When you are searching for low-cost car insurance, you want to be sure that you are making proper comparisons of the right things. The main things you will need to compare are the coverage limits, the length of the term, the amount of the deductible, and the amount of the premiums. Understanding how these things affect you will help you make better comparisons as you look for inexpensive insurance options.
The coverage limits would be the most important issue when searching for cheap insurance. You may find that companies offering the very lowest prices are also offering the lowest coverage amounts. You should always plug in your own numbers for coverage so that you can make equal comparisons. It is a good idea to start with the numbers from your current policy for things such as liability or collision coverage. However, you should also look at those numbers after you have made the comparisons to see if they are adequate. The problem with having low limits on your car insurance coverages is that if you are involved in an accident that is determined to be your fault, you will be liable for any expenses that exceed those coverage limits.
In other words, if the liability limit for bodily injury is $5,000 per person with a total limit of $25,000 per accident and there are 8 people in the vehicle you hit and their costs are closer to $7,000 each, that would equal $56,000 and you would be held liable for the additional $31,000 to pay for their medical costs. It is definitely worth paying a little more on your car insurance premiums to avoid issues like that.
Next, you should carefully look at the length of the term. Some companies offer low introductory rates for the first six months, after which the rates jump up quite a bit. Other companies require that you sign up with them for a certain period of time. You should always take these things into account.
When you consider the amount of the deductible, you must keep the deductible to the same number when you are making comparisons. You should avoid car insurance companies that require a very high deductible, because that gives you less leverage over the price of the premiums. Generally, when you lower your deductible, you are increasing your premiums, and when you increase your deductible, your premiums will decrease. This gives you some control over the premium prices you will be paying. It is important to remember that wherever you set your deductible limit, you will have to pay that amount for each accident before the insurance portion of the payments kicks in. it is a good idea to keep that amount of money in reserve.
If you keep all other things equal, such as the coverage limits, the term, and the deductible amounts as you make car insurance comparisons, you should be able to select the insurance company based on the premiums they are offering. With other things equal, you should be able to go with the company with the lowest premium. This is the best way to be sure you are really getting low-cost auto insurance.