How to Shop for Car Insurance: A Step-by-Step Guide

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Updated July 6, 2022

How to shop for car insurance: family riding a car

Shopping for car insurance for a new or used car can be tricky: Every driver needs car insurance, but the best insurance policy will be different for every driver. There are at least 11 factors that can affect your car insurance rates, and each state has its own requirements for minimum car insurance coverage.

That means the best way to shop for car insurance is to compare quotes from multiple car insurance companies to ensure you get the best deal.


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Let’s look at how to shop for car insurance step by step, including what vehicle information you’ll need to have handy and what types of coverage are available.

How to Shop for Car Insurance in 4 Simple Steps

If you’re wondering how to shop for car insurance, you have several alternatives, including going through an insurance agent or calling up your existing insurance provider.

But since different companies offer different rates and discounts, it’s a good idea to explore your options before choosing the best car insurance policy for you.

Here’s how to shop for car insurance in four simple steps:

1. Collect Your Personal and Vehicle Information

Auto insurance rates are determined by factors such as age, location, and the type of car you drive. So you’ll need to have all of the following information handy:

  • Name and date of birth: You might know your birth date by heart, but keep in mind that you’ll also need this information for anyone else who’ll be on the policy with you — such as your spouse, teenage children, or roommates.
  • Address: Car insurance rates can vary widely from state to state, so you’ll get a different rate if you live in New York vs. California. Comparison tools may only ask for your ZIP code initially, but you’ll need the full address later.
  • Driver’s license number: You’ll need to provide your driver’s license number (and that of anyone else who will be on the policy) so the insurer can look up your driving history. If you have moving violations like a speeding ticket on your driving record, this can impact your insurance.
  • Vehicle identification number: Next, your insurance company needs to know the make and model of your vehicle (or vehicles, if you plan to insure more than one). The easiest way to provide this information is to look up the VIN, or vehicle identification number, on the title or registration. You may also need an odometer reading and other vehicle information.
  • Current or previous insurance policy: Car insurance companies want to know if you’ve maintained consistent coverage and your coverage limits, so dig out your previous policy documents if you have any. 

2. Understand Coverage Options and Coverage Limits

Stressed woman using her phone

Now that you have your personal information handy, you’ll want to consider what type of coverage you need. There’s nothing wrong with buying cheap car insurance to keep your monthly premiums low. But if you have a fancy new car, you may want to purchase more robust coverage to protect your investment.

The types of coverage you can purchase include:

  • Liability insurance: Liability coverage protects your assets if you get into an accident and have to pay for damages. In some states, this is the only type of coverage you’ll need to meet the state’s minimum requirements. Liability insurance may be listed separately as bodily injury liability and property damage liability.
  • Collision insurance: Collision coverage pays for the cost of repairs to your own vehicle in most types of accidents, no matter who’s at fault.
  • Comprehensive insurance: Comprehensive coverage extends collision protection to other types of incidents, such as theft, vandalism, or natural disaster.
  • Personal injury protection: Personal injury protection covers medical payments and lost wages in the event of an accident.
  • Underinsured/uninsured motorist coverage: Uninsured motorist coverage pays for medical expenses and other damages when the at-fault driver doesn’t have sufficient coverage (or any coverage) of their own.
  • Full coverage: “Full coverage car insurance can mean a few different things, but it will typically include all or many of the above coverages, so it may be more cost-effective than buying each type of coverage individually.
  • Roadside assistance: Roadside assistance may come with some types of coverage, but it may also be available as a standalone plan.

New drivers, teen drivers, and high-risk drivers may benefit from having higher liability limits instead of choosing the cheapest car insurance coverage.

And if you’re leasing or financing a car, your lender may require more extensive coverage than you would choose on your own.

3. Choose a Deductible Amount

Coverage options aren’t the only thing to consider. To get an accurate auto insurance quote, you’ll need to choose a deductible. This is the dollar amount that you’ll pay out of pocket before your car insurance policy kicks in. A typical deductible is $500 or $1,000 but can be as low as zero on some auto insurance policies. 

A higher deductible means lower insurance premiums — but you’ll have to pay more out of pocket if you get into an accident. For some drivers, it might be worth paying a little more each month to get a lower deductible.

4. Compare Car Insurance Quotes From Multiple Providers

Understanding your coverage options is important, but you don’t have to choose your coverage amounts just yet. Now, it’s time to get quotes from multiple auto insurance companies so you can find the best rates and keep your insurance costs low.

You can do this in one of three ways:

  • Contact an insurance agent: Some insurance agents work for one company, while others are independent agents who can help you choose between multiple insurers. Agents can explain your insurance requirements and minimum coverage laws in your state — but they may charge broker fees or upsell you on additional products.
  • Get a quote from each insurer separately: Most insurers allow you to request a quote directly from their website. If you have renters or homeowners insurance with a particular company, check their rates first to see if they offer car insurance discounts for existing customers. But if you plan to compare rates from multiple providers, this approach can be less efficient.
  • Use an online comparison tool: The best way to shop for car insurance is to use a comparison tool like the one at Compare.com. All you have to do is enter your ZIP code and car information, and you’ll get automatic quotes from multiple car insurance companies side by side. This makes it easy to find lower rates for a similar amount of coverage without requesting quotes separately.

Before buying car insurance, you may also want to read reviews to see how well each company scores on customer satisfaction.

The Best Way to Shop for Car Insurance

Man driving a car

The best way to shop for car insurance is to research coverage options and compare quotes from multiple providers. You’ll need your vehicle information handy and be ready to choose coverage limits and a deductible amount. By using a comparison tool like the one at Compare.com, you’ll be able to see quotes all in one place.

Other ways to lower the cost of car insurance include taking a defensive driving course and improving your credit score. If you have a clean driving record, you may also benefit from car insurance discounts like a good driving discount.

Should you shop for auto insurance coverage before or after you buy a new car? It’s never too early to compare rates and explore your options. Simply enter your ZIP code here to get started:


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