What Is an Auto Insurance Quote?

An auto insurance quote is an estimate of the amount you will pay for a car insurance premium. It also itemizes the costs and limits of individual coverages. A thorough quote may also apply discounts for which you qualify and offer bill payment plans. 

Requesting quotes is an essential part of shopping for auto insurance. To make an informed decision, always request quotes from several insurers before buying a policy.

Key Takeaways

  • A car insurance quote estimates how much your premium will be.
  • You can get quotes from a broker, an agent, or a company website.
  • You’ll need to supply information about yourself and your car, and the insurance company will check your driving record.
  • Quotes take into account risk factors reflected in your claims history, annual mileage driven, driving experience, coverages, and driving record, among other things.
  • Getting quotes from multiple insurance carriers allows you to compare prices and coverages that each insurer can provide.

Factors That Affect Car Insurance Quotes

While a car insurance quote might not give you an exact figure for how much you will pay for coverage, it can provide a ballpark estimate of the premium that a provider offers. Traditionally, insurance companies determine premiums based on rates and underwriting, the process by which a provider assesses an applicant’s risk and the likelihood that they’ll file claims.

For instance, a driver who has moving violations and traffic accidents on their driving record is seen to pose a higher risk than one who has a clean driving record, and will usually have a higher premium. Premiums can fluctuate throughout the life of a policy, based on changes in the level of risk. Common rating factors include an applicant’s:

  • Age
  • Annual mileage
  • Claims history
  • Coverages
  • Credit history
  • Deductibles
  • Driving experience
  • Driving record
  • Gender
  • Location
  • Marital status
  • Previous car insurance coverage
  • Vehicle make and model
  • Vehicle use (personal or commercial)

Sometimes, you can reduce your premium by decreasing the risk you pose to the insurer. For example, if you rent an apartment in a location with high auto theft rates, you might receive a lower premium by moving to a safer neighborhood. Your location may also pose a higher risk if you live in an area prone to severe weather, like floods, hailstorms, hurricanes, and tornadoes.

You might also lower your rate by increasing your deductible—the portion of a claim you must pay out of pocket—or by dropping optional coverages you don’t need.

An increasing number of insurers now offer usage-based insurance (UBI) programs, which set premiums based on a motorist’s driving habits. For example, for drivers who maintain safe driving habits, avoiding late-night trips, hard stops, and speeding, a UBI program may offer a lower premium than a conventionally rated insurance policy.

Where to Get an Auto Insurance Quote 

When seeking car insurance quotes, approach the task with a comprehensive strategy. You can get quotes in several ways:

  • Over the phone or in person from an insurance agent
  • Via the internet from national and regional carriers
  • Over the phone or online from independent insurance agents or brokers

When requesting quotes, always follow a few ground rules to make sure you get the best possible estimates and avoid pitfalls:

  • Always request quotes from several car insurance companies to determine which provider best meets your budget and needs.
  • Always make sure the insurance company has a license to sell auto insurance policies in your state. Many state departments of insurance offer online resources that enable you to access the status of an insurer’s license.
  • When requesting quotes, truthfully answer all questions about your driving history and record, the type of vehicle you own, and how often and for what purposes you use it. 
  • Requesting insurance quotes requires you to submit personal information. For phone quotes, make sure you are speaking with a licensed insurance agent. When requesting quotes online, make sure the website has a secure, encrypted connection.
  • Inquire about discounts for which you might qualify.
  • Once you get your quotes, compare coverages, discounts, and rates.

Before buying a new car, always get auto insurance quotes for the make and model you want to purchase. Some vehicles cost more than others to insure, often because of their theft rate. For instance, in 2021, many of the most commonly owned vehicles on the market ranked among the most popular with car thieves.

Information You Need to Get an Auto Insurance Quote

The quote process varies by insurer, but many companies require you to submit personal information, such as your:

  • Name
  • Address
  • Contact information
  • Date of birth
  • Record of accidents and tickets
  • Driver’s license number
  • Gender
  • Marital status

You’ll also need to provide personal information for anyone else who regularly drives your car, which may include their Social Security numbers.  An insurer might also require you to provide the names and birthdates of others in your household, even if they don’t drive your automobile.

In addition to personal information, you’ll need to provide detailed information about the car you want to insure, including its:

  • Make and model
  • Manufacturing year
  • Body type
  • Coverage history
  • Finance or lease information
  • Parking location (carport, secure garage, street, etc.)
  • Purchase date
  • Registered owner
  • Weekly mileage
  • Vehicle identification number (VIN)

If you already have auto insurance but are shopping for a new carrier, you might need to provide information about your current policy, like its coverages, limits, and deductibles. You can find information about your coverage on your policy’s declarations page.

Auto Insurance Coverage Types

Deciding how much coverage you need will depend on your state’s legal requirements and your personal needs and obligations.

Liability Coverages

Most states require you to carry minimum levels of auto insurance coverage, which may include:

Bodily injury liability: When you’re deemed at fault for an accident, this type of coverage helps pay the medical costs of the driver and passengers of the other vehicle. However, bodily injury liability coverage doesn’t pay the medical expenses of you or your passengers.

Property damage liability: If you cause an accident that damages someone else’s property, such as a car, building, or fence, property damage liability coverage helps pay to repair or replace it. This type of coverage doesn’t pay to repair or replace your automobile.

Both types of liability coverage protect the policyholder and all listed drivers. In some states, a policy might also cover injuries and damage caused by a non-listed driver who drives your automobile with your permission.

Some states require low limits of bodily injury and property damage coverage, which may not provide enough financial protection. For instance, California requires motorists to carry just $15,000 in bodily injury liability auto insurance for injuries to one person, which likely wouldn’t cover the costs of serious injuries. Always purchase enough liability coverage to protect all your assets from potentially being seized for payment. If you are unsure how much coverage you need, ask your insurance agent for advice.

Medical Payments and Personal Injury Protection Coverages

Some states require motorists to purchase coverages that help pay the medical expenses of themselves and their passengers following a covered accident.

Medical payments: This type of coverage helps pay the medical costs of you and your passengers.

Personal injury protection (PIP): Also called no-fault insurance, PIP helps cover the medical costs of you and your passengers and may cover funeral costs or lost wages.

Excess medical payments: If you carry PIP, excess medical payments coverage helps pay costs that exceed your PIP limit.

Uninsured and Underinsured Motorist Coverages

If you’re involved in an accident with a driver who has insufficient car insurance, or no coverage, these types of coverage can help pay your expenses. Realizing the need to protect car owners, many states require drivers to carry certain uninsured and underinsured motorist coverages.

Uninsured motorist bodily injury: This coverage can help pay the medical expenses of you and your passengers if you’re involved in an accident with an uninsured driver. It also extends coverage if a hit-and-run driver collides with your vehicle.

Uninsured motorist property damage: If an uninsured motorist collides with your car, this coverage can help pay to repair or replace it.

Underinsured motorist: When a driver who has insufficient coverage causes an accident with your automobile, this coverage can help pay the medical costs of you and your passengers.

Required coverages and coverage limits vary by state. Although your state might not require a certain type of protection, your insurer might offer it as an optional coverage.

Collision and Comprehensive Coverages

State laws don’t require you to buy coverages that protect your vehicle. But if you finance or lease your car, the leasing company or lender likely will require you to carry collision and comprehensive coverages through the life of the loan.

Collision: Following a covered accident, collision coverage can help pay to repair your automobile. If the insurance company declares your vehicle a total loss, collision coverage usually pays its depreciated value, referred to as actual cash value.

Comprehensive: This type of coverage helps pay for losses caused by perils other than a collision. For example, comprehensive coverage could help pay to replace a stolen vehicle or repair one damaged in a flood.

Collision and comprehensive coverages typically have separate deductibles.

Optional Coverages

Many insurers offer optional coverages that help you avoid costly out-of-pocket expenses.

Gap insurance: If you buy a new automobile and total it while you’re still paying a car loan, gap insurance can help pay the difference between the insurance settlement amount and the amount you still owe the lender.

Rental car reimbursement: Following a covered accident, this coverage can help pay the cost of a rental car while yours is in the repair shop.

Roadside assistance: Some carriers offer optional roadside assistance coverage, which helps you get back on the road after a breakdown. Basic coverage often includes extrication, fuel delivery, lockout, tire change, and towing services.

Why do you need an auto insurance quote?

Getting car insurance quotes is a vital step in buying a new policy. While finding the cheapest premium is important, insurance quotes also can help you compare providers’ coverages, discounts, and optional coverages.

What is the average car insurance rate?

Personal rating factors, such as your age, claims history, and location, determine the cost of your auto insurance premium. According to a 2022 AAA report, motorists under age 65 who have a clean driving record pay an average of $1,588 annually for full-coverage car insurance. However, rates can vary widely among insurers. For instance, some Denver auto insurance companies charge around $898 for a minimum coverage policy, while others charge as much as $8,223.

What is the difference between quote and rate?

Insurance rates are like the building blocks that providers use to determine the cost of a premium. On one hand, certain risks can put you in a higher rate category, while applicable discounts can lower your rate. On the other hand, an insurance quote is an initial estimate of how much you will pay for insurance, based on a limited amount of personal data. The underwriting process helps insurers pinpoint the risk that an applicant poses and arrive at a premium price.

Does getting a car insurance quote affect your credit?

No. Insurance companies employ a “soft pull” credit inquiry, which will appear on your credit report but won’t affect your credit rating. However, hard inquiries, conducted by lenders, can affect your credit score if you frequently apply for credit.

Can you get an auto insurance quote without owning a car?

Yes. In fact, requesting quotes for an automobile before you buy it makes good financial sense. Insurance is a primary expense in car ownership. Certain makes and models of vehicles have safety issues or high theft rates, which can increase the cost of insurability.

The Bottom Line

Car insurance quotes are an important tool in deciding which insurance company can offer the best and most affordable protection for your automobile. Comprehensive quotes go beyond price and enable you to compare coverages, discounts, and optional protections.

Whether you’re buying a new car or shopping around for a lower premium for a vehicle you already own, always request quotes from several providers before buying a new policy.

Article Sources
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