What to Look for When Buying Car Insurance

Buying car insurance doesn't have to be difficult. But, navigating your way from initial approach to signing on the dotted line can be a journey often fraught with red flags and subtle nuances you'd be smart to pay close attention to. Here are a few best practices to follow when you're shopping for car insurance.

As you progress toward closing the deal with the insurance provider of your choice, keep an eye open for some of the following key indicators that could predict an unsatisfactory outcome.

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A high rate of consumer complaints.

Before buying car insurance, your first step should be to research that company's customer satisfaction rating. You can learn about their customer satisfaction ratings, from talking to friends, family and past customers or going online and reading discussion forums or reviews on reputable sites. If you find more horror stories than happy endings, you may want to check out a different insurance company.

A surprising lack of information about the insurance company online.

True, not all insurance companies exist in cyberspace. Even some that do have one foot in the brick-and-mortar world and another foot in the online world aren't always as visible as others. But, if your searches discover little to no information, you may want to rethink your choice and seek out a different insurance provider.

The insurer stresses price value over quality of insurance.

Not everyone goes looking for cheap insurance, but the issue of price can be one of the major determining factors in your decision. If so, this should be your decision, not the insurance company's. If what you're hearing from the insurance company has more to do with price points than quality coverage, get a copy of the terms of coverage and go through them cautiously. More often than not, the devil is in the details.

No displayed willingness on the part of the provider to send you a hard copy of the insurance terms or a written quote.

In short, you should think twice about doing business with any insurance company that claims it cannot or outright refuses to send you a copy of the terms of coverage. Likewise, don't take any price quotes verbally —always get everything in writing. A legitimate quote and terms should be on an official company letterhead.

The insurance company has a low credit rating with A.M. Best.

A.M. Best is an independent firm that reviews and publishes credit ratings for insurance companies. Using this information, you can get a good idea of the financial strength of the insurer you're considering. One of the reasons this is so critically important is that poor financial ratings could lead to closure and bankruptcy. If this happens, any claims that are in the process of being resolved could be delayed. In a worst-case scenario, they may fall through, and you could be left with no payout and no coverage.

No discounts offered.

One of the staples of high-caliber auto insurance companies is shown in the customer's ability to earn discounts based on excellent driving records or having various policies with the same company. If you're not offered these kinds of discounts, ask about them. If they're still not offered, keep searching.

The insurance company is rushing you to sign for coverage or emphasizing "limited-time offer" conditions.

Buying car insurance should be a carefully thought-out process that gives you plenty of time to consider your alternatives. Nowhere in that process should there be any aggressive coaxing or urging you to sign for coverage immediately. If dealing with an insurance company is making you feel like you're dealing with a pushy car salesman, it may be time to pick up and move on to the next insurance company on your short list.

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Published: September 2012

Coverage subject to terms, conditions and availability. Policy issuance is subject to qualifications. Allstate Property and Casualty Insurance Company, Allstate Fire and Casualty Insurance Company, Allstate Indemnity Company, Allstate New Jersey Property and Casualty Insurance Company. © 2013 Allstate Insurance Company, Northbrook, IL.

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