How to Estimate Your Car Insurance


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Car insurance estimates are far from being one-size-fits-all. In fact, the rate you receive will likely be do to a mix of factors. Here’s a closer look at the different factors that may impact how much you’ll have to pay each month to keep your car insured and how to compare quotes.

What determines your car insurance rate?

  • Your driving record: Put simply, the more accidents and traffic violations you have under your belt, the higher your premium is likely to be. Similarly, if you’re a newer driver without an established driving record, you’ll likely also pay more than an experienced who’s never had trouble on the road.
  • How much you use the car: Additionally, the amount of time you spend in the car plays a role. If you spend a lot of time behind the wheel or drive long distances, you’re going to pay more than someone who only drives around town once in a while.
  • Your location: Due to having a higher occurrence of vandalism and theft, urban drivers tend to pay more than those who live in suburban or rural areas. The area where you park your car, on the street or in a protected garage, for example, can also make a difference in what you’ll be charged.
  • Your age: Since younger drivers tend to have less experience behind the wheel, they’re more likely to get into accidents than mature drivers. If you’re under the age of 25, you’ll likely pay more for car insurance than someone who’s older.
  • Your gender: According to the Insurance Information Institute, women are statistically less likely to get into serious traffic accidents than their male counterparts. As a result, they tend to pay lower car insurance premiums.
  • Your credit: Similarly to how lenders use your credit score to determine how likely you are to pay back a loan, insurers use what’s known as your credit-based insurance score to predict how likely you are to file a claim.
  • The type and amount of coverage you’ve selected: Any limits on your car insurance, how much you’ll pay in a deductible, and other options you’ve chosen all play a role in determining your rate.

It’s important to note that, while each of these factors may play a role in determining how much you’ll pay for your premium, each insurer will weigh them differently. That’s why it’s so important to shop around and compare quotes before deciding which policy is the best fit for you.

How to figure out your car insurance estimate

The first step to estimating the cost of your insurance is to think about how much coverage you’ll need. For starters, you should look into your state’s minimum coverage requirements in order to ensure that the policy that you end up purchasing will be compliant. Then, take the time to consider what, if any, additional coverage you may require.

Believe it or not, there are several different coverage types that can be included in a policy. For example, most states require you to carry some measure of bodily injury liability insurance (BI) and property damage liability (PD). However, costs not covered by those coverage types or costs that exceed your policy limits will need to be paid out of pocket. Plus, though they are not required as often, there’s also uninsured motorist coverage, personal injury protection and comprehensive coverage options to consider.

Ultimately, estimating your costs is about deciding upon which coverage options and policy limits make you feel comfortable enough to get on the road. From there, you can start to collect quotes from a variety of providers and make comparisons.

Factors to consider when comparing quotes

When comparing car insurance estimates, the first thing you’ll want to do is ensure that you’re making an apples-to-apples comparison. Make sure all the policy details you provide, whether it’s your personal information or coverage selections, are the same for each quote. That way, you can be sure that you’re being offered a similar product from each company.

Next, you’ll want to look at the price compared to the services that are included and any notable exclusions. Typically, similar car insurance quotes will fall within the same range, price-wise. If there’s an outlier, or one quote that’s much cheaper than the others, that’s not necessarily a good sign. It usually means that you’re not being offered the same services or as much coverage as with the other policies and that you need to do more research into what is and is not included.

Finally, you’ll want to look at the options for any additional services that can be added on to your policy, as well as any opportunities to secure a discount. While each company’s offerings will be different, some will work better for you than others. At the end of the day, choosing the right policy is about balancing affordability with enough coverage to make you feel comfortable getting behind the wheel.