What to Compare Beyond Price in Car Insurance

Price matters when you’re shopping for car insurance, but it’s not the only factor you should consider. Cheaper quotes can mean less protection, so it’s important to also consider policy features like coverages, deductibles, policy limits, whether a company has a reliable claims service, and potential discounts.

Considering these factors while you’re choosing insurance helps ensure that you get the full value from the financial protection your car insurance provides. Here’s what you need to know about these factors and some tips for finding the best car insurance coverage for your needs.

What to consider beyond price

The cheapest car insurance policy isn’t always the best value. In fact, low-cost insurance that skimps on protection can cost more in the long run if it results in undesirable trade-offs. 

For example, a higher deductible can save you money on your premium, but you’re now on the hook for paying that deductible in the event of an accident. Lower limits and fewer coverage options can leave expensive coverage gaps. Plus, slower or more difficult claims-handling means that using the protection you pay for can feel like a hassle.

Insurance is one of the best tools for reducing financial risks related to owning and driving a car. Knowing what to look for can help you avoid compromising long-term value for short-term savings.

Coverage options: What the policy actually covers

Always compare coverages before comparing prices. Some low-cost policies only offer your state’s minimum liability coverage, which might not fully protect you against a claim involving a serious injury or fatality. Cheap policies also might exclude the collision and comprehensive coverage you need to repair or replace your car after an accident or other mishap.

Look for these standard coverages in any policy you’re considering:

• Liability coverage (bodily injury and property damage) that meets your state’s minimum requirements

• Collision coverage

• Comprehensive coverage

• Uninsured/underinsured motorist coverage

• Medical payments or personal injury protection

Optional coverages such as rental reimbursement, roadside assistance, and gap insurance offer additional protection.

Policy limits: How much protection you’re getting

Two auto insurance policies can have similar rates but very different coverage limits.

Insurers express liability coverage limits using three numbers separated by slashes (25/50/25 or 100/300/100, for example). 

These numbers show:

• Bodily injury limit per person, in thousands

• Total bodily injury limit per accident, in thousands

• Property damage limit, in thousands

It’s important to note that your insurer will only pay out claims up to your policy limit. If you severely injure someone and their medical bills exceed your limit, you’re responsible for paying the difference. So while it typically meets state-minimum requirements, minimum coverage can leave you with significant out-of-pocket expenses.

As shown in the table below, policies with low limits provide much less coverage than higher-limit policies.

Coverage Type	Low Limit Example	Higher Limit Example
Bodily injury per person	$25,000	$100,000
Bodily injury per accident	$50,000	$300,000
Property damage	$25,000	$100,000

Deductibles: How much you pay out of pocket for repairs

Your insurance deductible is the amount you’re responsible for paying on a collision or comprehensive insurance claim. You can typically choose between deductible amounts of $200, $500, or $1,000.

A lower deductible means the insurer pays more on your claims, so it charges you more for your policy. A higher deductible can lower your premium, but it increases your out-of-pocket costs in the event of an accident.

Consider selecting a deductible you can comfortably afford at the time, and build up a car emergency fund. You can increase your deductible once you’ve got enough savings to cover it. In general, if the amount you’d save over the policy term with a higher deductible is less than the cost of the deductible, it’s not worth increasing.

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Discounts and bundling: Finding opportunities to save

Price still matters, but because discounts vary, it’s a good idea to compare them strategically. Common car insurance discounts include:

• Multi-policy: Save 20% to 25% for insuring multiple vehicles with the same insurer.

• Bundle: Save 10% or more by bundling auto insurance with another policy, like home or renters.

• Telematics: Install a telematics app or device that monitors your driving habits to save 5% to 30% for safe driving.

• Good student: A grade point average (GPA) equivalent of “B” or better can earn you a good student discount of 5%-to-25%.

Insurers with low base rates might offer fewer discounts, so compare quotes after applying discounts for the most accurate estimates.‍ ‍

Claims process and customer service: What happens after an accident

Car insurance matters most when you file a claim. Good claims processing and customer service get you back on the road quickly with minimal frustration and save you from large, out-of-pocket expenses.

One way to learn about companies’ claims handling is with the annual J.D. Power U.S. Auto Claims Satisfaction Study, which ranks more than 20 companies. This is a third-party industry rating, and it can be helpful to see how companies compare to each other.

Trustpilot is another source if you’re looking for direct customer reviews. It has customer reviews for nearly 600 auto insurance companies, plus scores based on those reviews.

Service quality varies between insurers even when their quotes and rates are similar, so be sure to compare companies based on service quality as well as price.

Tips for finding the right coverage for your needs

Your car insurance should be affordable, but you’ll need to look beyond price to find the right coverage for your needs. The following tips will help you select a policy that offers the best combination of value and protection:

• Go beyond minimum limits. Look for enough liability coverage to protect your assets. Your state’s minimum coverage will likely leave you at risk.

• Consider full coverage. Decide whether you could pay out of pocket to repair or replace your car. If not, consider collision and comprehensive coverage.

• Fill coverage gaps. Investigate optional coverages for added protection. If you have a large loan, consider gap insurance. Consider adding roadside assistance to help you in the event of a jump or tow.

• Review a company’s claims reputation. Prioritizing excellent claims handling and customer service can save you money and time later.

• Compare quotes. Always compare after-discount quotes for the same coverages, coverage limits, and deductibles.