Go for Good, Not Cheap, Auto Insurance

Here's the thing about those marvelously low auto insurance quotes you hear on TV: What exactly are you getting for the price?

When buying auto insurance, the buyer must always be aware that the cheapest car insurance available may have gaping holes in its coverage. The good news is that it's possible to purchase inexpensive car insurance and get adequate coverage.

Here are the two keys to choosing among auto insurance vendors that quote you low prices:

* How reliable is the insurance company when it comes to fulfilling the terms of the policy?

* What kind of coverage are you getting for that low, low quote?

Low prices are easy to spot, but it takes a good look at the details of the policy to determine actual value. The reliability question is even more difficult to assess. "Reliability" refers to how the insurance company treats its customers, especially when the customer files a claim. Does the insurer pay claims promptly and in full according to the policy terms?

Here are some suggestions for choosing reliable insurance companies:

1. Check out the insurance company's "customer complaint ratios" on your state's Department of Insurance web site. This will tell you how many complaints an insurer received per 1,000 claims. If your state doesn't publish this information, try other states' listings. No matter how low the quote, a bad customer complaint ratio should make you think twice about signing with that insurer. Be sure to write down the companies that have favorable ratings, even if their quotes may be higher.

2. Check out the basic rate comparisons listed on the department of insurance websites. These surveys can give a "ballpark estimate" of those insurers whose rates you find attractive. Otherwise, you'll have to spend a lot of time typing in your personal information on an insurance quote website.

3. Talk to the manager of your local body shop. Body shop managers and customer service representatives deal with insurance companies every day. They know which ones pay claims with least hassle and biggest checks. This research may take a little time, but it could be worth it to your bank account.

4. Also ask body shops which insurers require "aftermarket" parts rather than original equipment manufacturer (OEM) parts. You want your car back in the best possible condition, and sometimes aftermarket parts fit poorly and look worse. If you live in Minnesota, rejoice; that state prohibits auto insurers from requiring aftermarket parts for repair.

5. While buying insurance directly seems like a good idea, it can be to your advantage to work with an independent insurance agent. An independent agent works with many auto insurance companies, while a "captive agent" works only with one company. An independent agent, also known as an insurance broker, can search out the best insurer for your needs, depending on your state's minimum requirements, your driving record, the number and type of additional drivers (such as teenagers) and your financial situation. What's more, should you have a claim, your independent agent has a greater business interest in making sure that you're well served. The agent wants to keep you as a client, so he or she will make sure that the insurer fulfills every jot and tittle of your auto insurance policy.

< Return Home