Searching For the Right Car Insurance

Summer is in full swing as we head towards the end of July, and while that does bring about vacations and nice weather for me it also brings about the dreaded time period where my car insurance needs to be renewed again. You are probably thinking that searching for and paying for car insurance shouldn’t be this bad, right? Well that’s where you would be wrong – well sort of. I’m currently living in what is probably one of the most expensive areas for car insurance in the United States, or at least is consistently ranked near the top 10. I know that Michigan is often listed as the most expensive car insurance state, but this largely because the rates inside of Detroit are so high. If you are living outside of Detroit you will most likely not see rates that are high, but here in the Northeast you will see the high rates everywhere, even outside of cities (like me!). Add in the fact that I’m a male not yet over the age of 25 and this compounds the problem even more, as we see some of the highest car insurance rates just because our demographic tends to also be the riskiest to insure as well.

My car is now 10 years old, but it still has low mileage for its age as it just hit 80,000 miles but you would think that it would also not be that expensive to insure at this point in time. A lot of websites will value my car at around $3,500 when selling to a private party and obviously less than that when trading into a dealer. This car is not a Honda Civic, Toyota Corolla, etc that has a reputation for lasting forever so the value doesn’t hold very well and in fact it is an American made car which also contributes to the lower re-sale value as a sedan.

When looking at pricing on craigslist for my model year car, most of them have 100,000-120,000 miles on them and the seller is asking anywhere from $2,000-$4,000 so this seems to be accurate. Luckily I haven’t had any major problems with my car and it has been extremely reliable ever since I bought it, which I’m hoping continues well over 100,000 miles.

The reason I gave you the details about my car is because I was considering dropping my collision coverage in order to save more money, but I think I have decided against that for this year. I think my car is in excellent shape and I could definitely get the $4,000 for it if someone came to look at my car in person and was looking to buy. I’m only the second owner and I’m not a rough driver as I try to accelerate slowly and come to a stop slowly when possible, not like I’m out there redlining the car or anything. I do have the money in my emergency fund but the savings aren’t that significant this year for dropping collision coverage that I think I will wait until next year to do that. I know that insurance companies just use a valuation tool when assessing so I will probably get lower than I want if that happened, but I’m OK with that for now.

The only problem is that my insurance quote from my current company has only gone down ever so slightly, and it will cost $1400 to insure my car for the year which I think is absolutely ridiculous. My insurance actually went up slightly last year and now is back near the rates I was paying the year before. And that’s with no accidents, tickets, or any sort of claims as I get older and have more driving experience.

The only problem with that is that my parents and everyone I talk to love this insurance company and say just how great they are when you actually have to file a claim. Everyone says how lucky I am that my company (my Dad’s company offers this as well) offers this insurance company. It is a local company specific to my area, and they don’t spend any money on advertising and give you back a dividend each year as well. But if all that is true, why is my insurance so high? The great reputation and how everyone raves about them makes me hesitant to move on to a company like Geico where you are most likely just a number.

I did go online to get a few more insurance quotes from some national insurance providers, but the most they saved me was $200 for the year if paid in full 2x a year (as most give 6 month quotes, so I had to double that to come up with the estimates) and some really only would have saved me around $50. I actually choose decently high deductibles at $750 for collision and comprehensive, but on most of the coverage parts and liability parts I take the maximum amounts as I don’t want some going after me individually if something tragic did happen.

I take the $100,000/$300,000 coverage for bodily injury liability and then the $25,000 for the property damage part. That’s what insurance is for after all, isn’t it? I’m not so much worried about my car as that can always be replaced but any injury to myself or others is the expensive and important part here. I want to make sure that I am fully covered in that situation and don’t want to regret being cheap just to save a few dollars in a month in that area.

What do you think I should do? Should I switch to a more national insurance company to save a few hundred dollars and risk what could be less friendly claims handling should I actually need to file a claim, or should I stick with my current insurance company? Do you have any suggestions for other insurance quotes I can get? Also, do you think you can guess what kind of car I do own? This is a lot of questions but if anyone can even give advice on one of them it would be extremely helpful, as this whole car insurance thing is extremely overwhelming.

photo credit: Valerie Everett via photopin cc


  1. I was literally in the same predicament. I have a 13 year old very reliable car with 162,000 miles and was insured by an insurer with high customer satisfaction ratings and everyone swears how great the are. The problem was that I was paying too much in premium every year to the tune of $1100 and I don’t get tickets and have accident free record overall. Started shopping around and I was finding rates that would save me $600 a year.

    I didn’t hesitate to switch from there since it didn’t make sense to be paying all that money, even if I’m seen as a valuable customer and not some number. Having the extra money meant paying off my student loan debt quickly and having extra money to invest overall.

    If you really love your insurer then stay, but think of the extra cash that could go to paying off that debt or adding more cushion in your budget. Most likely the new insurer you go with will honor their policy with you and not put you through a nightmare since I’ve read customer satisfaction has gone up for most insurers since their is more competition due to market saturation. Once you paid off the student loans and any other debt and would like to go back to your current insurer, then that is a viable plan also.

    It really is all about what you want to prioritize at this point. Hopefully this helps!

    1. Thanks for your detailed response, that was great. I agree that I am paying too much for my premium but unfortunately my shopping around hasn’t led to such great results as the most I was able to save was $200, which isn’t minimal but isn’t amazing either.

      That would mean my insurance company is somewhat in range although clearly not the best offer. I actually just received something in the mail from my employer to sign up for a completely different company and get an employee discount, so I might look into that.

      One thing I’m definitely going to do is take a defensive driving course which will cost like $40 and save me 10% for the next three years. That will easily pay for itself.

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