All drivers want cheap car insurance. After all, who wants to pay more for a product that is being sold cheaper somewhere else? While it certainly would be optimal to call one insurer and expect them to offer the least expensive rates, it is unlikely for such a random occurrence. Not every company is dedicated to giving out low rates, and so the great search begins. When looking to buy really cheap auto insurance, all consumers should know there isn’t one flat out cheapest insurer out there. Breaking down all the ways a driver can attain inexpensive rates makes sense and shows just how any driver can get cheap rates.
Scenario: Your friend just told you how excited she is to finally be getting her auto insurance at a cheap rate, but doesn’t tell you how much she’s paying. You grimace and wish it was you getting the deal. You quickly change the subject to avoid anger.
Truth #1: This friend hasn’t come clean with everything she has put into finding this cheap rate, and there are many possible explanations as to why. The first aspect to focus on is, did she compare her new found rate with what other companies offer? If not, there’s a good chance she’s not getting the lowest rate possible. Completing a thorough comparison of local companies will ensure you aren’t missing out on cheaper auto insurance. Using our comparison tool, you can compare at least four local companies’ prices to each other.
Truth #2: What is your friend’s driving record like? It is possible that she has been given a low rate as a reward due to good driving. Even receiving just one traffic violation ticket will cause a driver’s insurance rate to go up, and causing an accident will cause an even higher rate. Perhaps her record has fewer errors than your record. How many tickets and accidents have you had in the past year or two? A spotless (or close to it) driving history indicates to the insurer the driver is a safe one and has a low risk of ever needing to file a claim. The insurer will give this safe driver a cheaper insurance rate.
Truth #3: The personal status of your friend could also play a factor. Is she under 25 years of age or older? Are you male or female? Is she married? As random as these may seem, they play a large role in paying a low price to insure a vehicle. Young drivers will always pay a high price for insurance, because they typically file more claims than older drivers. Around the age of 25 years is when the insurance companies start to lighten up on pricing. And, it’s true that males will pay more for their insurance than females. Males, especially younger males, statistically are involved in more reckless behavior than their female peers. Finally, married drivers pay less for insurance than single people do. They’re more cautious with or without their spouse in the vehicle as they drive.
Truth #4: Are you and your friend neighbors? If so, then you will have that same thing going for you. If you are not neighbors and live in another town, there is a good chance that this will affect your ability to find a cheap rate. Insurance companies use your residential dwellings as part of their process to determine your rate. Living in a town or city with high crime will only get you high rates, and if your friend lives in a low crime area, then you can be sure that this attributed to her low rate.
Truth #5: What kind of car does your friend drive in comparison to you? And how often does she drive it? Your vehicle information plays another role in the ability to get cheap insurance. An expensive car will be more expensive to insure, while a modest car may not be quite so much. This is because a luxury car also costs more for the insurance company to repair or replace. Cars with safety features will be qualified for discounts, compared to cars that are too old and weren’t equipped with the latest safety features.
The second part to this truth is the number of miles put on the car during the calendar year. Think about the relationship between traveling a high number of miles and accidents. The more a driver is on the road, the higher the chances of being involved in traffic incidents. Therefore, it costs the driver less to insure a vehicle that doesn’t drive very often.
Truth #6: How much coverage did she purchase? Purchasing only the state minimum requirements will definitely get you the cheapest rates, but it may not be the coverage you desire. Your friend may have only purchased this minimal amount while you are carrying full coverage. Cheaper insurance in terms of how much coverage is purchased may backfire if there is ever a major accident. Usually minimal coverage will not cover the expenses involved in a major accident, especially if you are at fault. There are medical bills and property repairs (possibly of both parties) that would need to be taken care of. Some states only require drivers to purchase $10,000 of property damage, but the total cash value of some of the cars on the road today are far more than that amount. However, the final decision of coverage purchased is decided by the policyholder, usually according to their budget.
Don’t get in the habit of comparing your car insurance policy to someone else’s policy, especially when all of these factors between the two policyholders are different. The only comparing that should be done is by insurer to insurer for the policy you want to purchase. Who offers the lowest price for the coverage YOU want? Check out our comparison tool on our homepage or at the top of almost any page on our site by entering in your local zip code. We pride ourselves on our ability to get any driver the cheapest car insurance in town.