Auto Insurance Premium Comparison

Different Insurance Companies, Drastically Different Auto Premiums -- Save Money by Comparing Auto Insurance Rates

When purchasing auto insurance, it is imperative to check around and do an accurate and complete auto insurance premium comparison. Rates can vary by hundreds of dollars for the same coverage depending upon the pricing structure of the different companies. Differences in policies, such as discounts given or penalties for prior tickets and accidents, can have a great effect on the actual price that each customer pays for insurance.

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Generally, those consumers who drive the fewest number of miles per year and have the cleanest driving records will pay the lowest premiums. Of course, if they happen to drive an exotic automobile or live in a high-crime area that will cause the premiums to increase.

The Massachusetts Division of Insurance recently released an auto insurance comparison, and the results really illuminate potential differences among insurance companies. This example assumes a clean driving record, annual driving of 12,500 miles, and an insured driver who has been licensed for 25 years and drives a compact mini-van like a Dodge Caravan. The quoted premiums for this fictional driver ranged from $638 up to a whopping $1,086. The important thing to note here is the wide range of rates, and the importance of comparing insurance policies. The company with the cheapest quote in this example won't always be the least expensive for other drivers and other situations. But auto insurance premiums can differ dramatically, and you'll never know who's the lowest until you compare.

The lowest premium example was with GEICO, the Government Employees Insurance Company, at $638. The good news is that GEICO also offers lots of additional discounts, so the final premium could actually end up considerably lower. The company provides discounts for anti-theft equipment, multi-car coverage, group membership, or having other types of insurance policies with the company. Additionally, if you have a young driver, they will discount premiums for good students.

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USAA, the United Services Automobile Association, offers an example premium of $882. USAA will only extend coverage to those who are eligible for membership in the organization because they are affiliated with the United States military. They also offer a number of discounts: a good student discount, and a discount for students away at school, discounts for anti-theft equipment, lowered annual mileage, multi-car discounts, and even a discount for using public transit for commuting. Again taking into account the discounts, which aren't reflected in the example, the actual rate could be much lower.

A very similar rate is available through Metropolitan Property and Casualty Company at $884. They also offer discounts for reduced annual mileage, anti-theft equipment, group membership, multi-car discounts, years licensed, and use of public transit, as well as good student discounts.

State Farm Mutual Automobile Insurance Company offers an example premium of $890, with additional discounts allowed for multi-car discounts, annual mileage, and anti-theft devices.

Progressive Direct’s example rate for that same driver is $1,086, with discounts available for advanced driver’s education, lowered annual mileage, multi-car and other policy discounts, anti-theft discounts, number of years licensed, and discounts for students away.

Of course, this is just one example. For different drivers and different situations, the rates may be quite different. The important thing to note is that rates can differ by hundreds of dollars, so it's important to look around before getting an auto insurance policy.

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Using an online insurance comparison tool, you’ll be able to easily compare the rates of the top companies doing business in your area. Without online insurance comparisons, a lot of legwork is necessary to track down the same information. However, you can certainly see that it is worth taking the time to compare rates before you purchase coverage.