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What to know before you start shopping
Before you start requesting quotes, it helps to understand what coverage you’re legally required to carry and what additional protection makes sense for your situation.
Every state except New Hampshire requires drivers to carry a minimum amount of liability insurance, according to the National Association of Insurance Commissioners. But state minimums are often not enough to fully protect you financially after a serious accident, which is why many drivers go with full coverage instead.
Here’s a quick look at the main types of car insurance you’ll encounter when shopping.
Coverage Definitions
Key takeaway: Know your state’s minimum requirements and decide how much additional coverage you need before you start comparing quotes.
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How to shop for car insurance in five steps
Whether you’re buying car insurance for the first time or looking to switch insurers at renewal, these five steps will help you find the right policy without overpaying.
Step 1: Figure out how much coverage you need
Start by thinking about how much car insurance you need. Your state’s minimum liability requirements are the legal floor, but they may not be enough. For example, most states require only $25,000 per person in bodily injury liability, which can be used up by a single emergency room visit. The Insurance Information Institute suggests evaluating how you use your car, what risks you face and what assets you need to protect before choosing your coverage levels.
A good rule of thumb: buy as much car insurance as you can comfortably afford. Higher coverage costs more per month, but it protects you from paying thousands out of pocket after a serious accident. Here are four common coverage tiers to help you decide.
Minimum
$72 – $170/mo
Meets your state’s required liability limits to keep costs low, but doesn’t cover damage to your own car. Best for drivers on a tight budget with older, low-value cars.
Full
$153 – $365/mo
Adds collision and comprehensive coverage, which are typically required if your car is leased or financed.
Standard
$154 – $387/mo
Includes uninsured motorist and medical payments coverage, which is especially valuable since about one in seven U.S. drivers is uninsured. A strong option for drivers who want well-rounded protection.
Preferred
$183 – $453/mo
Offers higher liability limits, lower deductibles and extras like towing and rental reimbursement for maximum protection. Best for drivers with significant assets or newer, high-value vehicles.
If you’re not sure where you fall, start with full coverage and adjust from there. When comparing quotes, you can choose different coverage levels so you can see exactly how your rate changes.
Recommendation: The most important thing is to be legally protected on the road, but buy as much coverage as you can comfortably afford beyond your state’s minimum. According to the National Safety Council, the average cost of a disabling injury from a car crash is about $167,000. If your liability limit is $25,000 or $50,000, the gap between your coverage and the actual cost comes out of your pocket.
Step 2: Gather your information
Having a few key details ready will speed up the quoting process. Most insurers will ask for:
- Your driver’s license number and the license numbers of anyone else on your policy.
- Your vehicle identification number, or the year, make and model of your car.
- Your current insurance details, including your insurer, coverage limits and what you pay now.
- Your driving history, including any accidents or violations in the last three to five years.
- Your estimated annual mileage and how you use your car.
Step 3: Compare quotes from at least three insurers
Every insurer uses its own formula to calculate your rate, weighing factors like your driving record, age, location, credit history and vehicle differently. That means two companies can look at the same driver and come up with prices that differ by hundreds of dollars per year. Getting quotes from at least three carriers gives you enough range to see where the real deals are, and where you might be overpaying.
When comparing quotes, make sure you’re looking at the same coverage levels and deductibles across all quotes. A lower price might mean less coverage, not a better deal. You can get quotes directly from insurance company websites, through an independent car insurance broker or by using a comparison platform, which can compare side-by-side quotes from multiple insurers and also help you buy, switch and manage your policy.
Unlike many comparison sites, some platforms may offer privacy protections that prevent your information from being shared for marketing purposes. Check the platform’s privacy policy and terms before submitting your information. You should also confirm whether licensed agents are available if you need help choosing between policies or understanding your coverage options.
Step 4: Look beyond the price tag
The cheapest quote is not always the best choice. Before you buy a policy, check a few things about the insurer:
Financial strength: Companies rated “A” or higher by AM Best are considered financially stable and more likely to pay claims without issues.
Customer satisfaction: J.D. Power publishes annual auto insurance satisfaction studies that rank insurers based on real customer experiences.
Claims process: Read reviews about how an insurer handles claims. A company that’s hard to reach after an accident can cost you time and money.
Available discounts: Some insurers offer more car insurance discounts than others, which can significantly lower your price.
Your state’s department of insurance website can also show you consumer complaint data for each insurer, which gives you a sense of how well they treat their customers.
Step 5: Review your policy before you buy
Before you finalize your purchase, review the policy details carefully. Confirm your coverage limits, deductibles and listed drivers are all correct. Double check that any discounts you were promised are reflected in the final price.
Make sure your new policy starts before your old one expires so you don’t have a lapse in coverage. Even a single day without insurance can lead to higher rates in the future and may violate your state’s laws.
Key takeaway: Compare at least three quotes with the same coverage levels, check insurer ratings and reviews, and make sure your new policy starts before your old one ends.
Why quotes can change during the shopping process
If you have ever gotten a car insurance quote and then seen a different price at the point of purchase, you are not alone. This happens because insurance quoting is a multi-step process, and each step involves a different level of verification. Understanding how it works can help you avoid surprises.
A quote is an estimate, not a final price. When you request quotes, insurers use the information you provide, like your age, ZIP code, car details and coverage preferences, to generate an initial estimate. This is sometimes called an RC1 rating. It gives you a useful starting point for comparing carriers, but it is not yet your confirmed rate.
The carrier then verifies your information in stages. After your initial quote, the insurer checks your claims history and, in most states, your credit-based insurance score. This produces a refined second quote that is closer to your actual rate. When you select a policy and move to purchase, the carrier runs the most detailed check: your Motor Vehicle Report from your state’s DMV. This report returns your full driving violation history and is the biggest factor that can change your final price. If your record is clean, your rate often stays the same or even drops. If the report shows a violation that was not in your initial information, your rate may go up.
This process is standard across all insurers. Every carrier goes through the same stages of verification before confirming your final rate.
The best way to get a quote that closely matches your final rate is to provide complete and accurate information from the start. Have your driver’s license, vehicle identification number, current insurance documents, driving history and home address ready when you begin. And when comparing quotes, always use the same coverage limits and deductibles across carriers. A common starting point is liability limits of at least 100/300/100.
When to reshop
Your rate is not locked in forever. You should compare quotes again at every renewal, after a violation drops off your record, which typically takes three to five years, and after major life changes like moving, getting married, adding a teen driver or buying a new car.
How to shop for car insurance
Finding the right car insurance doesn’t need to be complicated. Comparison platforms can make it easier to compare quotes from multiple insurers and buy your policy entirely online, with no phone calls required.
Compare quotes. Answer a few questions and compare side-by-side quotes from multiple insurers in minutes. No long forms or phone calls.
Customize coverage. Adjust your coverage limits and deductibles to see how different options affect your price and find the right balance of protection and affordability.
Switch and save. Once you find the right policy, you can switch insurers. Some comparison services can help with the paperwork and cancellation process so you don’t have to handle everything yourself.
You can also monitor market rates and compare policies when it’s time to reshop. Many insurers and comparison platforms provide payment reminders and assistance with policy changes.
What factors affect your car insurance quote
Understanding how car insurance is calculated can help you anticipate what you’ll pay and identify areas where you can save. According to the NAIC, insurers evaluate risk based on two main things: underwriting and rating. Here are the biggest factors that affect what you’ll see when you get quotes.
| Factor | What is happening |
|---|---|
| Driving record | Accidents, speeding tickets and DUIs all increase your rate. A clean record for three or more years can qualify you for discounts. |
| Where you live | Urban areas with more traffic and higher theft rates tend to have higher premiums. Your state’s insurance laws and minimum requirements also play a role. |
| Your car | Newer, more expensive cars cost more to insure because they cost more to repair or replace. Safety features can help lower your rate. |
| Your age | Younger drivers, especially teens, pay the most for insurance because they have less experience on the road. Rates typically decrease as you get older. |
| Credit history | In most states, insurers use credit-based insurance scores to help set your rate. States like California, Hawaii, Massachusetts and Michigan prohibit this practice. |
| Coverage and deductible | Higher coverage limits cost more, but raising your deductible lowers your premium. |
| Annual mileage | The more you drive, the more likely you are to be in an accident. Low-mileage drivers often qualify for lower rates. |
How to save money when shopping for car insurance
You don’t have to settle for the first quote you get. There are several ways to lower your premium while still getting the coverage you need.
Compare quotes every time you renew
Car insurance rates change frequently. The company that gave you the lowest rate last year might not be the cheapest option this year. Compare quotes again when your policy is up for renewal.
Bundle your home and car insurance
Some insurers offer significant discounts when you bundle car and home insurance. Compare both bundled and separate policies to see which option gives you the best overall price and coverage.
Raise your deductible
Your car insurance deductible is the amount you pay out of pocket before insurance kicks in. Choosing a higher deductible lowers your monthly premium, so choose the highest deductible you could comfortably afford to pay if you ever file a claim. Many drivers pick a deductible between $501 to $1,000.
Ask about discounts
Most insurers offer discounts you might not know about. Common ones include safe driver discounts, good student discounts, low-mileage discounts, pay-in-full discounts and discounts for safety features on your car. Ask your insurer about every discount they offer, because not all of them are applied automatically.
Drop coverage you don’t need
If you drive an older car that has a lower market value, it may not make sense to carry collision and comprehensive coverage. Consider dropping full coverage if your car is worth less than $5,000. You can check your car’s value for free using Kelley Blue Book or NADA.
Build and maintain good credit
In most states, insurers use credit-based insurance scores to help price your policy. Keeping your credit in good shape can help you qualify for lower rates. This doesn’t apply in California, Hawaii, Massachusetts or Michigan, where this practice is prohibited and insurers aren’t allowed to use credit score to determine your rate.
Key takeaway: Compare quotes at renewal, bundle policies, raise your deductible and ask about every available discount to lower your car insurance costs.
Common mistakes to avoid when shopping for car insurance
A few common missteps can cost you money or leave you without the protection you need. Here are the biggest ones to watch out for.
Only looking at price. The cheapest policy might have coverage gaps, high deductibles or come from an insurer with poor claims service. Always compare coverage levels side by side, not prices.
Sticking with the same insurer out of habit. Loyalty doesn’t necessarily pay off with car insurance. Rates change, and your current insurer may no longer be the most competitive option for your profile.
Buying only the state minimum. State minimums are designed to meet a legal requirement, not to fully protect you financially. According to the National Safety Council, the average cost of a disabling injury from a car crash is about $167,000. One serious accident can blow past a $25,000 or even $50,000 coverage limit, leaving you personally responsible for the difference.
Skipping uninsured motorist coverage. About one in seven drivers on U.S. roads lacks insurance, according to the Insurance Research Council. If an uninsured driver hits you and you don’t have uninsured motorist coverage, you’ll pay out of pocket for your own medical bills and car repairs.
Letting your policy lapse. Even a short gap in coverage can result in higher premiums when you buy a new policy. Time your switch so your new coverage starts before the old one expires.
Recommendation: Don’t choose a policy based on price alone. Compare coverage levels, check insurer ratings and avoid letting your policy lapse when switching.
FAQ
How often should I shop for car insurance?
Is it better to buy car insurance online or through an agent?
How long does it take to get a car insurance quote?
Can I switch car insurance at any time?
Does shopping for car insurance affect my credit score?
What’s the minimum car insurance I need?
Should I bundle my car and home insurance?
What if I’m a first-time buyer with no insurance history?
Methodology
Statistics, rates and conclusions in this article are based on real-world car insurance quotes and industry data. Quote data may vary depending on the source, driver profile, location, insurer and coverage selections. Unless otherwise indicated, quotes shown are from drivers with clean records in the last 12 months. Quotes involving accidents, violations or credit use the last 18 months to ensure a reliable sample.
Editorial integrity
This article is intended to provide balanced, unbiased and helpful information about shopping for car insurance. Insurance rates, coverage options and eligibility vary by insurer and state, so consumers should compare multiple policies and review the terms carefully before purchasing.
