What is Considered ‘Cheap’ Full Coverage Auto Insurance?

updated: Nov. 7, 2019 –

When it comes to full coverage auto insurance, is it really a good idea to go “cheap”?

This depends on what is meant by cheap… cheap in quality or cheap in price? The important thing to remember is the two don’t necessarily go hand in hand.

The best advice when shopping for ‘cheap’ is to always look for excellent quality at the lowest price available. Fortunately high quality, full coverage auto insurance is out there to be had at a reasonable price; you just have to do a little searching and understand some of the basics about auto insurance.

If you are a millionaire, chances are that ‘cheap’ is irrelevant and you can afford expensive automobiles and expensive, all-the-bells-and-whistles coverage. For the rest of us, here are some ways you can get excellent coverage without breaking your bank:

1. Compare apples to apples – If Insurance Company A is offering premiums at $130 and everyone else is charging $180 per month for the same coverage, then as long as Company A is a reputable company, why not go with the “cheap” price of $130 per month from Company A. The trick here is to be sure that each company’s policy is identical or at least comparable. Pay attention and consider your options carefully.
2. Consider your car’s value – If the amount of your annual premiums exceeds the value of your car, that really doesn’t make sense, does it? If you are driving a ‘cheap’ car, then expensive, Cadillac-level coverage would be way too much. Opt instead for modest coverage and think about simply replacing the car with money saved on premiums should your car be damaged or totaled.
3. Consider your risk tolerance – Are you a speed demon? Do you live in a sketchy area? Do you clock 20,000 miles per year on long commutes? All of these things add up to greater risk, which means that “cheap” premiums (offset by a high deductible) could be a poor bet. In the event of an accident, you’d have to pay a lot out of pocket before your benefits kick in.  Conversely, ‘cheap’ may be possible if you drive few miles, live in a safe area, don’t often drive in heavy traffic and have a stellar driving record. If this is the case, then a high deductible would lower your monthly premiums with less risk being added.
4. Be a safer driver and (possibly) get paid for it – Creative auto insurance companies are starting to offer cheaper insurance to drivers who can demonstrate safe driving habits. Some insurers actually attach a device to your car and monitor you for, say, 30 days, seeing if you stay within safe speed limits and practice good braking techniques—all hallmarks of a safe driver who is less likely to cost the insurer money paid out in claims. If you have bad driving habits, now is the time to reform yourself and possibly get a better deal on your insurance.
5. Read the fine print – Are you paying for services you don’t really need? For example, do you need insurance to cover a rental car if your city has a good system of public transportation? Think about the possible outcomes of an auto accident and decide which services are absolute “musts” and which you could take care of through other means.

The Best Way to Save

These methods are all fine and good, but there is yet another way to find cheap full coverage auto insurance: take advantage of the over-saturation of the market.

Nearly every insurer on the planet is trying to entice customers away from their competitors by offering discounts and lower rates. If you shop around by comparing quotes, you will quickly see that some companies are willing to offer your current coverage or better at a lower price, and abracadabra, you’ve just found the best “cheap” insurance!

Just enter your Zip code into our quote finder and it will help you generate quotes from several insurers for the same car, driver and type of insurance.