Const & Coverage
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When you’re fluent in reading an auto insurance quote, you’ll know exactly how much coverage you’ll get, and how much it’ll cost you.
If you drive, you already know that it’s usually a smart idea to have some kind of auto insurance to back you up in the event of some vehicular mishap – especially because it’s illegal to drive without insurance. It’s an even smarter idea to set an annual reminder to look for a new insurance policy and compare your options, since you could always stand to save more money.
So why do many motorists sputter and stall when looking for car insurance? Collision and comprehensive. Liability and PIP. Deductible and premium. And those three numbers at the top of the page -- just what do they mean?
Letting some of those complexities get in the way can deter you from finding the best and most affordable policy for your needs. But when you’re fluent in reading an auto insurance quote, you’ll know exactly how much coverage you’ll get, and how much it’ll cost you, taking the guesswork out of finding a better insurance package.
Before you get behind the wheel, here’s how to get behind the wheel of understanding your auto insurance quote:
A car insurance quote is the estimated amount your car insurance will cost and what goes into that amount. The quote factors in a number of variables:
Once your policy is finalized, your quote becomes your premium, which you have to pay periodically to keep your policy in force.
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The main page of your insurance quote is the policy declarations page, or "deck." It’ll list, or declare, all the policy details you’ve been quoted. Somewhere at the top of the page, you may see a series of three numbers that look something like this:
This trio of numbers summarizes the total dollar amounts (expressed in thousands) of coverage in your policy in the event of a car accident with damage or injuries:
These are the total primary coverage limit amounts you’d be covered for. So, if you were involved in an accident and you were injured as the sole occupant of the vehicle, your insurance company would pay out up to $50,000 to cover your medical expenses.
Keep in mind that every state that requires you to have car insurance also requires you to have a minimum amount of coverage in those areas. You can raise or lower the amount of coverage you purchase in each area based on your own coverage needs, but you’ll always need at least the state minimum.
Elsewhere on the deck page you’ll find other basic details, like:
Some terms may look familiar, some may not, but understanding all of them will clarify your quote:
You have the option to purchase as much insurance in each of the various components of car insurance coverage. Although there are state minimums for some areas of coverage, like liability and personal injury protection, other components are entirely optional. Knowing how much coverage you need in each type can save you money both in the premiums you pay for a given amount of coverage and when you’re in a car accident and liable for damages.
Liability insurance is the coverage that pays for damages and injuries that you cause in an accident. Denoted as the set of three numbers on your declarations page we listed above, liability can pay for motorist medical expenses, loss of earnings, vehicular damage, legal fees, and even funeral expenses. Minimum coverage requirements vary from state to state.
Collision coverage pays to fix your car if you’re involved in a crash with another vehicle or object where no other parties are involved. (Yes, even self-inflicted accidents are covered under auto insurance.) Collision deductibles range on average from $250 to $1,000.
Comprehensive coverage doesn’t pay for collision- or accident-related damages. But it will pay for damages caused by weather, fire, flooding, natural disasters, theft, or coming into contact with an animal crossing the road.
There’s technically no such thing as "full coverage" auto insurance, but it’s a term that used to refer to policies that include a mix of collision and comprehensive coverages. Since it’s a bit more inclusive of coverage, you may expect your rates to be higher than what it might cost to buy each coverage separately. In Ohio, for example, full coverage auto insurance raises rates by $362 per year on average, and in New Jersey, full coverage increases rates by $606.
Guaranteed auto protection (GAP) insurance a sort of auxiliary protection to collision coverage that covers the difference – the “gap” – between the amount you still owe on your car payments and the actual value of the car if it’s totaled in a crash or stolen. Check with your auto lender to see if GAP coverage is already included as part of your loan terms.
Personal injury protection, or PIP, insurance coverage pays for medical and injury treatment expenses for both you or your passengers no matter who was at fault in the incident.
Not everyone on the road is insured; according to the Insurance Research Council, about one in eight people drive without auto insurance. Uninsured motorist coverage protects you against damages caused by another driver who has no insurance, or not enough insurance, to pay for your bodily injury or repairs to your vehicle.
Additionally, when shopping for car insurance, inquire how much it’ll cost to obtain roadside assistance or car rental coverage. Having both options on your policy can ensure that you won’t need to pay for your vehicle to be towed, or to rent a car while yours is in the shop (being paid for by your insurance carrier, no less).
Several different factors go into determining your individual insurance rates:
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Yes, we have to include some legalese down here. Read it larger on our legal page. Policygenius Inc. (“Policygenius”) is a licensed independent insurance broker. Policygenius does not underwrite any insurance policy described on this website. The information provided on this site has been developed by Policygenius for general informational and educational purposes. We do our best efforts to ensure that this information is up-to-date and accurate. Any insurance policy premium quotes or ranges displayed are non-binding. The final insurance policy premium for any policy is determined by the underwriting insurance company following application. Savings are estimated by comparing the highest and lowest price for a shopper in a given health class. For example: for a 30-year old non-smoker male in South Carolina with excellent health and a preferred plus health class, comparing quotes for a $500,000, 20-year term life policy, the price difference between the lowest and highest quotes is 60%. For that same shopper in New York, the price difference is 40%. Rates are subject to change and are valid as of 2/17/17.
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