Car Insurance Buying Guide

Buying car insurance may seem confusing, but once you understand the basics it is much easier than it appears at first. You need to know how your car and driving habits play a part in determining your premiums, and it helps to be aware of how your individual information is factored in as well. Don't buy more insurance than you need, and always shop around a little before signing an insurance contract. When you follow those four simple steps, getting the right coverage at the right price is no longer a challenge.

Driving Related Insurance Factors - The make and model of your car is a major insurance factor, and based on such things as highway safety ratings, factory-installed safety devices, and the actual book value of the vehicle. Your driving record is also important, and most insurance companies will look at your driving history for the past 3 years, but some may go back as many as 5.

Individual Insurance Factors - Your personal factors will also have an impact on your premiums. The zip code you live in, your marital status and how far you drive to work each day are all important in setting your premiums. Similarly, your age and educational level are important, and your credit score helps the insurance company determine your financial risk.

Buy Only What You Need - Be wary of purchasing more insurance coverage than you need, but make sure to get enough coverage. Older cars may not need to have collision coverage because you can afford to replace the vehicle as cheaply as repairing it, for instance. By the same token, free roadside service or towing may be more important for older cars than new ones. Comprehensive coverage will replace your windshield if a rock gets thrown up from the road causes a crack, but it will also cover the contents of the vehicle if it is broken into while you are shopping.

Compare Prices Before Buying - Compare the prices for your coverage with multiple insurance companies to make sure you are getting the best deal for your money. Use a free insurance quote from a website such as this one, and you can customize your insurance policy and then see what that exact coverage will cost you from several different insurance providers.