Receiving a letter in the mail from your insurance company is rarely a pleasant experience. Those letters often contain unexpected and unwanted information, such as a message that your premiums are going up. If you’re the unwitting recipient of one of those rate hike letters, you may want to use this unpleasant news as an excuse to shop for better coverage at a more affordable price.
The reasons auto insurance companies increase their rates are many, and often those rate increases have nothing to do with you personally. You can have a clean driving record and no claims history and still fall victim to a company-wide rate hike. If you are, in fact, a good driver with no history of damage, you have even more reason to look for a better deal. It could just be that your current auto insurance company isn’t very good at managing money and determining risk, and if it is, you probably don’t want to continue working with them anyway.
Gather your information
If you do receive a letter stating that your rates are going up, read that letter carefully to determine when exactly that interest rate increase will take effect. Chances are, your premiums won’t go up until your next coverage period starts, so you may have a few weeks or even a few months before you start seeing those higher premiums draining your cash flow.
Your next step should be to find a copy of your most recent insurance policy. You must have the actual policy, not just the insurance card. You need the information from the insurance policy detail pages to determine your current coverage level. You should see a page listing every type of coverage you have for yourself and your vehicles, including collision and comprehensive coverage, property damage and liability, and coverage for uninsured and underinsured drivers. Write down the levels of each type of coverage, as well as the deductible for each coverage. You can use these levels of coverage as you shop for new and more affordable auto insurance.
Once you’ve gathered as much information as possible about your current policy, your next step is to find a quality online auto insurance comparison tool. There are many of these tools available and they work by letting you enter your information and then send that data to all the auto insurers they work with. These online tools can be a great way to collect multiple quotes for the coverage you need.
After you’ve found a suitable online comparison tool, fill in all the information from your current policy, including the coverage limits for each type of insurance. Please review these postings carefully before submitting the information as an error in those coverage levels could result in the quotes you receive being inaccurate. After submitting your information, you should receive quotes from several insurance companies, and you can use that information to find the best coverage at the lowest possible price.