Auto insurance tips

When you really need it, you will be glad you took the time to purchase good car insurance. The purpose of the articles in this section is to prepare drivers with the right car insurance policy before it is too late. Then, if trouble strikes, you and your family--and your family's finances--will be protected.

Everyone knows that car insurance can be expensive. However, in the Internet era, getting an online car insurance quote is fast and easy. With the resources and information we present here, it is easier than ever to compare car insurance quotes. We will also tell you what differences exist between one car insurance company and another. Basic coverage is described and comparative shopping strategies are clearly outlined. What about teenage drivers? We take a special look at shopping for car insurance for them. What if you have car insurance but can't keep up with the expensive premiums? We might be able to show you how to continue getting the coverage you need while reducing your payments. And, finally, what about the mysterious type of insurance called "gap insurance"? This is a form of car insurance that usually applies to leased cars. In some cases, however, a car buyer might also need gap insurance. We'll tell you when and how much to buy.

If you are on the fast track, and need car insurance now, we've boiled down all our information into the easy-to-read "10 Steps to Buying Car Insurance." This series of short articles is followed by a checklist that will ensure that you won't overlook any important details as you get the best coverage available.

10 Steps to Buying Car Insurance

The following simple steps will help you determine how much car insurance you need to carry. And it will also help you get the best coverage at the lowest price.

Step 1: Starting Out

When it comes to car insurance, you want to be adequately covered if you get in a car accident but you don't want to pay any more than you have to. So how can you navigate your way through this murky subject?

Keep telling yourself there is money to be saved. How much? Hundreds, even thousands, per year. For example, one of our editors typed all of his car insurance information into a comparative insurance service. The quotes (for very basic coverage on two old cars) ranged from $1,006 to $1,807 — a difference of $801 a year. If you're currently dumping thousands into your insurance company's coffers because of a couple of tickets, an accident or a questionable credit rating, shopping your policy against others may be well worth the effort.

Look at it this way — you can convert the money you save into the purchase of something you've desired for a long time. Hold that goal in your mind.

Step 2: How Much Coverage Do You Need?

To find the right car insurance, start by figuring out the amount of car insurance you need. This varies from state to state. So take a moment to find out what coverage is required where you live. Make a list of the different types of coverage and then return for the next step. (You will find a list of each state's requirements and an explanation of the various types of insurance in "How Much Auto Insurance Do You Really Need?" Also, check out "Little-Known but Important Insurance Issues" as it has a glossary of basic insurance terminology.)

Now that you know what is required, you can decide what you need in addition. Some people are quite cautious. They base their lives on worst-case scenarios. Insurance companies love these people. That's because insurance companies know what your chances are of being in an accident, and how likely it is for your car to be damaged or stolen. The information the insurance company has collected over previous decades is crunched into "actuarial tables" that give insurance adjustors a quick look at the probability of just about any occurrence.

Step 3: Review Your Driving Record and Current Insurance Policy

Before you begin shopping for car insurance you should check the following: the status of your driving record, your current coverage and the premiums you are paying.

you should contact your car insurance company or pull out a recent bill. Jot down the amount of coverage you have and what you are paying for it. Take note of the yearly and monthly cost of your car insurance since many of your quotes will be given both ways. Now you have a figure in mind to try to beat.

Step 4: Solicit Competitive Quotes

Now that you have made several practical and philosophical decisions, it's time to start shopping. Begin by setting aside about an hour for this task. Bring all your records — your current insurance policy, your driver license number and your vehicle registration. Drink plenty of coffee. Have a phone at your elbow. And, of course, power up your computer.

A few things to keep in mind: 1) When you use quote sites, you may not get instant quotes. Some companies may contact you later by e-mail, and some that are not "direct providers" may put you in touch with a local agent, who will then calculate a quote for you. (A "direct provider," like Geico, sells an insurance policy to you directly; other companies like State Farm sell insurance through local agents. We'll discuss the pros and cons of each later.) 2) It's not easy to get quotes from these sites in all states — if you live in New Jersey, for instance, you'll probably find it faster to pick up the phone, since most insurers in this state currently don't provide online quotes.