How to Shop for a Car with Cheap Insurance

Everyone loves a good deal, and when it comes to car insurance, there are some ways to save. However, it’s essential to remember that not all car insurance is created equal. To get the best coverage for the lowest price, there are a few things you’ll need to keep in mind. Here’s a quick guide on how to shop for a car with cheap insurance.

Know Your Coverage Needs

The first step in shopping for the cheapest cars to insure is knowing what coverage you need. There are three main types of coverage: liability, collision, and comprehensive.

Most states have minimum requirements for liability coverage, so you’ll likely need this no matter what. However, collision and comprehensive coverage are optional.

That said, if you’re financing your car or leasing it from a dealership, your lender will likely require that you have both collision and comprehensive coverage.

On the other hand, if you own your car outright, you might get by with just liability coverage. Of course, this leaves you vulnerable to an accident or theft—so it’s crucial to weigh your risks before making a decision. When it comes to car insurance, cheaper isn’t always better.

Shop Around for the Best Rates

Once you know what coverage you need, it’s time to shop for the best rates. Dozens of companies offer car insurance, so how do you know which is right for you?

Comparison Sites

You can use an insurance comparison site like Progressive or call individual agents in your area. ValuePenguin has compiled a list of the top 10 companies to check for the best value. All you need to do is enter your basic information (location, vehicle make, model, etc.), and they’ll provide you with quotes from different insurers in your area.

From there, it’s just a matter of finding the best price and signing up for a policy. Easy peasy!

Reassess Annually

But don’t stop there; be sure to shop around every year or so to ensure that you’re still getting the best rate possible. Insurance companies are constantly changing their prices, so what was once the cheapest option might not be anymore.

Ever-Changing Needs

Also, remember that your needs might change over time (e.g., if you move to a new state or buy a new car). By regularly shopping around for car insurance, you can be sure that you’re always getting the best possible rate.

How are Insurance Rates Calculated

Many factors go into calculating insurance, and contrary to popular belief, it’s more than the type of car you’re insuring.

Driving Record

If you’re a relatively new driver, it’s to be expected that your rates will be higher than those of an experienced driver. If you’ve been driving and have no incidents or traffic violations, you can expect your rates to lower over time. Issues such as speeding tickets, parking tickets, and driving without insurance can significantly increase your insurance costs. Additionally, if you tend to drive in adverse environments, wrecks are more likely. Be careful about when and where you choose to go.

Payment History & Credit Score

When you’ve got a mid to high credit score and a positive payment history, insurance companies consider you a low risk and are more likely to offer reduced rates.

Suppose your credit score is struggling, causing issues with your insurance rates. In that case, you may consider shuffling numbers elsewhere, such as refinancing your car to reduce your monthly payments to accommodate the higher insurance rates. Remember that your insurance rates will change as your circumstances change.

However, if you’ve allowed your insurance to lapse in the past due to non-payment, you will be charged more. Insurance agencies depend on consistent payments to ensure the money is available when a claim is made in the case of an incident.

Age and Model of Vehicle

The newer your vehicle, the more safety features your car is likely to have. With more safety features, like backup cameras, blind spot monitoring, and lane change assist, your risk of a collision is drastically reduced. However, the newer the car, the more it will cost to replace or repair it.

On the other hand, older cars are often considered more durable, are less expensive to repair or replace parts on when you are in an accident, and may be less expensive to insure. But, older cars lack many safety features we consider standard today. This factor is considered in the costs of your insurance premiums as just one part of a larger equation.

According to NerdWallet, the cars that best fit the mold for the lowest insurance rates include the Jeep Wrangler, the Honda CR-V, the Subaru Outback, and the Subaru Forester. While new models of these cars will have higher-rated safety features, so long as the maintenance has been kept up, used models will be less expensive to purchase and insure while remaining some of the safest cars on the road.

Location Where the Car is Parked

When you buy a house, the value is affected by neighborhood crime rates, police response times, and other factors. Your insurance is no different. If you tend to park your car inside a garage in a nice neighborhood with low crime and quick response, your rates will be lower.

However, if you park your car streetside on a busy corridor with a high rate of break-ins and collisions, the cost to cover your vehicle will be significantly higher. This is one of the more significant fluctuations within your insurance policy calculations because cities and communities shift and evolve regarding where criminal behaviors are most common.

Insurance Isn’t Complicated with the Right Team

Shopping for car insurance doesn’t have to be complicated or time-consuming—if you know what you’re doing. Working with a reputable agent with the credentials and experience to help you find the best deals can simplify this task and bring you peace of mind. Keep these tips in mind next time you’re looking for cheap car insurance, and you’ll be sure to find the best possible policy for your needs.