You did your research, shopped around, and just got a great quote on car insurance. You decide to go for it and get a policy! But when your insurer finalizes the policy, the premium is different. Sometimes the difference between your quote and your actual premium is marginal. Other times, there’s a big difference, and your premium is significantly higher (or lower!) than your quote.
It’s frustrating, but the truth is, most auto insurance quotes change at least a little by the time the policy is bound. There are a few reasons why car insurance quotes and rates differ! Here’s what you need to know:
The Difference Between an Insurance Quote and an Insurance Premium
An insurance quote is an estimate of how much the insurance company will charge you for your insurance policy. To simplify and speed up the quoting process, insurance companies usually don’t gather as much information from you upfront when creating an insurance quote as they do when writing an actual insurance policy.
An insurance premium is the amount of money you pay to the insurance company for your policy.
While a quote is an estimated cost, the premium is the actual cost.
3 Reasons Why Your Insurance Premium Costs More Than Your Quote
Because insurance quotes are usually based on approximate information, there is often a difference between your initial quote and your finalized premium. You might get a quote for a certain price, but when the insurer verifies your information later to write your policy and something doesn’t line up, the result can be a higher premium.
Take a look at these common reasons why your insurance premium and quote might not match:
1. Your driving record
Say you’re getting an insurance quote and the insurer asks you about your driving record. You say you haven’t had any recent traffic violations or accidents. Your quote comes back with a reasonable rate and you decide to sign up for a policy. Later, the insurer verifies your driving history to create your policy and discovers two speeding tickets you got a few years back that still haven’t fallen off your record. If you have traffic violations or accidents on your record that you forgot about or neglected to mention when you were getting a quote, you can expect to see an increase from your initial quote to your premium.
Traffic violations, convictions, and car accidents stay on your driving record longer than you might realize. The length of time depends on your state and the severity of the violation. In Florida, traffic violations like speeding or reckless driving can stay on your record for at least five years.
The number of years an insurer goes back into your driving history depends on the insurance company and your state. The good news is that once an accident or violation falls off your record, it usually doesn’t affect your car insurance rates anymore.
2. Your VIN number
For the sake of getting you a quote quickly, an agent or insurer might not ask for your Vehicle Identification Number (VIN), and instead base it off your vehicle’s make, year, and model. If you decide to get a policy, however, the insurer will need the VIN to write the policy and ensure an accurate premium.
You might have told your insurer that you drive a 2012 base model Nissan Rogue with front-wheel drive when you were getting a quote, but according to the VIN, it’s actually a 2013 Nissan Rogue with all-wheel drive, a high-powered engine, and a more expensive trim level that costs a little more to insure.
3. The coverage you select
You might have gotten a quote for liability only insurance, but if you decide to add more coverages to your policy or lower your deductible, it can make a big difference in your premium. You may also be required to carry comprehensive and collision insurance if you’re financing your vehicle, which can also lead to a higher premium.
How to Get a More Accurate Car Insurance Quote
A quote is only as accurate as the information it’s based on. If possible, share as much correct information as you can during the quoting process to get a more accurate quote on car insurance. These tips can help you avoid errors – and an unpleasant surprise:
1. Check your driving record
If you know those speeding tickets from a few years ago still haven’t aged off of your driving record, you can share that information with your insurer when you’re getting a quote. You can order your driving record through your state’s DMV or a third-party vendor. A third-party provider may be able to get it to you faster, but going through your state’s DMV is usually cheaper.
2. Get your car’s VIN
Instead of getting a quote that’s loosely based on your car’s make, year, and model, get a quote for your actual vehicle with your VIN number. You can find your VIN number on the driver’s side windshield or on the driver’s side doorframe.
3. Shop for car insurance periodically
It’s a smart idea to shop around for auto insurance periodically or whenever you have a life change, like if you move, get married, add a new car or driver to your policy, take a driver safety course, or if several years have passed since you had an accident or got a ticket. The low rate you got a year ago might not be the lowest rate anymore!
At Direct Auto, we try our best to give our customers the most accurate car insurance quotes possible. Curious whether you might qualify for a lower rate? Get a free quote today! Call 1-877-GO-DIRECT (1-877-463-4732) or visit a Direct Auto location near you to get started.