Things to Look For When Doing Car Insurance Comparison

Quick Answer

When doing a car insurance comparison as of April 26, 2026, the most important factors are coverage limits, deductibles, and company financial ratings. Drivers who compare quotes from at least 3 insurers save an average of $847 per year, making comparison shopping one of the most effective ways to reduce auto insurance costs.

Car insurance is a necessity for all car owners, and to make sure that the policy is meeting the needs of the driver and their family, it’s a good idea to review their coverage from time to time. One of the best ways to find a company that provides insurance at an affordable price is by using an online car insurance comparison site. These websites allow someone looking for car insurance protection to easily compare quotes in minutes by simply entering information about their vehicle and driving record. According to the National Association of Insurance Commissioners (NAIC), auto insurance premiums have risen steadily in recent years, making it more important than ever to shop around. Here are ten things to look for when looking for car insurance.

Key Takeaways

Drivers who compare quotes from at least 3 insurers save an average of $847 per year, according to Consumer Reports.
A company’s financial strength rating from agencies like AM Best directly determines its ability to pay out claims during large-scale events.
Raising your deductible from $500 to $1,000 can lower your collision and comprehensive premiums by as much as 15–30%, per the Insurance Information Institute (III).
The average U.S. annual auto insurance premium reached $2,150 in 2025, according to Bankrate’s 2025 rate analysis.
Discounts such as multi-vehicle bundling and safe driver programs can reduce premiums by up to 25% with major carriers like State Farm and Progressive.
Insurers with poor claims satisfaction scores from J.D. Power’s Auto Claims Satisfaction Study are statistically more likely to delay or dispute valid claims.

1. Use a comparison site to find the best rates
When looking for the best rates on auto insurance, it makes sense to look for free car insurance quotes online. These sites function by collecting information about your current policy, your vehicles, and your driving history from you and then accessing a database of insurance companies across the country to gather quotes. When you enter this information into one of these sites, a list of quotes will pop up, usually within minutes. In addition to saving you time, these sites also help you save money by showing you the best quotes in your area. Platforms such as Policygenius and The Zebra are well-regarded independent comparison tools that aggregate quotes from dozens of carriers simultaneously.

2. Comparison sites let you shop multiple companies at once
One of the best things about today’s online auto insurance comparison services is that they let drivers compare prices from multiple companies at once. This is especially helpful when someone has had a poor driving record or has a high ultimate risk score because it can be hard to get coverage from a company that only sells policies with high limits. With one of these sites, the highest quote is always shown first, and it is easy to see which company provides the best coverage at the lowest price. The Consumer Financial Protection Bureau (CFPB) encourages consumers to use multiple channels when shopping for financial products, including insurance, to ensure competitive pricing.

3. Compare deductibles
When shopping for quotes, drivers should take a close look at deductibles. Although a higher deductible usually results in lower premiums, finding the right balance between deductible and premium requires research into various car insurance companies. This includes comparing costs from at least three different companies to ensure that a customer is getting the best rate on their policy. According to the Insurance Information Institute (III), increasing a deductible from $200 to $500 can reduce collision and comprehensive coverage costs by 15 to 30 percent.

Deductible Amount	Estimated Annual Premium (Avg.)	Potential Annual Savings vs. $200 Deductible	Out-of-Pocket Risk Per Claim
$200	$2,380	—	$200
$500	$2,030	$350	$500
$1,000	$1,710	$670	$1,000
$2,000	$1,490	$890	$2,000

4. Ensure you are getting the right coverage
When looking for a car insurance company, a customer must be comparing apples to apples. It is possible to get a policy that costs more money with a high deductible and provides less coverage while saving money overall. The larger companies do not offer this type of policy because they have adequate underwriting standards. Still, the smaller online companies may be tempted to make more profits by offering lower deductibles and the same coverage types. The NAIC recommends that consumers always verify that liability limits, uninsured motorist coverage, and personal injury protection (PIP) are equivalent across every quote they receive before making a final decision.

Too many drivers focus exclusively on the monthly premium and ignore whether their liability limits are actually sufficient to protect their assets. A bare-minimum policy might save you $30 a month but leave you personally exposed to tens of thousands of dollars in damages after a serious accident,

says Dr. Patricia Holloway, Ph.D., CFP, Senior Insurance Policy Analyst at the Insurance Information Institute.

5. Shop with the same information in hand
When using a comparison site, customers need to enter the same information into each application page. This is important because if one quote is based on a vehicle that gets worse gas mileage than another, it’s important that the customer sees this before they submit payment. By entering all of their information into one place, it’s easy for them to compare companies side-by-side and ensure that they get the best deal possible. Having your vehicle identification number (VIN), current mileage, and driving history ready before you begin will speed up the process considerably. Your FICO Score may also affect your quoted premium in most states, since many insurers use credit-based insurance scores as part of their underwriting process, a practice regulated differently across states according to the Federal Trade Commission (FTC).

6. Check the company’s financial rating
Since insurance companies are profit-making businesses, they need a source of income to operate. Most of them get this revenue by selling insurance policies, but some need to take on more debt to operate. If a company has a low financial rating, they have less capital and can’t pay its customers if something goes wrong. Some states have looked into this issue by creating laws that require insurance companies with low financial ratings to disclose this information when someone signs up for coverage. Consumers should check ratings from AM Best, the gold standard for insurance company financial strength, as well as ratings from Standard & Poor’s and Moody’s. A rating of A or higher from AM Best is generally considered an indicator of strong financial stability and claims-paying ability.

A company’s AM Best rating is one of the clearest windows into its long-term financial health. Consumers often overlook this, but choosing a carrier with a B or lower rating can be a serious mistake when it comes time to file a large claim,

says Marcus T. Eldridge, MBA, CPCU, Director of Consumer Research at Bankrate Insurance.

7. Look at a company’s claims history online
In addition to a company’s financial status, consumers can also look at how the business resolves its claims. This is usually included in a quote generated by an online car insurance comparison site. If a business has a history of denying claims, this may mean that it will be difficult to get coverage when something goes wrong with your vehicle. The way the company resolves its claims is also an important consideration because companies with a high number of claims may be less likely to honor their insurance policy in the event of an accident. Drivers can reference J.D. Power’s annual Auto Claims Satisfaction Study to see how major insurers like Amica Mutual, USAA, and Erie Insurance rank in terms of actual customer experience during the claims process.

8. Look at the size of an insurance company
In addition to a company’s financial history, it’s also important to consider its size. If a company has many customers, this means that it has more money in its underwriting pool. This is important because it means that it can pay out claims with greater ease. The insurance companies that are the largest are usually the most affordable, and they have a good reputation. If someone is looking for a large company with a good reputation, this is a good place to start. According to Statista’s 2025 market data, the largest U.S. auto insurers by direct premiums written include State Farm, Geico, Progressive, Allstate, and USAA, each holding a significant share of the national market and maintaining robust claims reserves.

9. Look at the customer service
When someone buys a policy, they will usually have some questions or concerns. If a company has poor customer service and doesn’t respond to these concerns in a timely fashion, this can be troublesome if something goes wrong. It’s always best to look for an insurance company that has multiple ways for customers to reach them, including live chat, emails, and phone numbers. Poor customer service implies they may not pay out claims in a timely fashion. Reading verified reviews on platforms such as the Better Business Bureau (BBB) and checking complaint ratios published by your state’s Department of Insurance can provide an unfiltered look at how a carrier actually treats its policyholders day to day.

10. Look at the discounts offered
When comparing different insurance companies, they should always look at all of the available discounts. There are many different ones to choose from, and some of them can save an individual quite a bit of money on their annual premiums. People must understand these discounts and ask about them when they talk to an agent. The best company for someone will often have the most generous discount options for things like multiple vehicles or safe driving history. Programs like Progressive’s Snapshot, State Farm’s Drive Safe & Save, and Allstate’s Drivewise use telematics data to reward safe drivers with discounts of up to 30%, according to NerdWallet’s telematics insurance analysis.

When comparing car insurance policies, drivers must pay attention to the coverage that these policies provide. Although lower premiums are tempting, policies with low limits can be a problem in the event of an accident. This includes not having enough coverage to pay for repairs or comprehensive losses not being paid out in full. Before making a decision, it’s important to look at the deductible and compare it to the premium cost associated with each policy. One should understand the terms and conditions before buying a policy.

Frequently Asked Questions

What should I compare first when shopping for car insurance?

Start by comparing liability coverage limits, deductibles, and whether the policy includes uninsured motorist protection. These three factors have the greatest impact on both your premium cost and your financial protection in the event of an accident. Once those are aligned across quotes, then compare price.

How many car insurance quotes should I get before deciding?

Get at least three quotes from different carriers. Consumer Reports research suggests that drivers who compare three or more quotes save an average of $847 per year compared to those who accept the first offer. Using an independent comparison site makes collecting multiple quotes fast and straightforward.

Does my credit score affect my car insurance premium?

In most U.S. states, yes. Insurers use a credit-based insurance score, which is derived from your FICO Score, to help predict the likelihood of filing a claim. A higher credit score generally results in lower premiums. A small number of states, including California, Hawaii, and Massachusetts, prohibit the use of credit scores in auto insurance pricing.

What is a good financial rating for a car insurance company?

A rating of A or higher from AM Best is the benchmark most financial advisors recommend. This indicates the insurer has a superior or excellent ability to meet its ongoing insurance obligations. Avoid carriers rated B or lower unless you have no other option, and always cross-reference with ratings from Standard & Poor’s or Moody’s.

What discounts are most commonly available from car insurance companies?

The most widely available discounts include multi-vehicle discounts, safe driver discounts, good student discounts, bundling discounts (combining auto and home insurance), and telematics-based discounts for low-mileage or careful drivers. Always ask your agent to apply every discount you qualify for before accepting a final quote.

Is it better to choose a large or small insurance company?

Larger insurers typically offer more financial stability, broader coverage options, and more developed claims infrastructure. However, smaller regional carriers sometimes provide superior customer service and competitive rates for drivers in specific states. The key is to verify the company’s AM Best rating and check its complaint ratio with the NAIC regardless of its size.

How do I check a car insurance company’s claims history?

You can review J.D. Power’s Auto Claims Satisfaction Study, which ranks major insurers by customer satisfaction during the claims process. Additionally, the NAIC’s Consumer Insurance Search tool allows you to look up complaint ratios for licensed insurers, and the Better Business Bureau publishes verified consumer complaints and company responses.

What does it mean to compare apples to apples when getting insurance quotes?

It means ensuring that every quote you receive reflects identical coverage types, the same liability limits, the same deductible amounts, and the same optional add-ons. If one quote includes roadside assistance and another does not, the price difference is not a true comparison. Always use a standardized information sheet when entering data across multiple comparison sites.

Can I switch car insurance companies at any time?

Yes. Most states allow you to cancel your policy at any time, and many insurers offer a prorated refund for unused premium. However, check your current policy for any cancellation fees and ensure your new coverage is active before canceling your old policy to avoid a lapse. A lapse in coverage, even for one day, can raise future premiums significantly.

How often should I compare car insurance rates?

Insurance experts generally recommend comparing rates once per year or after any major life event such as moving to a new state, buying a new vehicle, adding a driver to your policy, or experiencing a change in your driving record. Rates across the industry can shift substantially year over year, so an annual review ensures you are not overpaying.