What Do I Look for in Auto Insurance?

Auto insurance, like taxes, is a necessary evil in this country.  No one likes to pay for auto insurance, but we all have to have it.  I have yet to hear someone gleefully exclaim that they're shopping for new auto insurance.  That would be a little frightening, actually.  That said, auto insurance is a must.  Most states require at least liability insurance on all driven cars and if you have a car that's not paid off, most of the time you'll have to have full coverage insurance to pay off the car if it's totaled in a wreck.  Auto insurance isn't a bad thing, of itself, but many people are suckered into paying more than what they need to.  There are a lot of factors that play into the price of you auto insurance premium, and knowing what they are and how to change them will help you get a better price on your auto insurance.

The factors that determine your policy price are: your driving record (speeding is bad, remember?), the area you live in, the distance you regularly drive your car, whether the vehicle is a primary or secondary vehicle, and how far your work place is from your home, if the vehicle is a primary vehicle.  The type of car also plays into the cost of your policy; a sedan will be lower than a new sports car.  Another factor is the age of the vehicle; new cars cost more to insure than older vehicles.

Every insurance company in the country uses all of these factors, so why do different insurance company's rates vary so greatly?  It all has to do with the auto insurance company.  National auto insurance brokers often inflate their rates so that they can give customers a "rebate" or incentive to place their vehicle with that company for insurance.  At best, this is mildly deceptive; at worst, it can almost seem like fraud.  Other factors that make insurance rates vary are the company's cost of doing business and their previous claim experience.  Insurance companies set their rates, at least partially, by predicting future accidents.  Since the companies are not psychic, they have to use previous experiences.  Each company's claims experience will be different.

Jill Cloda, of Boston, Massachusetts, found herself in need of auto insurance.  Rather than going to a national insurance provider, Jill decided to check out her local insurance agencies.  She did a smart thing; Jill got a better insurance policy at a better rate than if she'd gone with a big national agency.

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