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It might be convenient to auto-renew an existing insurance policy, but failing to explore other options could result in missed savings. Even shopping around and accepting the first quote might not be the best strategy.
For example, CarInsurance.com notes that annual rates for drivers with good credit can vary significantly, ranging from $1,381 to $2,509 depending on the insurer, reflecting a difference of more than $1,100.
Howard Goldberg, vice president of the customer solutions center for Plymouth Rock Assurance, which offers car and home insurance in six Eastern states, advises obtaining multiple opinions to ensure the right insurance policy is selected.
Consumers often overlook fees and exclusions, which can lead to unwelcome surprises when the final policy price is higher than the initial quote. Certain fees may be unique to specific insurers, including installment payment fees, credit card fees, broker fees, and costs for unnecessary riders such as accidental death coverage. While not everyone can pay for a full year of car insurance upfront, it’s essential to consider payment plans without fees when evaluating new insurers. Additionally, there is generally no need to pay broker fees, as fee-free options are available both online and in person, and coverage should not exceed what is necessary.
Exclusions in policies can result in denied claims under particular circumstances, with common exclusions including unnamed or unlicensed drivers, the use of a personal vehicle for business, custom vehicle parts, and travel outside the U.S. Ensuring coverage is adequate is crucial for those who have custom vehicles, frequently travel to Mexico or Canada, or use their car for a home business.
The initial quote received can serve as a benchmark for evaluating other offers. Stothard Deal, TransUnion’s vice president of strategic planning for insurance, notes that a significant difference between the current rate and a new quote suggests the potential for savings.
In comparing quotes, factors such as premium, coverage limits, deductibles, and discounts should be considered. Providing consistent driver and vehicle information to each company and ensuring coverage limits match across quotes is important.
To shop for car insurance effectively, using online calculators can provide an initial estimate. More detailed personal information entered on comparison websites can yield accurate quotes. Alternatively, direct quotes from insurers or consulting an independent insurance agent, who can gather multiple quotes, are also options. However, one should inquire about broker fees if using an agent.
Regularly obtaining new quotes is advisable, with an annual review recommended or when circumstances change, such as moving to a new location or buying a new vehicle.