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How Auto Insurance Quotes Work

 


How Auto Insurance Quotes Work: What happens when you request a quote from an agent or via an insurance company's website? Let's review the quote process from both the insurer's and consumer's points of view.

Quotes from the Insurer's Perspective

Quotes are based on the insurance company's initial estimation of your risk as a driver, in combination with any discounts you might qualify for. The risk equation depends on various factors, including the insurance regulations in your state. For example, in some states, insurers can take your credit history into account. In other states, insurers aren't allowed to consider your credit history. In general, these factors could influence your quote:

  • Your driving record, marital status, gender, and age
  • Your location and how you use your vehicle
  • Prior insurance coverage
  • Any discounts you qualify for (such as combined auto and home coverage)
  • Your choice of deductible
  • Optional coverage, such as rental car reimbursement coverage

Insurers weigh factors differently, so their quotes will vary. To make accurate comparisons of rates from different insurers, you should provide the same information to each one.

Your final auto insurance rate can be different from the quote you receive.  That's because the insurer will likely request your official driving history and a report from CLUE (Comprehensive Loss Underwriting Exchange) before issuing you a policy. CLUE is an insurers' information database that collects past and present claim histories. The information in these reports can affect the final policy cost.

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