Can an Auto Insurance Calculator Help Compare Auto Insurance?

An auto insurance calculator can help compare auto insurance, as long as you are prepared to use one. Being prepared consists of a few things you can do to help ensure your use of a car insurance calculator is accurate and effective.

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You can best prepare yourself for using an auto insurance calculator by being aware of what it does and what it doesn’t do. You can also prepare by having the required information readily available.

What a Car Insurance Calculator Does and Doesn’t Do

A car insurance calculator usually calculates the basic types of insurance you need, but it typically does not give you an estimated cost of the insurance. The latter is the job of an insurance quote, which you can obtain once you know what type of coverage you’re going for.

Some companies may refer to the car insurance calculator under other names, such as a coverage guide. Whatever the name, the tool can usually give you results in a few minutes, whereas a quote may take a bit more time to assess.

The calculator serves as a preliminary step to help guide you in the right direction before receiving a quote.

You may be able to receive a car insurance quote without the use of a car insurance calculator. You may however have to supply the same information you would have had to input into the calculator.

Information Needed to Use an Auto Insurance Calculator

The range of information you need to input in an auto insurance calculator usually varies depending on what calculator you are using. Each company or organization may have its own version of the calculator, although a few basic pieces of information typically remain the same for all of them.

The calculator will usually ask for your age, the age of your vehicle, whether you own, lease, or rent the vehicle, your net worth, and your risk tolerance. Risk tolerance relates back to your deductible, with a high-risk tolerance meaning you would have a higher deductible.

A higher deductible puts you at a higher risk for paying high out-of-pocket expenses for a claim, since you will not be covered until you meet your deductible. A higher deductible, however, also keeps the cost of the premium lower.

In addition to information about your own lifestyle and worth, some calculators may require information about other drivers in your household that will be on the policy. The calculator may also ask specifically about the type of coverage you want.

Basic Car Insurance Coverage Types

Each state has its own set of minimum requirements for certain car insurance types you must carry. Most of them require at least some level of liability coverage, which goes into effect if you are at fault for an accident.

The two types of liability noted by the Illinois Department of Insurance include bodily injury and property damage. Bodily injury (BI) covers the cost of death or injuries for other people in other vehicles and pedestrians. Property damage (PD) covers the cost of damages to other people’s vehicles or property, such as their fences, yard structures, trees as well as utility poles and signs. Each state has its own minimum limit on each type of insurance that all motorists must have.

Some states also require uninsured or underinsured motorist coverage (UM). The latter helps reimburse you if a driver who does not have adequate coverage to pay for the cost of your injuries injures you. The former applies if the driver at fault does not have any insurance at all.

Basic UM typically applies to bodily injuries you may receive. Uninsured/underinsured motorist property damage coverage (UMPD) would apply to damage done to your vehicle or other property in the event of a crash with an uninsured or underinsured driver.

Collision coverage and comprehensive coverage are two types of car insurance that apply to damage your own vehicle.

Collision coverage can kick in to cover damages to your car caused by a collision. Comprehensive coverage would pay for damage to your car caused by something other than a collision. Bad weather, vandalism, theft, and other disasters are prime examples.

Other Types of Car Insurance

Once you move beyond the basic types of coverage, you can add various other options to many policies. These additional types of insurance vary by company. They may not be something you need to think about while using a car insurance calculator, as they can instead come up later when you are ready to receive a quote.

Any addition is going to increase the cost of your policy, although you may find certain options attractive enough to be worth it. Two of the more common types of coverage include towing coverage and rental reimbursement.

Some companies may combine towing with a towing and labor type of coverage that pays for the towing and repairs to your vehicle if you are left stranded. Roadside assistance is another term often used for this type of coverage. Rental reimbursement pays you back the costs incurred for a car rental while yours is being repaired after an accident.

The list extends to include coverage for accidental death, custom equipment, and electronics, gap coverage that pays the amount you still owe on financed or leased vehicles, and medical payment coverage to supplement your bodily injury coverage. Once again, not all companies offer every single option in every single. Companies may also have additional options that go beyond the most common additional types of coverage.

Factors That Go into the Calculator

The most basic car insurance calculators generally stick to the most basic factors. Your age, your vehicle’s age and your net worth may be all the information the calculators need to guide you in the right direction.

If you’re looking for a quote, on the other hand, you may have to input additional information. These often include standard factors companies use to come up with the cost of insurance. Each factor plays a role in determining your rate based on statistics and other information from that category.

For instance, your age is an issue because younger, inexperience drivers statistically have more crashes than older, experienced motorists do. Younger drivers, therefore, would generally have a higher rate than their older counterparts would.

Other Factors for Insurance Rates

The Indiana Department of Insurance points out factors that play a role in your rates that you may not necessarily see on an insurance calculator. They include your marital status, your car use, and type of car you have, where you live, your driving record and claims history, your credit record, and your gender.

Ways to Lower Your Car Insurance Rates

When auto insurance calculators require the very basic information, such as your age and net worth, there is really no way to adjust your information to obtain lower rates. When you get to the quote stage, however, you usually have several ways to keep your rates lower.

One of the top ways to go about it is with discounts, according to USA.gov. Many companies offer an array of discounts that include things like having safety devices, anti-theft devices, a good driving record, and low mileage. Good students, mature drivers and members of the military are often offered discounts, as are those who insure more than one vehicle or have more than one policy type with the same company.

Another way to keep your premiums lower is to make your deductibles higher. This factor is included in some car insurance calculators if the calculator asks about your risk tolerance. As mentioned, a high-risk tolerance will mean higher deductibles and lower rates.

Deciding on Car Insurance without a Car Insurance Calculator

Although a car insurance calculator may be helpful for comparing car insurance quotes, you can still come up with a way to compare without using a calculator. You can also use the information you gleaned from one calculator to request quotes from another organization or company.

Car insurance calculator results offer an estimate on the type of insurance that suits your lifestyle, and you can do the same with your own auto insurance quote worksheet.

The Wisconsin Department of Insurance has an example of a general worksheet in its auto insurance consumer’s guide.

The information you need to provide include your marital status, age, gender, annual mileage, vehicle use, and the status of your vehicle, whether it is owned, leased or rented. Additional information includes:

• The length of your roundtrip to work
• Other drivers in the household
• The type and age of your car

Your driving history comes into play, with the number of violations in the past three years.

The worksheet then indicates to note the basic types of coverage you require and the limits you want on each type. The limits are requested per person and per accident. Although the worksheet may seem like it is requiring a lot of information, the task is easier when you remember states have minimum limits on required insurance and insurance companies offer limit ranges with which you may quickly become familiar when you’re on a hunt for car insurance.

Start your hunt for car insurance quotes today by entering your ZIP in our FREE tool!