otherwise pay a little more for peace of mind. Insurance premiums are much cheaper than the exposure of driving uninsured. Don't cut corners too closely.

Choosing the Right Car Insurance Company

With so many insurance providers vying for your business, how do you select the best fit?

Weigh Getting the Cheapest Rate vs. Good Service

The lowest premium isn't everything. Consider:

Price vs. customer satisfaction ratings
Ease of bundling policies for multi-line discounts
Availability of helpful agents
Claims handling reputation
Financial strength scores

Cheap limited carriers may not be there when you need them most.

Ask People You Trust for Referrals

Ask satisfied family, friends and colleagues:

Which companies have treated you well?
Would you recommend your insurer?

Firsthand positive experiences carry a lot of weight.

Opt for National Carriers or Local Agencies

Both have pros and cons:

National Carriers	Local Agencies
Wide consistent availability	Tailored guidance from a single agent
Competitive base rates	Support community businesses
Online convenience	Personal relationship builds trust
Possible lack of human interaction	Less likely to be upsold

Choose based on your preferences for online vs in-person service.

Compare Complaint Records

Check the National Association of Insurance Commissioner website for:

Complaint data by company and state
Average time to resolve complaints

Frequent, unresolved complaints are a red flag.

Read Sample Policy Documents

Get sample forms to check:

Clarity of language
Exclusions and limitations

Avoid vague, confusing policies. Know exactly what is and isn't covered.

Doing due diligence helps you find an insurer that balances service reputation with affordable pricing.

Top Car Insurance Companies of 2023

Based on industry data, here are some of the standout car insurance providers for 2023:

Company	Highlights
State Farm	National leader in auto insurance. Excellent claims process and customer service.
USAA	Top-ranked for customer satisfaction. Restricted to military members and families.
Amica	Consistently earns high ratings for service and claims handling.
Auto-Owners	Top choice among independent agencies for strong coverage and service.
Erie	Regional favorite for affordable rates and great agent relationships.

While there are many great options, these insurers frequently rise to the top for their positive policyholder experiences.

Mistakes to Avoid When Getting Car Insurance

As you shop for coverage, steer clear of these common missteps:

Not Understanding the Policy

Know exactly what you are buying. Don't gloss over the fine print or just listen to a quick overview from an agent. Take time to read and understand the full policy. Ask questions if anything is unclear before signing.

Choosing Based on Price Alone

A cheap policy isn't a good deal if the company has a bad claims handling record or financially shaky position. Weigh pricing, value, service and reputation together.

Overlooking Discounts

Ask your insurer to check you qualify for every discount like safe driver, good student, defensive driving, etc. Discounts provide big savings over time.

Declining Uninsured/Underinsured Motorist Coverage

It's shockingly common to be hit by an uninsured driver. Don't lose this financial protection by refusing uninsured motorist coverage over a small premium increase.

Exaggerating Your Driving Record

Never misrepresent your history or lie on an application to get cheaper rates. You can be cancelled for fraud after an accident. Be honest from the start.

Doing your homework before choosing a policy helps avoid regrets down the road. Know what you are buying, who you are buying from, and pay a fair price for reliable coverage.

FAQs

How much does car insurance cost?

The cost of car insurance varies depending on several factors, such as state coverage requirements, age, car make and model, driving record, credit history, yearly mileage, zip code, marital status, and gender.

According to Bankrate, the average cost of full coverage car insurance, which includes liability, collision, and comprehensive coverage, is $168 per month.

What factors affect car insurance rates?

Several factors can impact car insurance rates, including state coverage requirements, age, car make and model, driving record, credit history, yearly mileage, zip code, marital status, and gender.

Other factors that may affect car insurance rates include the type of coverage, limits, and deductibles you choose, as well as any discounts you may be eligible for.

How long does it take to get car insurance?

The time it takes to get car insurance can vary depending on the insurance company and your specific situation. Some insurance companies may be able to provide coverage immediately, while others may require more time to process your application and underwrite your policy.

What happens if I don't have car insurance?

If you don't have car insurance, you may face legal consequences, such as fines, license suspension, and vehicle impoundment.

If you cause an accident and don't have car insurance, you may have to pay for the damage out of your pocket and could get sued. You could also face higher insurance rates in the future.

Can I get car insurance without a license?

It is possible to get car insurance without a license, but it can be difficult. Insurance companies may require a valid driver's license to issue a policy, and some states may not allow unlicensed drivers to register a car.

If you are unable to obtain a driver's license, you may be able to get a non-owner car insurance policy, which provides liability coverage for drivers who don't own a car but still need insurance coverage.

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