How to buy auto insurance online

Are car insurance agents a dying breed? Today, auto insurance is one of those service businesses increasingly dominated by online providers.

In fact, one wonders if auto insurance agents are still needed. Do you really want to spend your Saturday morning visiting a car insurance office presenting the policy of only one car insurance company when you can buy car insurance online anytime – weekends, evenings, etc. . Not only that, but buying auto insurance online allows you to compare multiple companies’ offerings side by side in terms of policies and premiums. Additionally, you can purchase the policy online (in most states) and even file claims online.

It could well be pointed out, of course, that many people prefer to simply meet and talk face-to-face with an insurance agent, rather than just typing on a computer keyboard. On the one hand, they may feel safer transferring money (paying premiums) in person than over the Internet. On the other hand, they may prefer to have a knowledgeable person they can communicate with and ask questions.

But the number of such people relative to the adult population is clearly declining. According to market research firm ComScore, 67.5% of 2,000 US consumers surveyed last year said they would consider buying their next car insurance policy online. Buying auto insurance online has grown at an incredible rate of 55%+ over the past two years.

So whether you’re looking for a replacement policy or your first policy, online car insurance offers a number of benefits: savings, convenience, speed and better policy information available from a range of insurance providers. assurance.

However, before purchasing a policy, whether in person or online, make sure you know the basics of car insurance.

Online car insurance basics

If you drive a car in the United States, you need insurance. It is an obvious fact. But what insurance and at what price?

Liability insurance. As you may know, there are two main types of liability insurance, namely bodily injury and property damage. If you buy 25/30/25 coverage, that means the insurer pays up to $25,000 for bodily injury per person, $30,000 for bodily injury per accident, and $25,000 for property damage per accident. . This would therefore be a relatively small amount of coverage, and you should assess your own situation to decide which level of coverage is best for you. All states except New Hampshire and Wisconsin require you to carry liability insurance.

Collision. This category of car insurance covers your material damage and your medical expenses in the event of an accident for which you are responsible.

Complete. This type provides cover for losses resulting from accidents other than collision or theft, such as property damage resulting from flood, fire or vandalism.

Uninsured/underinsured motorist. Pays you if the other driver involved in an accident does not have insurance or does not have enough insurance. (Not required in all states.)

Protection against personal injury. Reimburses your unrecovered medical expenses as well as lost wages resulting from an accident. The PIP may also include a death benefit. (About 16 states now require PIP coverage.)

One source of confusion are the so-called “no-fault” car insurance programs. In a no-fault system, all drivers pay their own accident costs, regardless of who is to blame. For a long time, it was thought that this system would reduce litigation and therefore costs. This does not happen. In fact, it generally resulted in higher accident rates, higher costs, and higher insurance premiums. As a result, most states that had enacted no-fault laws repealed them (DC, NV, PA, NJ, GA, CT, CO, FL). leaving only Michigan, Kansas, Hawaii, Massachusetts, Minnesota, New York North Dakota and Utah. However, a few states – New Jersey and Pennsylvania – have adopted “no-fault choice”, allowing drivers to choose between a no-fault policy and a traditional policy. (Results, in terms of bounty levels, have been mixed so far.)

Reduce your premiums

For the average consumer, insurance companies may seem to have strange ideas about what factors to consider when setting your insurance rates. For example, I once found that my rates had gone up after another driver hit my car, and when I called the company and explained that the accident was not my fault, the customer service rep replied, “Yeah, but you were in the wrong place at the wrong time.”

That is to say, it’s all a numbers game and there is no real effort to achieve fairness in rate setting. So to win the game you need to provide the company with numbers that will result in reasonable bonuses. You have some control over some of them and some you don’t. Among the factors that will be taken into account are: age/gender (single men under 25 get higher rates; women generally get lower rates); location (New Jersey and California rates are high; city rates are higher than rural rates; many companies now even look at your ZIP code); driving history (if you have filed one or more claims in the past five years, this will significantly increase your premium; so will any speeding or other violation, even if no claim was filed) ; how much you drive; type of car (expensive cars get higher premiums, as do cars with high theft rates, like the Toyota Camry and Honda Accord, as well as off-road vehicles and large SUVs).

Find an auto insurance company online

If you run a search on Google, MSN or Yahoo for “car insurance” or “auto insurance” you will see that this is a crowded company on the internet. There are literally hundreds of companies that advertise car insurance online. However, your best bet is to use one of the companies that allow you to order online, such as Esurance.com or InsureMe.com.

You’ll soon notice that each online insurance company has its own little qualification process and a series of screens that they require you to pass before giving you a quote.

Esurance.com is a good example. It starts by asking you for your postal code – a fairly simple question. Then on the next screens they ask for detailed information – How many cars are you insuring. How many drivers. Year/Make/Model of your car. Uses of your car. Discounts you may be eligible for such as air bags, anti-lock brakes, car alarm, etc. The coverage you are looking for. And so on.

The Esurance.com application process is actually quite simple and only takes a few minutes – after which you receive a specific quote from Esurance.com, which is a virtual (online) insurance provider.

In contrast, another website, InsureMe.com, walks you through a very similar application process, but ends up without providing you with a specific quote. Instead, it lists several physical insurance companies that will contact you later, by email or phone, with specific quotes. This has the advantage that you will be able to compare policies and quotes, and the disadvantage that you will have to wait a while for companies to contact you.

Other car insurance aggregators (as they are called) have other processes – some, for example, run your credit report as part of the process.

In any case, as a final step in choosing a policy, you may want to take some time to check out your selected insurance provider on AMBest.com, especially if it is a supplier you do not know. To do this, you’ll need to create an account on AMBest.com to view a car insurance company’s rating, but it’s pretty simple to do. Once you have created your account, click on “review and analysis” and enter your company name. Companies are assigned a letter grade from “A++” down. You will definitely want your selected business to have at least a “B” rating, which means “good”.

Incidentally, even if you already have what you think is a reasonably priced policy, it’s usually still a good idea to apply online to see if you can get a better premium rate. After all, there is no obligation and it only takes a few minutes. According to a recent consumer survey by industry publication EDP Weekly, one in three people who bought auto insurance online and then purchased a new policy saved more than $500, with some saving $1,100 or more. .

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