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Finder’s car insurance team has spent thousands of hours researching policies and analyzing hundreds of thousands of quotes (for real!) from car insurance brands across the US. In our research, we found discounts that could save you up to 52% off what you’re currently paying. Most drivers who used Finder reported they saved at least $500 a year by switching.
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What's in this guide?
How much does car insurance cost?
The average cost of car insurance is $1,065 per year, or $89 a month, but rates vary based on your car, driving record, demographics and other reasons. The biggest factors that affect your rate include:
- Your car. Your car’s make, year and model are the biggest factors in your insurance rates. Its current value and whether you own it will also affect your coverage costs and how much coverage you need.
- Your location. Where you live and drive is the second biggest factor for rates. Each state sets minimum insurance requirements. And even rates in different ZIP codes in the same city can vary by hundreds of dollars. Living in a high-claims area, like a big city or an area with a high rate of uninsured drivers, can also drive your rates up.
- You. Your demographics affect your rates more than you might think. In most states your rates are based on your age, gender, marital status, credit score and other factors that have nothing to do with your driving. Insurance companies use these factors to predict your risk level and set your rates.
Car insurance rates
If lowering your car insurance premium is your main priority, switching car insurance could be one of the best ways to save. Compare how much price differs between insurers with sample auto insurance rates for California drivers.
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How to compare auto insurance
Ever wonder why insurance policies and quotes are different for every insurer? You might not be comparing equivalent rates. Make sure you’re comparing apples to apples to get the best insurance quotes.
- Consider the biggest discounts. To get your business, many insurance companies quote the lowest possible price. It might, say, include a hefty 25% car insurance discount for buying online. However, other insurers might offer the same discount, but not include it in your quote. While it’s good to consider discounts in your initial search, make sure you’re also considering the final price too.
- Make sure you’re comparing apples to apples. When you’re comparing quotes, make sure you put in the same amount of info on each quote. Check to see if you’re getting any extra coverage or missing any discounts, and that the deductible and pay schedule are the same.
- Look for specialist insurance. Driving for business, rideshare drivers and adding on coverage can all affect your premiums. If you’re not getting good rates from the big national companies, look for a company that specializes in the coverage you need.
- Balance the best coverage with the cheapest rates. The goal is to get the right coverage for you with the best deal. But consider every factor that might be important, such as how easy it will be to make claims, or whether you’ll pay extra for perks you need. It’s helpful to consider at least two to three of the cheapest quotes with the same level of coverage you need.
- Consider customer satisfaction. While price leads many people to switch insurance, issues with billing or customer service are another big reason drivers shop around. When you’re comparing quotes, look into each company’s customer satisfaction ratings to avoid denied or lengthy claims.
- Check financial strength. The financial strength of an insurance company is a good indicator of how likely it is to be able to pay out claims. You can look to AM Best, Moody’s and Standard & Poor’s for different independent financial strength ratings.
Compare car insurance where you live
Car insurance rates across the US can vary a lot based on where you live. The national average is $1,300 per year, but drivers in Maine pay only about $864, while drivers in Michigan see premiums averaging $2,394.
Shopping for car insurance often starts with finding your state minimum required coverage and then adding extra coverage you’d like. Compare auto insurance rates by state and even by ZIP code.
Explore in-depth car insurance guides
No one wants to overpay for car insurance. And it’s hard to compare policies to get enough coverage at the right price. The best way to save is by shopping around.
1. Start with customized quotes
Different people can pay drastically different prices for car insurance — even at the same company. Compare car insurance companies that can offer you the best deal for you individually, not across the board.
You can also compare local insurance companies, which tend to have higher customer satisfaction rates than big-name counterparts and could potentially have lower rates.
2. Hunt for discounts
Many insurers offer discounts to drivers for a variety of reasons, such as having a clean record, paying an annual or semi-annual premium all at once or being a safe driver for a certain period of time. Most companies also offer a multicar discount if you insure more than one car belonging to your household with it.
If the insurance company you’re with offers more than just auto insurance, consider bundling more of your policies with it. For example, you could take out homeowners or renters and car insurance with the same company and save on one or both.
3. Get the right coverage for your car
Make sure you get the appropriate coverage for the car you’ve driving. Consider skipping collision insurance or comprehensive coverage for an old car that isn’t worth much. The value of your car determines your maximum payout if it’s stolen or totaled, meaning these policies are not very useful for older vehicles.
4. Raise your deductible
A higher deductible means lower premiums. But if you get in an accident, you will have to pay more before insurance kicks in. Make sure that if you raise your deductible you can still cover it in case you need to file a claim.
For example, if you have a $500 deductible on a $2,000 accident, you’d pay $500 before your insurance company covers the other $1,500. With a $1,000 deductible, you’re paying $1,000 and your insurer covers the remaining $1,000.
5. Look into pay-per-mile insurance
If you drive under a certain amount of miles every year, you can tell your insurance company and possibly qualify for a low-mileage discount. This is a common discount that many drivers actually qualify for but are not aware of.
If you only use your car for occasional short trips, you can sign up for a usage-based insurance program that determines your rates based on how much you drive.
6. Avoid accidents and tickets
If there are any surefire ways to make your premium go through the roof, these two are it. If you live in a high-risk area or are prone to getting in accidents, look into an insurer that offers accident forgiveness — that way your first accident won’t make your premiums go up.
7. Take a defensive driving course
If you have a less-than-stellar driving record, sign up for a defensive driving class. Most insurers will give you a discount on your premiums. Your local DMV can point you in the right direction.
8. Combine policies with your parents or spouse
Look into being named as a driver on your parents’ insurance. Their rates might go up, but it could be less than keeping your solo policy.
Because married drivers tend to get in fewer accidents, you’ll often get a discount on your premium just for getting engaged or married. Married couples can also potentially save by combining their insurance on one policy to save money.
9. Check and maintain your credit history
Most auto insurance companies take your credit history into account for your pricing, unless you live in California, Hawaii or Massachusetts. The reasoning behind it? Some research shows that people with a higher credit score tend to make fewer claims.
10. Choose the right car
Newer, used inexpensive cars tend to be cheaper to insure. Luxury cars have a higher sticker price and tend to cost more for as long as you use it.
It’s usually worth buying a cheaper car, especially if you’re a young driver. If you haven’t purchased a car yet or are getting ready to shop for a different car, compare cheap-to-insure models against ones you’re considering. The insurance price differences might surprise you.
What car insurance coverage do I need?
Bodily injury liability
Covers costs from injuries you cause another person in an accident.
Property damage liability
Covers damage you cause to someone else’s property in an accident.
Personal injury insurance
Covers medical services after an accident, regardless of fault.
Covers costs caused by a driver if their insurance can’t pay enough.
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