How to Buy Car Insurance

Car Insurance Buying Advice

James M. Flammang / autoMedia.com

They make it sound so easy, with advice just a phone call away—or available with a quick visit to a storefront agent. Even so, insurance shopping can seem like wandering into a maze. Why? Because unlike prices for other commodities, auto insurance rates aren't clearly stated. There's no simple price list.

Your cost for auto insurance is based upon a variety of factors, only a few of which have any relationship to driving. Your age, address, type and age of vehicle, occupation, whether you smoke and other factors can drive your total insurance cost up or down, often by a considerable sum. Depending on specific state laws, too, an insurance company can simply refuse to provide coverage at all, at any price, if they deem the risk excessive.

Policies vary, too. Not everyone wants—or needs—the same types of coverage, with the same limits and deductibles. Insurers vary enormously in terms of the discounts they offer, or the surcharges they might tack on for insuring a high-performance automobile, or one known to be popular with thieves.

One-Stop Shopping

Today, a growing number of consumers are comparison-pricing by computer. Shopping over the Internet has one big advantage: You can fill out applications with any number of insurance companies and get a price quote from each one. Cost isn't the only factor to consider, but in a couple of hours, you can come up with a batch of quotes, then decide which one should get your business. Many Internet search engines are linked to insurance-shopping services.

Policy Components

Here are the basic elements of an auto policy: