Five Reasons You Might Want to Pay More for Your Car Insurance

September 30, 2016

how much insurance do i need

We’re all about helping people save money on car insurance. You compare auto insurance quotes, you pick the lowest rate, you save. That’s how it works. Right?

Well, sometimes it’s actually smarter to pay more for your car insurance. You may want more liability protection, or maybe you want better claims service. Here are five scenarios when it makes sense to pay a little extra.

Why pay more? Because you can get a lot more car insurance coverage for a small premium bump.

I had the same level of liability insurance for 10 years: $100,000/$300,000 per person/accident in bodily injury coverage, and $100,000 in property damage liability. That sounded like a lot — plenty of coverage for most accidents. Or was it?

I called my insurer and asked how much more it would cost to raise the amounts. I found out that I could more than double the amount of bodily injury coverage — to $250,000/$500,000 — for a monthly premium increase of $4.88. To me, the additional peace of mind is well worth paying less than $5 more each month for car insurance. You may not need the same amount, but if your current insurance is at state minimum levels, you should think about raising the limits to protect yourself.

Why pay more? Because you really like your car insurance company.

Think you’re getting a loyalty discount by sticking with your insurer for five years or more? Nope — the company’s probably charging you extra, because it knows you’re less likely to leave. This practice is called price optimization. Insurers collect data about your spending habits, and if they can see you’re not a super price-conscious shopper, they’ll take the opportunity to raise your car insurance premiums when you’re not looking.

If you want to keep your longstanding relationship with your insurer, but you don’t want to pay more for the privilege, here’s one solution. Compare auto insurance quotes on Compare.com, then take the numbers to your car insurance company. Tell your insurer you’re considering a switch, and ask for a reduction in your premiums.

Why pay more? Because you really don’t like your insurance company.

You were happy with your super-cheap car insurance — until you got into a fender-bender. It should have been an easy claim to handle, but your insurance company stalled, tried to charge you extra, and generally made your life unpleasant.

It’s time to compare auto insurance and upgrade to a better company, even if that means paying a little more. Read this guide to finding the best cheap insurance, then compare quotes and coverages to find the right option for you.

Why pay more? Because you’re worth it.

Yes, that sounds like a cheesy makeup ad. But if you’ve wondered, “How much car insurance do I need?”, your net worth is the answer. When you were a college student with about $5,000 worth of possessions, you didn’t worry too much about getting into a car accident and being sued for everything you owned. Now, however, you may own a house and have some money set aside — and that means you should protect your assets by paying more for liability insurance.

Why pay more? Because it makes sense to lower your deductible.

Most financial gurus will tell you to choose a higher deductible in order to save money on your car insurance premiums. But that’s not always a good deal. If you save $50 per year on premiums by raising your deductible from $250 to $750, you’ll have to stay accident-free for 10 years to come out ahead. So it may be smarter for you to pay more in car insurance premiums in exchange for a low deductible. Do the math: You can adjust your deductible amounts using Compare’s free auto insurance quote tool to see how they affect premiums.

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You could save up to 32% by using Compare.com!

Based on a survey of 100 California Residents. Average savings determined via a comparison of their selected policy against their self-reported annual premium.