Best Car Insurance : What We Found
That doesn't mean shopping is a waste of time. But it's only one way to save on auto premiums, which these days are buffeted by a slew of variables, such as:
Rising costs. There's nothing funny about how auto-insurance premiums have skyrocketed since 2013, up nearly 10 percent, which is more than six times the rate of overall inflation. If your income is still treading water in today's economy, car insurance is taking a bigger bite out of your household budget.
Credit-based insurance scores. Hard times have hurt many consumers' credit scores. That could result in rate increases, thanks to most carriers' use of credit scores in setting premiums. Even if they have a perfectly clean driving record, policyholders can pay hundreds of dollars a year more for car insurance if they have anything less than the best credit score, as secretly calculated by each insurer using methods that produce very different scores than the FICO score with which you're more familiar.
Uninsured motorists. The putt-putt economy, unemployment and underemployment, and high premiums have also contributed to an estimated 30 million consumers driving without insurance. That could shift some or all of their liability costs to you.
Corner-cutting repairs. Some insurers push policyholders to get their cars fixed at specified repair shops, which left our readers less satisfied, so that the companies can cut costs, often through use of cheaper aftermarket replacement parts.
Some cost factors are beyond your control, but there's still plenty you can do to cut your premiums for the auto coverage you need.
Control Insurer Cost Factors
Do a Rate Check Every 2 or 3 Years
Car insurance is a major expense that you'll pay as long as you own a car, so you should invest time to get the best deal. Premiums vary widely by state and carrier. But generally speaking, you'll spend $9,000 to $14,000 over 10 years if you're single to insure one car; $13,000 to $20,800 for two cars if you're married. (Those prices aren't adjusted for inflation.) Shopping smartly can thus help you get the coverage you need at the low end of those price ranges, for savings worth $5,000 to $7,800.
Car insurance is a major expense that you'll pay as long as you own a car, so you should invest time to get the best deal. Premiums vary widely by state and carrier. But generally speaking, you'll spend $9,000 to $14,000 over 10 years if you're single to insure one car; $13,000 to $20,800 for two cars if you're married. (Those prices aren't adjusted for inflation.) Shopping smartly can thus help you get the coverage you need at the low end of those price ranges, for savings worth $5,000 to $7,800.
Dig out a copy of your current policy plus records of any at-fault accident claims and moving violations. You'll be asked for this information every time you request a premium quote, and if you have it at your fingertips, the burden of shopping for car insurance can be made a little easier.
Our 2015 study of more than 2 billion car insurance premiums that major insurers charged 20 hypothetical drivers we created in every U.S. general ZIP code, can help take some of the legwork out of your comparison shopping.
Unfortunately, most consumers, 75 percent, haven't shopped for auto insurance in the previous year, and of those who did, most researched only one or two companies, according to one recent insurance-industry survey. By looking further afield, you'll have a better shot at savings.
Because your coverage needs and credit scores change, and insurers generally update their prices every six to 12 months, repeat this shopping comparison every two or three years.
Also shop the market whenever your situation changes, say, if you marry or you need to add a teen to your policy. Ask your insurer what the change will mean for your policy, then shop for a better deal. Forget about getting a separate policy for your teen; we priced that, too, for our 16-year-old sample boy and girl drivers with their own policies, and the premium was almost always more than the increase in cost from adding the kids to their family policy.
Pick a Top-Rated Insurer
Saving is not only a matter of finding the lowest premium. An insurer can charge less in premiums but cost you more overall by lowballing loss estimates, hassling the repair shop to cut corners, and forcing you to pay extra for the manufacturer's replacement parts if you choose them over cheaper knockoffs. It can also unfairly jack up your premiums after an accident.
Saving is not only a matter of finding the lowest premium. An insurer can charge less in premiums but cost you more overall by lowballing loss estimates, hassling the repair shop to cut corners, and forcing you to pay extra for the manufacturer's replacement parts if you choose them over cheaper knockoffs. It can also unfairly jack up your premiums after an accident.
We surveyed 64,872 ConsumerReports.org subscribers who filed a claim between 2011 and 2014. Eighty-eight percent of them were highly satisfied with the handling of their claims. Among the highest-rated groups were USAA, Amica, and NJM, with overall satisfaction scores of 90 or higher. Those three insurers have consistently earned positions at the top of our ratings at least since 1999. Availability for some insurers is limited by region or policyholder eligibility rules.
Set the Deductible RightA higher deductible reduces your premium because you pay more out of pocket if you have a claim. Hiking your deductible from zero to $1,000 can cut your premium on collision by 0 to 47 percent, on average, depending on which state you live in. The dollar savings, which are related to the overall cost of insurance in your state, ranged from $159 or 20 percent in Ohio to $1,080 or 47 percent in Georgia for the sample single drivers we studied. If you have a good driving record and haven't had an at-fault accident in years, or ever, opting for a higher deductible on collision might be a good bet. Just make sure you can afford to pay it if your luck runs out.
Review all of your coverage. Your liability coverage pays for bodily injury and property damage that you cause in accidents. Don't get caught short by reducing your liability limits to the state minimums. Buying more coverage might seem like an odd way to save, but the benefit comes if you have a costly claim, which can put your personal assets at risk. Buy standard 100/300/100 coverage, which pays for bodily injury up to $100,000 per person and $300,000 per accident, and property damage up to $100,000. If you have a high net worth, boost bodily injury to $250,000 per person and $500,000 per accident.
One of every eight drivers today may be uninsured, according to the Insurance Research Council. If you get hit by an uninsured at-fault driver, you'll have to pay for repairs out of your own pocket, and good luck suing the at-fault driver for damages. Protect yourself by buying uninsured/underinsured motorist protection with the same limits as your liability coverage.
You can probably cancel your collision and/or comprehensive coverage when the annual cost equals or exceeds 10 percent of your car's book value. Otherwise, you could end up paying more over time than you would recoup for repair or replacement of your damaged, stolen, or totaled vehicle.
If you have another car that you can use while your vehicle is being repaired, you don't need to pay for rental-reimbursement coverage. Dump roadside assistance if you have an auto-club membership that's a better deal. Think carefully about personal-injury protection and medical-payments coverage: Forget it if you have good health coverage; keep it if you don't or if your usual passengers might not be well insured.
Watch Crash Repairs Closely
Claims payment is where the rubber hits the road in car insurance. Your insurer might push you to use shops in a direct-repair program (DRP) or use cheaper replacement parts, rather than the original equipment manufacturer (OEM) parts. Tests by Consumer Reports and others have found that some non-OEM parts fit poorly, are more prone to rust and corrosion, don't always meet federal safety standards, and may not provide good protection in a crash.
Claims payment is where the rubber hits the road in car insurance. Your insurer might push you to use shops in a direct-repair program (DRP) or use cheaper replacement parts, rather than the original equipment manufacturer (OEM) parts. Tests by Consumer Reports and others have found that some non-OEM parts fit poorly, are more prone to rust and corrosion, don't always meet federal safety standards, and may not provide good protection in a crash.
In our survey, respondents' satisfaction with repairs was significantly lower among those who felt pressured to use DRP shops and non-OEM parts. And respondents who said they were pressured to use non-OEM parts had significantly more problems with their repairs.
