Learn how to read an Auto Insurance Quote

In this article  we teach you everything you need to know about an Auto Insurance Quote, we give you real examples AND we give you links to get Real, FREE, auto insurance quotes!

Auto Insurance Quote Basic Definitions:

What is it?

A auto Insurance Quote is an estimate of what you will have to pay for a specific set of Auto insurance Coverage options contained in an Auto Insurance Policy.

You can click on this link to Open our Dictionary of Auto Insurance Terms and Phrases in another window if you need help in understanding some of these Terms.

What does an Auto Insurance Quote Look Like?

Here is a picture of an Actual quote received after filling out a free on line auto insurance quote form:

I explain what each of these fields are in the next paragraph

What does all that stuff in the Auto Insurance Quote Above Mean?

There are three column headings in grey at the top of the form.

1. The first one is "Coverage" Each of the phrases below that heading in blue is a type of insurance coverage that you can buy. The Auto Insurance Quote is an estimate of the cost of a group of Auto insurance coverages. We list the 7 main types of coverages in the next section of this article.
   
2. The second one is "Limits" This defines how much, if any, you are covered for in case of an incident. So if There is a Dollar Amount in a Limit field then that is the limit of the Coverage. If it says "I decline" or 0 it means that you have chosen not to have that coverage.
   
3. The third one is the "Premium" Thats is how much this coverage will cost you. Note that the this could be yearly or monthly or whatever. READ THE PRINT and no what they are telling you!
   

In this quote there is a little down arrow next to each field. It was an online quote and I can click on the down arrow and change the limits of the coverage and it will increase or decrease the cost of that coverage.

For example if I wanted to save money on my Insurance I could click on the  "Collision" coverages down arrow and change the deductible from $500 to $100 and decrease the cost of my insurance by a lot! 

A "Deductible" means that before you get paid for an incident the insurance company deducts the amount of your Deductible from what they will pay you. The higher the deductible, the less they have to pay you for an incident so the less the insurance costs you.

There are Seven Main Coverage Options you can choose from when getting a Quote for an Auto Insurance Policy:

Each of these options "Covers you" or protects you against a specific type of event.

• For example one of the most common coverage options is Liability.
• Liability Coverage is required in most states.
• This coverage pays for accidental bodily injury and property damages to others when you have an accident. Meaning it covers some or all of the costs that might be incurred by other people if you injure them or destroy their property.

Here are the Seven main Options you can choose from:

1. Bodily injury liability coverage pays for damages other people incur if you or someone you allow to drive your auto causes an auto accident. Examples of damages include medical expenses, rehabilitation, funeral costs, settlement of lawsuits, and legal expenses.
2. Property damage liability coverage pays for damage to other people's property if you or someone you let drive your auto causes an auto accident. It usually pays for repair or actual cash value (ACV) of others' property and your legal expenses.
3. Personal injury protection (PIP) coverage pays for medical, rehabilitation, funeral, and childcare expenses as well as for loss of earnings and in-home assistance if you and your passengers are injured in an accident, regardless of who is at fault.
4. Uninsured and underinsured motorist bodily injury coverage pays medical, rehabilitation, and funeral expenses, loss of earnings, and other damages if you or your family are involved in a vehicle, bicycle, or pedestrian accident caused by an uninsured or underinsured motorist or a hit and-run driver.
5. Uninsured motorist property damage coverage pays for damage to your auto caused by an uninsured driver. This optional coverage generally duplicates your collision coverage, but may be a good buy if you have a high deductible on your collision coverage or don't have collision coverage.
6. Collision coverage pays for repairing your vehicle in a collision or rollover.
7. Comprehensive coverage pays for damage to your vehicle resulting from theft, vandalism, windstorms, fire, hail, etc.

 

Where can I get a auto Insurance Quote?"

They are available on line for FREE! You can click on any of the ads on this page for a Free on line quote and get one in minutes!

 

What does each auto insurance coverage Cost?

That depends on how much "risk" there is for the insurance company that you will have an accident. The higher the risk, the more they charge.

The cost for each Insurance Coverage is listed on the Car  Insurance Quote or the actual auto Insurance Policy

BUT BE CAREFUL TO MAKE SURE THAT YOU KNOW HOW MUCH THE POLICY IS GOING TO COST YOU EACH YEAR! Some companies will give you a monthly payment or a quarterly payment (4 payments a year).

I did one that gave me this:

They do this because it makes it look cheap but if you add it all up the total cost of this policy per year is $703.82!

AND it is even more confusing because if I add up the $63.66 plus 5 payments of $63.66 I get $381.96 every 6 months or $763.92 a year so their little Policy pricing gizmo is confusing!

What is Liability Insurance?

There are two basic types of Liability coverage in a auto insurance quote or Policy:

• Bodily injury liability coverage pays for damages other people incur if you or someone you allow to drive your auto causes an auto accident. Examples of damages include medical expenses, rehabilitation, funeral costs, settlement of lawsuits, and legal expenses.
• Property damage liability coverage pays for damage to other people's property if you or someone you let drive your auto causes an auto accident. It usually pays for repair or

How do I know How Much Liability Coverage the quote or policy Has?

If you look at your auto insurance quote or policy  you should see some numbers. For the Injury They might read:

• $25,000/$50,000       or maybe
  
• $50,000/$100,000

In the first example $25,000 is the max the insurance company will pay for each person's medical expenses. The $50,000 is the total amount of money the insurance company will pay per accident in medical expenses.

These are the Limits of the Coverage for that quote or Policy

What If I have an accident and the costs  Exceed Those Limits?

Here is an example lets pretend you get into an accident that is your fault and you have the $25,000/$50,000 liability limit:

• If you hurt 1 person and that persons medical bills are only $10,000. Then your insurance company will pay 100%

HOWEVER

• If you have those same limits and that 1 person's medical expense total $75,000. Then your insurance will only cover $25,000 and leave you to pay the $50,000 by yourself.

What is an Auto or  Auto Insurance Policy?

Here is a link to a FREE Full 10 page Consumers Guide to Auto Insurance.  This example is from the Government of the State of Washington. So some of the specifics for Washington may not be the same as your state.

• if you really want to learn EVERYTHING about an auto insurance policy then click on this link. It is easy to read and understand.
• Other wise you can read the rest of this web page.

The insurance policy  is a contract between you and an insurance company.

It spells out exactly what the company agrees to do for you in exchange for the premium that you pay (the amount of money you pay them for the auto insurance).

When you buy auto insurance, you are buying a set of auto insurance coverage options all grouped together in what is called a Policy.

• Your policy is based on a variety of factors including what kind of auto you drive as well as what kind of insurance you want. Auto insurance policies are actually a package of different types of insurance coverage.

How Long is a On Line auto Insurance Quote good for?

Most places will tell you this when you get the quote. It will be written on the web page. Generally, most auto insurance quotes issued online will be good for between 48 and 72 hours from the time you receive the quote. However, some insurers may extend this period for much longer in order to entice you to come back and buy.

Are On Line auto Insurance Quotes Binding (a guaranteed price)?

Regardless of how long the auto insurance quote is good for, or what the website states, it is important to remember that a quote is not a guarantee that you will be charged the quoted rate. When your policy is written, insurers may uncover new information that alters your price. The final quoted rate you get immediately before signing your policy or purchasing your insurance only becomes binding once you sign the papers and buy the insurance. Any quotes are therefore just estimates.

IMPORTANT – get a printed copy of the on line auto insurance quote before you pay for it!

1. No matter what the website said or what someone told you on the phone, the coverage you get for your money – how much of a claim they will pay for and how much is your responsibility – is what the Policy says. That is the contract!
2. So when you receive a auto insurance quote, you should print out the details of the quote and policy. If an agent issues the quote, get him to put everything in writing.
3. Then when you get the actual policy in the mail you can compare it (The Declaration page of the Policy) to what you printed out – what you were offered and what you paid for. 
4. Generally, a large change in a quoted policy or premium does not occur unless something changes significantly in your situation, such as a change in your driving record. If the change is minor and you have a print out of your original quote, must insurance companies will honor that original quote in order to get your business.

What is The declarations page of the auto Insurance Policy?
This section of the policy includes basic details of the agreement.

It is important that you review this page to make sure all the information is correct and all the coverages you requested are included. The declarations page includes:

• Name of the insurance company
• Name(s) of the policyholder(s)
• Policy number
• Policy period
• Description of the vehicle(s) insured
• Coverages purchased
• Limits of liability and deductibles purchased
• Premium charge for each coverage
• List of forms that are a part of the policy

Is auto insurance Required?

Forty-seven states require that you have at least some kind of auto insurance, so it's a good idea to know what the law requires you to have and what additional or optional coverage will help to protect you in the event of an accident.

• You can click on this link to get our list of the phone numbers for the Auto Insurance Department of every US state.
• If you do not know what the law is in your state for the minimum amount of auto insurance you have to have you can call your states Auto Insurance department to find out!

A little more about Required Coverages

The required Auto insurance coverage differs from state to state and each state may change the law over time.

Here  is an example of the current (as of 01/11/2002) Oregon Requirements for Auto insurance coverage:

Oregon law requires every vehicle to be covered by auto insurance. Nevertheless, millions of dollars in damage is caused each year by uninsured drivers. This includes damage to vehicles and medical care for those injured in accidents.

Oregon's mandatory-insurance law requires that drivers have at least these coverages:

• Bodily injury (BI) liability
  $25,000 per person, $50,000 per accident for bodily injury to others.

• Property damage (PD) liability
  $20,000 per accident for damage to the property of others.

• Personal injury protection (PIP)
  PIP is Oregon's version of no-fault insurance. It allows you and your passengers, regardless of who caused an accident, to have insurance coverage for "reasonable and necessary" medical, dental, hospital, surgical, ambulance, and prosthetic services incurred within one year after the date of an injury up to a maximum of $15,000. In Oregon, minimum PIP benefits include limited coverage for loss of earnings, funeral expenses, essential services, and child care.

  Medical services: Treatment is considered reasonable and necessary unless a provider receives a denial notice within 60 calendar days of claim notice. After that, the burden of proving that treatment was not reasonable and necessary is on the insurance company.

  Loss of earnings: This benefit is available if your injury prevents you from returning to work. It begins on the 14th day of your disability. You receive up to 70 percent of wages up to a maximum benefit of $3,000 a month for 52 weeks.

  Essential services: If you are not employed, you are entitled to reimbursement of reasonably incurred expenses for the essential services that you would normally perform. You will receive up to $30 a day for up to 52 weeks. This benefit begins on the 14th day of disability.

  Funeral expenses: You will be paid for reasonable and necessary funeral expenses within one year of the date of injury up to a maximum benefit of $5,000. Oregon law and your insurance policy allow PIP benefit disputes to be resolved by arbitration as long as both parties agree at the time of the dispute. Know your PIP limit. Review this coverage carefully and consider raising your limit.

• Uninsured motorist bodily injury (UMBI) and underinsured motorist (UIM) coverage
  $25,000 per person, $50,000 per accident for bodily injury to you and your passengers caused by an uninsured or underinsured driver. UMBI and UIM coverage require your insurance company to pay all expenses that would normally be paid by the other person's company if you are hurt by an uninsured or underinsured motorist. Consider increasing this coverage on your policy, because an uninsured or underinsured motorist probably cannot compensate you for your losses.

You can click on this link to read an article on What Auto Insurance Coverage Do I need for more information!

OK that is it for this What is an Auto Insurance Quote Article!