Shopping for car insurance online is convenient and time-saving compared to traditional methods. However, having agents to consult with at physical locations can make the purchasing experience smoother, especially if you’re not comfortable with your level of auto insurance knowledge.
Regardless of what method you use to obtain coverage, the most effective way of finding the best car insurance rates is to compare quotes from multiple companies.
How to buy car insurance online
1. Determine the amount of coverage appropriate for your individual needs
When searching for auto insurance online, you should start by evaluating your own driver profile. The amount of coverage that will best suit you depends on multiple factors, including the value of your car, how much you can afford to spend in out of pocket expenses and what you want from your coverage.
First-time drivers or drivers looking for the cheapest car insurance option. You'll want to know your state’s minimum insurance requirement, the lowest amount of coverage needed to legally drive. While the minimum coverage policy is the most inexpensive option, it may not be the best for your needs. You want to strike a balance between having affordable costs and sufficient coverage.
Drivers switching from an existing policy. We suggest you get to know what kind of features from your existing car insurance policy you'd like to carry over to your new insurer, your coverage limits, and what you’re covered for.
A good place to find a summary of your existing auto insurance is the declaration page that comes with your policy. It's also available upon request from your insurer. The declaration page lists key information about your insurance policy including the policy term, limits for each type of coverage, coverage limits, and costs. If you’re happy with your current coverage, you can use your declarations page as a reference when searching for auto insurance quotes online to ensure you're getting the coverage you want.
2. Collect the necessary information to receive a policy quote
After you're familiar with your existing policy or what kind of policy you would like, you can start searching for quotes online. The process is simple as most insurers have online forms that you can fill out to obtain a quote. Here are the most common pieces of information you'll need to have in order to receive a quote:
- Date you want your coverage to begin
- Driver’s license
- Current mileage on your car
- Details of any previous violations or accidents.
- Personal information for any driver you want listed other than yourself.
- Social security number (for some insurers).
- Vehicle identification number (VIN) for the cars you wish to insure.
- Each vehicle’s anti-theft features
- Each vehicle’s year, make and model
- Previous insurer (if you were insured previously)
- Expiration date for existing coverage (if you were insured previously)
3. Evaluate each insurer's discount and service
In order to receive the cheapest car insurance quote for your driving profile, you should ideally compare quotes from at least three insurance companies. While cost is important to factor in when shopping for auto insurance, you should also compare coverage options and quality of customer service.
Most insurers, particularly large ones, offer a plethora of discounts for being accident free, completing a defensive driving course or installing anti-theft devices. These discounts can stack up and make your policy substantially cheaper.
To evaluate the service quality of your insurer, there are a few resources you can employ. You can start by checking The National Association of Insurance Commissioners, which collects and publicizes complaint data from state insurance regulators onto their website. When researching a company you are unfamiliar with, it’s essential to receive as much information as possible. To develop a comprehensive view, you can also read insurer reviews of each company.
Make sure you review and carefully read over your car insurance policy before finalizing your decision because it is a legal contract.
Should I purchase insurance online or use an agent?
You should purchase your insurance policy through whatever medium better aligns with your specific needs, whether that's online or in-person with an agent. When purchasing auto insurance at a physical location, you'll choose between a captive agent and an independent agent. The main distinction between the two is that captive agents only represent one insurance company while an independent agent offers rates from multiple companies. Below we list the benefits and drawbacks of different ways to purchase auto insurance:
Purchasing car insurance online
- Cheap and convenient
- Less guidance when choosing a car insurance company
- What you can view and purchase online will vary by company
Purchasing insurance online is cheap and convenient, since you can save time and money by comparing quotes from multiple insurers at home.
The only downside is that you receive less guidance when choosing a car insurance policy, which could result in fewer discounts and less assistance if you have complex coverage needs. While you're able to connect to agents by phone, you won’t always be speaking with the same person. You should have a solid understanding of what you want covered under your auto insurance policy. As mentioned previously, this is generally attained by getting a copy of your existing coverage. To make sure you're receiving the best price, you should gather multiple quotes from insurance companies online for the same coverage types and limits.
Car insurance companies, particularly those that let you purchase coverage online, have started offering features on their websites. Many insurance companies also offer the ability to file a claim, enroll in automatic billing, receive monthly statements, and update policy information online. Features vary by company, so ask your potential car insurer about any online features that are important to you.
Purchasing car insurance in-person with a captive agent
- Captive agents have comprehensive knowledge
- Only offer products from one insurer
Captive agents can offer in-depth product knowledge since they can only offer products from one insurance company. These agents also have the added benefit of providing in-person support.
The downside when using a captive agent is that they're only able to offer products from one insurer. If you're unfamiliar with auto insurance and are looking to be covered by a specific insurer then this may be a good option for you. However, you won’t know if you’re getting competitive rates for your auto insurance.
To make sure you’re getting the best price, gather multiple quotes from different captive and independent agents.
Purchasing car insurance in-person with an independent agent
- Can offer rates from multiple companies for auto insurance
- Could upsell you since they mostly rely on commissions
- May not have relationships with insurance companies that employ captive agents or work directly with consumers
Independent agents, also known as insurance brokers, have the benefit of being able to offer rates from multiple companies for auto insurance. Typically, these agents also operate out of physical locations which means you can get personalized support.
The drawback is that they could upsell you since they mostly rely on commissions, while captive agents usually receive a salary on top of commission. Another drawback is that the insurance broker won’t have relationships with insurance companies that employ captive agents or work directly with consumers.
Therefore, you'd also have to contact captive agents in your area, and potentially go online, in order to compare prices of insurers that the independent agents don’t have access to. Purchasing your insurance through an independent agent is a good option if you want the ability to compare multiple quotes with minimal effort, while still getting in-person guidance.
Below is a list of the five biggest insurers along with how you can obtain an auto insurance quote. Click on a company name to read our full review.
How to save money when buying car insurance online
Aside from comparing quotes across multiple companies, there are other methods drivers can utilize to ensure they receive the cheapest coverage. Drivers switching companies for cost reasons should reach out to their current insurer to ask for discounts. If your insurance company wants to retain you as a customer, the agents will be willing to work with you. However, this isn’t a guarantee.
Aside from negotiating, here are a few alternative ways to reduce insurance costs:
- Pay a higher deductible to reduce your premium cost.
- Pay upfront for your car insurance coverage rather than on a monthly basis.
- Ask for an updated quote when your driving record improves.
- Evaluate your current coverage needs and adjust your policy to match your new profile.
- Shop for car insurance ahead of your policy’s expiration date as some insurers view it as a sign of responsibility.
- If you’re a young driver, consider signing onto a combined auto insurance policy with your parents.
Can I cancel my auto insurance policy online?
Most insurance companies will not allow you to cancel a policy through their website, even if you purchased a policy online. Instead, you will have to cancel by speaking with an agent, sending a letter or stopping by one of their locations in person.
Insurers will typically allow you to cancel a policy at any point but some companies may penalize you or charge a cancellation fee if you cancel before the term’s expiration date. Every insurer has a different cancellation policy so it’s important that you contact your insurance company to discuss their specific terms.
If you decide to cancel your policy before the end of your policy term but have already paid the entire cost of the policy upfront, contact your insurer to see if you qualify for a partial refund.
When you finalize your policy cancellation, make sure you receive a written confirmation or receipt from your insurer. If you somehow receive charges from your insurer after you’ve cancelled your policy, having proof of the cancellation will prevent you from being unfairly charged. In the event that you do get charged for a policy but aren’t making payments, the company can report it and damage your credit rating.
When you switch policies, make sure that your new policy begins the same day your old coverage ends so that you are continuously insured and legally driving. If you are caught driving without valid insurance, you can face fines, license suspension, and even jail time.