And where do I get the lambs?

August 1, 2006 8:43 AM

Auto Insurance: What?

I'm going to be buying my first car. I have no idea how to start looking for auto insurance. I live in Maryland. The car's going to be a borderline junker (used car, bought for no more than $2,000-$3,000) and I'm a college student, so whatever coverage I get will be the bare minimum.

How do I go about finding the lowest insurance? I know car types influence their decision. Sports cars are right out, red cars are supposedly bad, Hondas are easily stolen, older cars get more expensive quotes. You can improve your insurance by modifying your car so it's harder to steal. Then you have to pick the best deal from a company--GEICO or Allstate? Random mom 'n' pop operation (do these exist)? How do I balance cost of insurance versus cost of car versus cost of modifications to maximize cost-benefit? How many pure-white lambs should I sacrifice to the insurance gods to get a good deal, and is it OK for me to wear a loincloth to the midnight ceremonies or do I really have to be stark naked?

posted by schroedinger to travel & transportation (22 answers total)

We just bought a used car recently (though a newer one. not a junker), and we already had insurance on another car, so it wasn't difficult for us. But I would recommend simply calling up a bunch of insurance companies. There probably will be some that are more local to your area, but call the big ones first. We have Amica, mostly because my parents have been with them since the 70's, and they've always been happy. Not going to be the cheapest of the cheap, but definitely decent. There are various factors that affect your rate (even you...age, driving record, etc). When you get your rate quote, simply ask them if there's anything you can do to lower that quote. Most places should be able to give you your quote right away on the phone after they grill you.
posted by theantikitty at 8:54 AM on August 1, 2006

I used Progressive all the way through college on both motorcycles and cars because they were the cheapest for my driving record, which had a couple of speeding tickets on it. But now, with all of the discounts that I get with State Farm, State Farm actually became cheaper than even GEICO.

Do shop around. You can be surprised by what you find.
posted by SpecialK at 8:59 AM on August 1, 2006

Oh, and it's likely that a sit-down with an agent (State Farm is great about this) can answer all of the rest of your questions about what minimums are and what the ramifications of each coverage will be.

I'd suggest making sure you get some towing coverage. It becomes invaluable when your car/motorcycle breaks down somewhere. :-P
posted by SpecialK at 9:00 AM on August 1, 2006

Insurance.com
posted by blue_beetle at 9:04 AM on August 1, 2006

You can get towing coverage through AAA. The membership shouldn't cost you more than $50-60 a year, and you'll be able to call any time for a tow, a jump, or any other potential emergency. Plus, you get free maps.

For insurance, I'd go with liability only. Low deductible collision will likely be unnecessarily expensive, and with a high deductible plan, your out-of-pocket responsibility in a serious accident will probably be more than the cost of the car. Get the bare minimum and try to stay out of trouble so that when you eventually have a nicer car, your rates for better coverage will be lower.
posted by Amy Phillips at 9:09 AM on August 1, 2006

I have an insurance agent that handles multiple types of insurance and will check quotes from multiple companies for me if I request them. You might want to check for a local agent who could provide such a service since it makes shopping around easier.
posted by mikeh at 9:15 AM on August 1, 2006

My 2005 Honda Accord EX was dirt cheap to insure - so I don't know about this "easy to steal, expensive to insure" business.

Just shop around - call different places. I have a great driving record, great credit, and great rates through Hartford Auto insurance. A quote from Progressive was LITERALLY DOUBLE what I pay now. Why? Who knows? My friends had the opposite experience. There's no telling.
posted by peep at 9:15 AM on August 1, 2006

Correct me if I'm wrong, but most insurance companies will force you to have the minimum COMPREHENSIVE insurance if you owe money on the car, rather than JUST liability. If you're only spending $2000 on a car, and don't want comprehensive, I'd save enough money to buy the car with cash/credit, rather than getting it financed. You'll end up saving several hundred dollars a year.
posted by hatsix at 9:15 AM on August 1, 2006

Don't learn the hard way: Paying slightly more for insurance that provides you with an agent and a local office will save you some huge hassles if you ever need it. Cheap insurance means they expect you to do all the necessary legwork if you get into an accident. If you can afford it, go with an actual agent rather than an internet or phone-only insurance company.

My grandpa was a State Farm agent for 30 years. I've never been treated badly by the company - but don't take my word for it. Pick a company you trust, and meet with the agent first before you decide to buy from him or her. If the company you choose has more than one agent in your area, don't be afraid to shop around for an agent that you feel will treat you like a grown-up person and not like the broke student you are.
posted by caution live frogs at 9:17 AM on August 1, 2006

I've had State Farms, Nationwide, and Erie Auto Insurance. I've gotten quotes from Allstate and Geico. Erie has been, by far, the cheapest. Progressive is a second tier insurance provider and (from what I've heard) cannot be trusted as much as the above mentioned.

Just get some quotes and pick the cheapest. For a beater car, I would suggest very, very high deductables (if you even bother with collision/comprehensive, which I wouldn't if I were you), basic liability (15/30 all the way), and none of the frills. That will keep your costs down while keeping you legal.

They all check your credit records, BTW, and I know for a fact that Geico hikes your rates if your credit score isn't great. In addition, Erie, Nationwide, and State Farms all go back three years, while Geico goes back 5. That might play into the equation as well. Good luck.
posted by SeizeTheDay at 9:21 AM on August 1, 2006

It could be that American insurance is very different from Canadian, but I'd say given your questions the best approach is to talk to an insurance agent.

Agents generally represent a number (but not all) insurance companies, so they'll be able to look at your profile, make suggestions on how to improve your situation, get you quotes from three or four insurance companies, and then follow up with those companies whenever there are problems.

Yes, you can save some money by going direct, but only if you can find the right company to go direct with.
posted by mendel at 9:37 AM on August 1, 2006

I second the advice to shop around. I personally use Progressive and have found it to be substantially cheaper (by about $600/yr) for my 2004 Scion xA. My driving record is spotless but I took an online driver's safery course for $29.99 that will save me $24.95 on my insurance every 6 months for the next 3 years. Also, Progressive is one of the few insurance companies that offered a $2,000 deductible (most others just had $1000 or less), which helped to keep the monthly cost down.
posted by mezzanayne at 9:54 AM on August 1, 2006

Dittos to mezzanayne on the defensive driving course. We're saving $240/year just by taking an in-person 6.5-hour defensive driving course for $16 each (including lunch!), and the discount is good for the next three years. Ask what discounts the insurance company offers.
posted by davcoo at 10:09 AM on August 1, 2006

A friend of mine recently shared 10 expert tips for saving on car insurance. She works in the industry. These aren't tips like "don't buy a red car", and they're not recommendations for specific companies. They're more tips on specific tactics you can use to save on insurance no matter what car you buy, things like "self insure as much as possible" (meaning take the highest deductible you can afford). (It also means, contrary to SpecialK's recommendation, that you don't get towing insurance.)

Also, are you sure that older cars are more exensive to insure? That seems very counterintuitive.
posted by jdroth at 10:28 AM on August 1, 2006

Fuck State Farm in the ear with a broken pool queue. My wife (then pregnant) was rear-ended by some steakhead in his Camaro. State Farm went out of their way to avoid paying for ANYTHING. It was surreal having to deal with those idiots and it's not the first horror story but the one that really hits home.

Second CautionLiveFrogs advice. We went with Allstate and haven't looked back.
posted by KevinSkomsvold at 10:50 AM on August 1, 2006

For figuring out how your choice of car will affect insurance premiums and other costs, the Edmunds True Cost to Own estimates are good for rough comparisons.
posted by mbrubeck at 10:55 AM on August 1, 2006

Don't just shop for rates. Also ask what the procedure is in case your car is damaged.
As has been mentioned, some insurers make you do all the legwork. Others, will send adjusters out to you.
Some insurance companies allow you to shop for repair quotes. Others insist you run the wreck through their "approved" collision centers and you take whatever their adjuster decides.
posted by Thorzdad at 10:56 AM on August 1, 2006

Second CautionLiveFrogs advice. We went with Allstate and haven't looked back.

Specifically, this advice: Paying slightly more for insurance that provides you with an agent and a local office will save you some huge hassles if you ever need it. Cheap insurance means they expect you to do all the necessary legwork if you get into an accident.
posted by KevinSkomsvold at 11:06 AM on August 1, 2006

Do your parents/friends have car insurance? Do you have renter's insurance? Exploit those contacts as much as possible. When I rented my first place, I got my renter's insurance through the agent a friend used for her homeowner's insurance and I got a $200 credit on my first payment (they were annual) and she got a $200 credit on her next payment as well. Try and see if friends or relatives have longstanding relationships with insurers. It doesn't always work - when I insured my brand-new Honda, I ended up with cheaper insurance from Progressive than from Liberty Mutual, the company my parents used to insure their cars and home for more than 30 years.

It is worth the effort, though.
posted by MeetMegan at 11:08 AM on August 1, 2006

Ok, here we go. Broken into paragraphs for ease of reading.

Hondas are not easily stolen, it's just that late model Hondas are popular theft targets because they can be torn down for parts. If you are looking to spend < $3000, you can't afford a honda new enough to be a theft target.br>
Chances are your insurance company won't even know what color your car is. A red car will make you stand out in traffic (ever wonder why fire trucks are red? it isn't to color coordinate with the fire). So theoretically you avoid wrecks, but you also theoretically catch the eyes of cops out to meet a ticket quota.

Old/new is a balancing act from an insurance cost standpoint. Older cars are worth less money, which reduces rates. However, newer cars have more safety features (anti-lock brakes, more modern airbags, etc).

If you finance the car, the minimum insurance you will be required to have goes up. This is to protect your lender's investment, not you.

Call around. Don't use a company you have never heard of. Ask friends and family. If you can meet an agent personally, that's not a bad thing. Since you are a college student, he will see it as an opportunity to be Your Agent For Life, and thus be happy to talk to you. But when he wants to talk about life insurance, tell him to wait until you have are out of school and have a Real Job. (and then remember that Life Insurance Is Not An Investment because you have to DIE to collect.) Independent insurance brokers do exist, but most of them deal with corporate accounts (health insurance, umbrella polcies, malpractice, etc.). If you know of one that does consumer level insurance they are worth talking to because they deal with more than one company. Instant rate comparison!

If you have more than about $1000 worth of stuff, talk to him about renters insurance while you are there. Can afford to replace everything you own for the premium he quotes you? No? Then get it.

As for myself, I have been happy with Allstate. Because I have my homeowners insurance with them, they discount all my policies. My Allstate guy also refered me to the broker that handles my company's health insurance.
posted by ilsa at 11:48 AM on August 1, 2006

I have my homeowners and car with State Farm, it was the least expensive for the coverage I wanted, but also the agent is very nice and easy to work with.

I would like to say though, people make mistakes, you may hit someone and you don't want to be sued, so get as much liability as you can.
posted by stormygrey at 11:56 AM on August 1, 2006

I recently bought my first car, and I shopped around for quotes. Some insurance companies(21st century) quoted almost double of what I pay now from Ameriprise. All other companies', including Geico's, rate was atleast 10-20% higher than my current preminum. So my suggestion is decide what you want and shop around for quotes. Then go for the lowest price. Don't hesitate to call them and state that you are shopping around for quotes, and ask if there's some way you can help to lower yr insurance. Also, there are some safe driving courses, and if you've taken them it lowers yr rates (tho, I've no idea by how much).
posted by forwebsites at 2:39 PM on August 1, 2006