Zaneta Wood, Ed.S. has over 15 years of experience in research and technical writing bringing a keen understanding of data analysis and information synthesis to reach a wide variety of audiences. She studied adult education and instructional technology at Appalachian State University as well as technical and professional communication at East Carolina University. Zaneta has prepared technical p...

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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: Oct 5, 2020

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Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.

Here's what you need to know...

  • Regardless of where you live, you must have some form of auto insurance or proof of financial responsibility
  • Where you live will affect how much you pay for auto insurance
  • Insurance companies offer discounts for safe drivers, multiple types of policies, multiple car policies, and loyalty discounts

Which company offers the best rates for auto insurance coverage? No matter which state you live in, if you drive a car, you are going to have to have some sort of insurance in case you are involved in an accident.

Some states allow for you to show a certificate of financial responsibility or to submit a deposit to the DMV in lieu of purchasing insurance through more traditional means.

To compare personalized auto insurance quotes online from top car insurance companies then enter your ZIP code above to start finding car insurance now!

Table of Contents

The Factors that Decide What You Pay for Car Insurance

The first thing that you need to understand is that where you live will affect how much you pay for auto insurance.

In some states, the Department of Insurance or the Secretary of Insurance establishes a base rate for auto insurance, establishing what an insurance company can charge for each level of coverage.

In those states, you will find that there is little difference between what each insurance company charges. Most states, however, do not determine how much an insurance company can or cannot charge, which makes the rates in those states more competitive.

Based on state, Arizona, North Dakota and Washington, D.C. all saw the largest rate declines in 2009. However, D.C.’s average rate is still around $2700 while Arizona’s is closer to $1450.

There are quite a few things that will determine the price of your auto insurance. First of all, where you live is a very important factor.

Certain areas  are considered at higher risk  than others for drivers and their vehicles in general. For example, neighborhoods with higher crime rates, especially car theft rates, will see higher rates for auto insurance.

Another thing that is taken into consideration is how much you drive your vehicle. The less you drive the less you will pay for your car insurance. The longer you are on the road the more you are at risk of having an auto accident.

The type of car that you drive will also determine how much you pay for your auto insurance. Many people are under the misconception that if they purchase a new car that they will see lower rates.

A new car equals a larger cost and a larger cost means that the insurance company will have to fork over more money if you have an accident or your vehicle is stolen.

In addition, if you finance your new vehicle, you will have to get a comprehensive insurance policy (required by your lender), which is much more expensive than purchasing your state minimums.

The driver’s age and gender also play a role in the total cost of auto insurance. Girls cost less than boys (just as women cost less than men). Study after study shows that females are better drivers overall.

However, teenagers are going to increase your insurance costs significantly and in many states, the costs are going to increase whether you let your child drive your vehicle or not.

Many insurance companies will assume that your licensed teen driver will drive your vehicle at one time or another and will charge you accordingly. Many of those costs are 150 percent or more than your current costs.

Other things that are taken into consideration are your driving record, your credit score, whether you are married, if you have a college degree, what you are using your vehicle for, and how many past claims you have made for your past (or current) automobiles.

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Ways to Decrease Your Car Insurance Rates

Although it may sound like a pipe dream, there are ways to save money on your car insurance. Each insurance company offers discounts for different things. What these discounts are will vary from company to company.

For example, Progressive offers a good student discount for drivers. If you have good grades, you will qualify. This applies to students of any age, including adult students.

However, many companies stipulate that you have to be under 21 to qualify for this discount.

Companies also offer discounts for safe drivers, multiple types of policies, multiple car policies, loyalty discounts, and limited driving discounts.

When you consider a policy, visit the site of the insurance company you are considering and look for their discounts page.

How to Get the Best Car Insurance Rates

In order to get the very best rate possible, you are going to have to compare the coverage offered by multiple insurance companies. You should compare at least three different quotes. The easiest way to do this is by using a free quote tool like the one we have at the top of the page.

There are many reasons that a free quote tool offers you the best option. First of all, it is easier.

If you were to do an independent search, you would have to fill out questionnaires and forms on every site that you visit, answering the same questions over and over again.

The second reason that a quote tool is so good is that you won’t have to search for insurance companies that sell auto insurance in your area. You might be surprised to learn that some companies are not licensed in every state.

When you use a quote tool you are only quoted prices from your specific area, (which is why the first thing you are asked for is your zip code).

Lastly, a quote tool ensures that your quotes only come from reputable companies.

Like any big purchase, you are still going to want to check online for customer reviews, check the Better Business Bureau and so on about your choices, but you will have a good head start with highly regarded companies.

Choosing the cheapest car insurance rates does not have to be difficult. Enter your ZIP code below to get started with no obligation now!