Every six months our car insurance policies come up for renewal. Sure the easiest thing is to just renew it and forget about it. However, since my debt pay off journey and my general interest in personal finance/ financial independence began, I look for the best deals. Maybe shopping every 6 months is not necessary but I would argue that shopping your automotive policy once a year is a prudent exercise.
It takes a little extra time but it can be a worthwhile exercise. I had been with the same insurance company, Allstate, for years and I liked them. However, when I decided to shop them and found I could save over $100 for a new 6-month policy if I switched to Progressive. I made the switch.
Now, I shop it every renewal or at least once a year. Although, my progressive rates have remained competitive for three years so I almost didn’t shop it this renewal, but as you’ll read on, I’m so glad I did…
How/Why to Shop Your Auto Insurance Yearly
So it’s pretty simple to quote other automobile insurance companies online. I typically like to review three different companies because three is a blessed number. That being said, I consider my existing policy as one so I only need to obtain two other auto insurance quotes.
Know Your Existing Policy Details
The first thing you’ll want to do is view your current policy details. If you haven’t done so already, create an online account with your current auto insurance carrier. Go to your auto insurance carrier’s website and create an account. You’ll have to enter some identifying information and then you’ll create a username & password which will link to your current policy.
Next, you’ll want to view your policy details:
- Uninsured/underinsured motorist bodily injury
- Bodily Injury & property damage
- Medical payments (not necessary in my opinion if you have medical insurance)
- Comprehensive deductible (Mandatory if you finance your car)
- Collision deductible (might not be necessary if your car is paid for and you have a car fund large enough to replace your car)
- Uninsured motorist property damage (cannot add if you have collision)
- Rental reimbursement
- Roadside Assistance
- Loan/lease payoff
Now that you are fully aware of your policy details, coverage limits, and deductibles, you are ready to start comparing quotes. You can obtain a free quote from all auto insurance carriers by going to their website and putting in some demographic and driving information. Often times the competing carriers can pull your existing policy and try to match up a quote. However, if you do this I still recommend taking the time to compare the coverage to your existing policy.
I obtained one quote where they pulled my existing policy and did a “match” but it was a bit richer than what I currently have. I was able to go in and edit the quote to be more of a match to my existing policy.
This renewal, in addition to receiving my renewal quote from Progressive, I obtained quotes from USAA and Geico. To obtain and purchase a quote from USAA you must either be a military member have a military member in your immediate family. My father is a veteran and so I qualify. A few years back when I first started obtaining quotes from USAA, my father & I had to call USAA to get my log in set up. Now that it is, I can simply quote every renewal and purchase if I so desire.
So here are my 6-month comparable options (keep in mind these rates are if I pay in full which I do because of the discount):
- Progressive – $600.00
- Geico – $486.91
- USAA -$507.18
As I said earlier, I almost didn’t quote this renewal because for the last three years progressive has been the most competitive. However, it’s apparent my rates with Progressive have jumped a bit and there are more compelling options.
So who am I going with??? You might be surprised to learn that I’m not choosing the cheapest option, Geico, and that reason is threefold. 1.) USAA bodily injury & property damage is slightly better. Their closest match to my existing is higher so that’s a win. 2.) I know others who have USAA and speak highly of the coverage and customer service. 3.) I’ve heard that police view USAA insureds more favorably because who doesn’t appreciate military service?!
Now I don’t know if point 3 is true or not but I’ve always wanted to try USAA and now I finally have a compelling reason to do so.
Agent and Loyalty?
Long gone are the days where we stay with the same insurance company and/or even the same agent for years. I’m not sure why but with car insurance it seems agents are usually tied to one insurance company. While you may like your agent, there’s little reason to stay with them when you find a more competitive quote with an insurance carrier they don’t represent.
While I’m a fan of agents, heck I’m a licensed health and life insurance agent, I would never recommend staying with the same carrier just so you can keep your agent. This is where car and health insurance agencies differ. As health and life agents, our brokerage represents and can sell many different health insurance carrier products.
And as far as loyalty with one auto insurance carrier, I say why? If they keep remaining competitive and offer loyalty discounts, then sure. However, it seems that insurance prices creep up over time with one carrier and the best hedge against that is to shop.
Shopping for auto insurance is really quite simple. It took me a whole 1/2 hour to do the exercise of reviewing my current policy and obtaining two comparable quotes. Furthermore, I was able to complete said task online.
I recommend, at least shopping your auto policy once a year. However, if you are like me and are comfortable shopping every 6 months at renewal time, there is no harm in that. If you confirm your existing policy is the best deal, great! Now you can have peace you’ve done your due diligence. And if you find a better deal elsewhere, also great! Then it’s time to make the switch.