Why is there a difference in rates for car insurance?

First of all, each state has its own laws about the minimum coverage a person must carry to legally drive. Also, people have different insurance policies depending on how much their vehicle is worth to them.

Suppose a vehicle is only worth $2,000. In that case, most people will not have full coverage insurance and will opt for the minimum required by law. That means your vehicle won’t be covered by comprehensive or collision coverage, but the vehicle isn’t worth much anyway.

How much does full coverage insurance cost for a 20-year-old? On average, someone that young will pay $5,333 for their annual premium. The amount you pay will vary based on your age.

Your past driving record is the most important factor in determining your premium cost.

If you’ve recently received tickets or been in an accident, try talking to your local police first to reduce the number of points you have. If you are successful, your premium will be reduced.

Finally, costs vary greatly depending on where you live. If you live near a big city that has a high crime rate and heavy traffic, you’ll pay a higher premium.

If you live in a small farming town without any problems, you will enjoy lower average insurance rates.

How do you start looking for coverage?

Before you even start looking for insurance providers online, you need to determine what type of coverage you need.

Do you want to cover your vehicle if it is totaled or needs some serious work? Do you only want to cover the liability portion if you were involved in an accident?

Suppose you are currently financing or leasing your vehicle. In that case, you will likely need to purchase comprehensive and collision insurance to take care of your vehicle, as most lenders will require it.

Once you’ve determined the type of insurance you want, go online and start looking at all the insurance companies you can find.

There are many companies available, so it can be helpful to find a site that compares multiple insurers.

This will save you a lot of time in the process because you won’t have to fill out your information on 10 different sites just to get quotes.

How do you select your coverage?

Once you’ve found a site to get quotes, you need to select the type of coverage you’d like to have on your policy.

Many companies will try to help you by having many packages already pre-selected for you, ranging from minimal coverage to more comprehensive coverage.

The following features can greatly change the average price of car insurance. Here are some things to look for in a policy:

  • Deductibles  – If you don’t mind paying later, you can save a lot of money in the short term; the higher the deductible, the lower your insurance rates.
  • The maximum amount of coverage  – When you buy liability, comprehensive, or collision coverage, you’ll need to specify how much you want that policy to cover. Responsibility to drive is required, but the other two are optional.
  • Medical Benefits  – This is a solid option for your policy because you get a certain amount of money for medical bills, no matter who was at fault for the accident. It covers a variety of medical and hospital bills and adds very little to your monthly premium.
  • Uninsured or Underinsured Coverage  – You may be a great driver, but not everyone on the road is like you. That means you can get into an accident with someone who doesn’t have insurance or doesn’t have enough coverage; this coverage protects you against this.
  • Vehicle rental and roadside assistance  – If you need extensive work on your vehicle, this may be a good option. They give you a rental car when they work on your car.

While these pre-selected packages are a great starting point, you should take a look at what these packages offer to be a smart consumer.

How do you buy your policy?

Now that you’ve gone through this rigorous policy screening process, you’ll need to purchase your policy. This isn’t as easy as it sounds, as you now need to complete a fair amount of paperwork to activate your policy.

Again, this is where you can change the average cost of a policy.

When you purchase your insurance coverage, you have the option to pay your premium monthly, bi-monthly, every six months, or all year long in some cases.

Some companies offer auto insurance discounts if you choose your preferred payment method.

You’ll enter your vehicle information, your vehicle’s safety protection, and any driver courses you’ve recently completed. This may change your premium amount, so be sure to provide accurate information.

How can you find your best rates?

Comparing prices offered by different companies is your best bet for finding cheap auto insurance rates. Fortunately, this is very easy to do these days.

You can find online quoting systems that will tell you how much your coverage will cost from the comfort of your computer or even your smartphone.

Some of these systems are offered by individual insurers. Others may offer multiple quotes because they are independent and do not belong to any particular company.

Freelance sites are quite useful because they can offer a handful of comparative quotes from various companies.

Alternatively, you can call a local insurance agent. These trained professionals should be able to offer you free price quotes. They can also give you advice on the type and amount of coverage you should purchase.

Is it worth comparing car insurance prices?

Some people never bother to compare car insurance prices because they think all companies are too similar.

The truth is that some companies offer better prices for certain types of customers than for others. This may be true if you have a clean driving record or have had a few accidents.

For example, did you even know that insurers may consider your credit report when determining how risky it is to cover you? Some of the nation’s top insurers offer discounts for things like driving a green car.

It may seem like a credit report should have nothing to do with driving, but insurers say people with good credit tend to make fewer claims. They also argue that people who buy “green” cars tend to have fewer accidents.

Enter your ZIP code in the free tool below to start comparing average monthly car insurance costs in your area.

What else should you know about car insurance costs?

Want to learn more about the average monthly cost of car insurance? We have answered frequently asked questions in the final section of this review.

#1 – How much does car insurance cost per month for an 18-year-old?

The average monthly cost of car insurance for an 18-year-old driver is $175 per month.

#2 – What car insurance is the cheapest for full coverage?

USAA auto insurance may be the cheapest insurance company for comprehensive coverage, but this company is only available to members of the military. If this doesn’t apply to you, check out GEICO or State Farm.

#3 – How much does car insurance cost for a 16-year-old?

The average cost of auto insurance for a 16-year-old driver is $6,930 per year ($578 per month) for full coverage and $2,593 per year ($216 per month) for minimum coverage.

#4 – Who really has the cheapest car insurance?

USAA, GEICO, State Farm, and Progressive are known to have some of the cheapest rates in the country.

#5 – How much is the AAA insurance quote for a supercar?

Supercar insurance with AAA auto insurance company or any other insurer could cost between $760 and $1,700 per month.

#6 – How much does full monthly coverage insurance cost?

Total coverage could be as low as $86 per month. However, your rates could be much higher, depending on your location and the company you’re with.

#7 – How much does auto insurance cost per month for a 25-year-old?

The average monthly cost of car insurance for a 25-year-old driver is $233 per month.

#8 – How much is the cheapest auto insurance per month?

The cheapest car insurance option is liability insurance, which costs around $46 per month.

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