Is buying car insurance online safe?

Most major companies in the US provide car insurance online. Avoid scams by (1) checking financial ratings, (2) reading customer reviews, and (3) comparing quotes for car insurance online.

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A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP®

UPDATED: Jan 22, 2021

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Here's what you need to know...

  • As with all online shopping, buying car insurance online requires precaution
  • Always avoid sites that look spammy or do not have a high-encryption level to protect your identity
  • Studies show those who compare auto insurance quotes online get better deals and pay less annually than those who don’t

When it comes to car insurance, getting the most coverage with the lowest premiums is everyone’s goal. Thanks to the Internet, we can find dozens of quotes and car insurance companies with a simple Google search. But is buying car insurance online really safe?

After all, insurance requires you provide all sorts of personal information such as your full name, address, and social security number.

The good news is that for smart shoppers, buying car insurance online is safe and can save you hundreds of dollars a year.

With millions of dollars at stake, car insurance behemoths have every motive to keep your data and everyone’s money as safe and secure as possible.

Enter your ZIP code above now to compare rates!

You will find that purchasing coverage online is relatively easy and painless. If you’re still not sure, you can always shop for quotes online and then call up a car insurance company representative to purchase the policy that fits your needs.

Are there legitimate safety concerns to shopping online?

The answer to that is “yes,” yet they are the safety concerns that are involved in any kind of online shopping. Secure sites get hacked all of the time.

Here’s a list of certain things you should do to make sure that your online car insurance purchase isn’t the same as a bad online poker-playing experience. However, these things should be second nature to you if you’ve been exploring and surfing the web for more than five years.

– Stay Away from Spam Sites

Avoiding spam sites should be obvious, but many state insurance commissioners always urge that you take a look at the insurance company from which you’re buying. If it’s one of the bigger companies, like Geico or Progressive, then you’re probably in good hands (as one of their competitors would say).

If it’s a state-wide or regional insurer, then you might want to check them out. Does this company receive a lot of complaints? How is its Better Business Bureau rating?

– Shop on Secure Sites from Trusted Companies

Most of the higher level auto insurance companies are using this already, but you should only shop at websites that are using high-level encryption.

For example, State Farm, which has an online security page, tells the public to use certain kinds of browsers (the usual suspects of Explorer, Safari 4, Firefox, and Google Chrome) that provide a high level of encryption.

State Farm claims that, by using this kind of security, your vital information–most notably your Social Security number, which insurance firms need to check your driving record–will be safe from hacker hooligans.

– Use a Credit Card or Disposable/Secondary Debit Card for Transactions

The main advantage of using a credit card is that many credit cards offer identity theft protection. Just make sure you check your credit statement to ensure that there are no fraudulent charges.

You could also use a secondary debit card. If debit card A has several thousand on it and is meant to pay a mortgage, while debit card B is loaded with several hundred dollars in extra money, then use debit card B.

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What do insurance companies say about online risk?

Most of the reputable insurance companies have online security pages. If you’re not aware of this, a lot of money is involved in auto insurance.

Companies have a deep and abiding interest in keeping your money and their money as safe as possible.

You can usually find their privacy and security information on their home pages.

Is shopping online worth the risk?

Many state insurance commissions recommend that you shop online in order to get savings on car auto insurance rates. The insurance commissions of some states, like Massachusetts and Florida, even link directly to sites where you can compare auto insurance rates.

Insurance commissioners also openly recommend that you use online auto insurance services to lower your auto insurance rates. The State of Massachusetts even ordered a study showing that consumers that shopped around for better prices online got better deals on their auto insurance rates.

According to one of the study’s many colorful charts, 81.7% of the people who shopped around online for a better deal did so in order to save money on their auto insurance rates.

The study also stated that drivers have saved nearly $500 million on auto premiums since 2008 began.

The study also confirmed that 37.8% of the study’s participants did save money by comparing auto insurance quotes from different insurance companies. More than 27% of the study’s participants revealed that they saved over $300 at least by shopping online and comparing car insurance quotes. Eighteen percent saved more than $450 by comparing rates online.

The message of the study is that you can save lots of money by comparison shopping online.

Bottom line, while there are risks to shopping online, the rewards far outweigh the risks. It’s kind of like not flying because you’re afraid of lightning striking the plane. There’s that risk, but it’s negligible. The reward is saving hundreds of dollars on your auto insurance premiums. It’s well worth it.

Start safely buying car insurance online today by entering your ZIP code in our tool below!

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