Jessica Sautter is a Content Writer for CarInsuranceCompanies.com with a Bachelor’s Degree from Eastern Michigan University in Elementary Education with a Major in Reading and a Minor in Mathematics.

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Chris Harrigan has an economic degree from Limestone College and an MBA from Clemson University. He previously managed auto insurance claims for Enterprise Rent-A-Car. Currently, he is using his business and insurance expertise to provide insurance data analysis and visualizations to enhance the user experience.

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Reviewed by Chris Harrigan
Former Auto Insurance Claims Manager

UPDATED: Sep 14, 2020

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Key takeaways...

  • A car insurance premium is only one part of the car insurance policy equation
  • There are also several other factors that can affect your car insurance premium
  • Either way, the state mimimum requirement for coverage usually doesn’t protect you that much
  • Supplemental coverage is something you might want to look into

Car insurance can be cheap, but much like buying a cheap pair of shoes, you usually end up with a product of far lower quality than expected.

When consumers hear the words cheap car insurance, it’s normal to think about car insurance premiums. However, premiums are just one part of the equation in a car insurance policy.

When you own a vehicle, you will be required to obtain liability insurance coverage. Keep in mind though that this type of car insurance doesn’t provide coverage for damage to your vehicle and/or injuries sustained by you in the event of an accident.

Cheap car insurance policies often provide only state minimum requirements, which are usually much less than you need.

Want to compare car insurance rates online? Enter your ZIP code above to find better and more affordable car insurance today!

Table of Contents

How can you buy cheap car insurance?

Cheap is a relative term, and car insurance premiums are based on several factors including:

  • Deductibles
  • Types of coverage
  • Policy limits, etc.

It’s very easy for car insurance companies to calculate extremely low premiums and advertise these policies as cheap car insurance.

There really is nothing wrong with calculating premiums this way.

However, car insurance is a topic we learn very little about until it’s too late (when you need to make a claim), and not having the appropriate coverage in place can expose you to financial hardship.

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Compare cheap car insurance to cheap airfares.

Ever see ads which advertise incredibly cheap airfares? But when you dig a little deeper, you realize you can only fly at 6 am on the second Saturday of a month and must stay for 45 days.

In reality, very few people can ever take advantage of these cheap airfares published, but they are available – just with restrictions which make it almost impossible to take advantage of.

The difference with car insurance, however, is how great your personal liability can be in an accident and how even a small accident can bankrupt a family without having car insurance coverage in place.

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What should I look for in a car insurance policy?

As far as minimum requirements go, you will need to comply with your state auto insurance requirements to avoid fines and/or possible suspension of your vehicle registration.

Almost all financial expert, though, recommend maintaining at least $100,000 or more in liability insurance.

Note that many states have only $5,000 to $10,000 as a requirement which is almost equal to having no insurance. You may also want to consider other types of coverage including:

Once you define how much coverage you need (and the types of coverage), then it’s time to approach auto insurance companies and look for the best rates, comparing all elements of propose policies equally.

Ready to compare quotes? Need to learn more about car insurance before starting your car insurance comparison search? Visit our auto insurance guide here.

Better yet, find better and more affordable car insurance by entering your ZIP code below. Start comparison shopping today!

References:

  1. https://www.investopedia.com/terms/a/automobile-liability-insurance.asp
  2. https://www.moneycrashers.com/factors-affect-car-insurance-rates/
  3. https://www.thebalance.com/filing-auto-insurance-claim-2645925
  4. https://www.nytimes.com/2012/08/25/your-money/auto-insurance/how-to-know-if-you-have-enough-auto-insurance.html
  5. https://ankinlaw.com/financial-effects-of-auto-accident/
  6. https://www.thebalance.com/comprehensive-insurance-coverage-2645753
  7. https://www.investopedia.com/terms/c/collision-insurance.asp
  8. https://www.iii.org/article/what-gap-insurance