Understanding car insurance quotes

Understanding Car Insurance Quotes

If you have been in the market shopping for car insurance, you likely have seen how challenging reading insurance quotes can be. There is a lot included, and the multiple pages probably leave you scratching your head. That’s okay; we’re here to help. Below are the key components of car insurance quotes so you can make an informed decision on your next policy.

Car insurance terms demystified

As you read through your car insurance quote, you will likely find several terms that may seem “insurance-y.” These may include:

Deductible: The deductible is the amount you will have to pay out of pocket before your elected coverage kicks in after you file a claim. Typically a higher deductible means you will pay a lower premium.

Effective date: The effective dates are when your policy officially covers you. You will see policy start date to end date listed.

Policy: Your policy is the contract between you and your insurance company that outlines what your car insurance coverage includes. This will be your elected coverages, policy limits, and deductibles. Your policy will also state your official annual or bi-annual premium. 

Policy term: The policy term is the length of time the insurance policy is valid. Auto insurance policies typically have coverage terms of 6 or 12 months.

Coverage levels

Here is an overview of the various coverages that may be included in your policy quote:

Liability: Covers medical bills, legal settlements, and repairs that are the result of injuries or damage that you as the driver causes to someone or their property. 

Collision: Covers any damage to your car resulting from a collision with another vehicle or object.

Comprehensive: Covers damage to your vehicle that is caused by theft or something other than a collision.  

Personal Injury Protection (PIP): Covers medical treatment needed by you and any passengers in the vehicle that were injured during an auto accident. 

Uninsured and Underinsured Motorist Coverage: Covers damages if you are hit by a driver who is uninsured or underinsured. 

Declarations page

The amount of insurance language continues after you buy auto insurance. One page you want to double check is the declarations page, which offers an overview of your details, including your elected coverages. Be aware this “page” could be multiple pages long, depending upon the number of vehicles and drivers on your policy. Verify the following items are accurate when you receive your car insurance policy to avoid any unpaid claims: 

  • Your info – name, address, email, and policy number
  • Coverage period – the length and effective dates of your policy term
  • Vehicles included on your policy – make, model, VIN, and financing info (if applicable)
  • Drivers covered by your policy – additional or excluded drivers
  • Specific coverages – a list of coverages, limits, deductibles, and the premium for each coverage
  • Premium – your total premium
​​​​​​​Helpful advice

When you make a change to your policy, your insurance agent should send you a new declarations page. Such instances would include adding or removing a vehicle or driver from your policy. If a new declarations page does not arrive within a week, reach out to your insurance company:

  • Verify that policy changes were made
  • Request they mail you a new declarations page for your records
This should also be done with every policy renewal. You must review your policy often to ensure it is accurate and contains the coverages you want. Ensuring accuracy will eliminate any surprises during the unfortunate event of having to use your policy.