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Learning to be a smart driver was one thing, but becoming a smart insurance shopper? That’s a whole different learning curve. With motor vehicle insurance prices up roughly 19% year over year and typical full‑coverage premiums clustering from the low‑$2,300s (J.D. Power) to about $2,5xx (Bankrate) in 2025—and some high‑cost states averaging $3,000+ (Insurify)—it pays to approach the market with a data‑driven plan. Below are concrete steps to find the coverage you need at a fair price, grounded in current consumer research and official state rules.
Decide whether to buy through an agent or DIY
You can purchase car insurance through an independent agent, who will compare coverage and quotes on your behalf, or compare quotes and buy direct from the provider on your own. DIY auto insurance shopping is often most convenient since most companies let you compare rates online. If you’re a low‑mileage or safe driver, many carriers now let you enroll in usage‑based/telematics programs at quote or bind; per NAIC, typical safe‑driving telematics savings fall in about the 5%–30% range, and some programs offer an initial sign‑up credit before adjusting based on driving. Be aware that certain programs may also apply surcharges for persistently risky driving, depending on state rules and the carrier.
An independent agent can be helpful if you’re not feeling confident about choosing the right coverage or are having trouble finding affordable insurance on your own (for example, if you have a poor driving record or filed multiple claims in the past). An independent agent can also help you combine multiple policies and find the best auto and home insurance bundling deal. Bundling is one of the largest and most widely available savings levers across major carriers—eligibility and savings vary by state and company; review discount pages from State Farm, Progressive, Allstate, GEICO, Liberty Mutual, and Travelers to see which multi‑policy, multi‑vehicle, pay‑in‑full, and paperless discounts you can stack in your state.
“Additionally,” says Bill Hebert, Regional Director at Mercury Insurance, “independent agents can identify discounts for you, and they often work with smaller, regional auto insurance companies who provide great service and may have lower rates.” This is a good option for people who prefer hands-on, personalized assistance. Major carrier pages confirm that multi‑policy, multi‑car, telematics, good‑driver, and billing‑related discounts are commonly available (with state‑specific rules)—see examples from Progressive and Travelers.
Figure out how much coverage you need
Each state has unique auto insurance requirements. Notable 2025 updates include California’s minimum liability increase to 30/60/15 (California DMV) and Virginia’s move to 50/100/25 (Va. Code § 46.2‑472). Florida remains a no‑fault state requiring $10,000 PIP and $10,000 property damage liability, with no general BI requirement (FLHSMV). Michigan continues its no‑fault system with PIP choice levels, Property Protection Insurance up to $1 million, and residual liability minimums generally 50/100/10 (Michigan DIFS). New York requires 25/50/10 liability, $50,000 PIP, and UM for BI (NY DMV). New Hampshire remains the exception to compulsory insurance, but if you buy a policy or must show financial responsibility, minimums (e.g., 25/50/25 liability, $1,000 MedPay, and UM at least equal to BI) apply (NH DMV). In no‑fault jurisdictions, PIP is mandatory (Insurance Information Institute).
“Chances are that you will need more liability insurance than the state requires because accidents cost more than the minimum limits. If you’re found legally responsible for bills that are more than your insurance covers, you will have to pay the difference out of your own pocket.”
The Insurance Information Institute
Of course, it’s important to keep the value of your car and assets in mind when setting coverage limits. If you drive for a rideshare platform, know the “periods” and gaps: when the app is on and you’re waiting (Period 1), platforms typically provide contingent liability of 50/100/25; when matched and on a trip (Periods 2–3), third‑party liability is at least $1,000,000, and contingent comprehensive/collision applies only if you carry those on your personal policy—often with a $2,500 deductible (Uber; Lyft). Personal policies usually exclude livery without an endorsement, so consider a rideshare endorsement or hybrid/commercial policy and carry strong UM/UIM and PIP/MedPay as required or appropriate (III; NCSL).
“Car insurance shoppers should have a good idea of what their needs will be when using the vehicle. For example, if the shopper has an older vehicle that isn’t worth more than the deductible on a comprehensive policy, they should determine if this is worth the additional premium. Or, if they’re going to be using the vehicle for a gig economy job like driving for Uber or Lyft, then they’ll want to look into coverage options to supplement the personal auto policy.”
Bill Hebert Regional Director at Mercury Insurance
Be sure to research coverage options and decide what you need before comparing companies or quotes. Confirm your desired liability limits, UM/UIM, PIP/MedPay, physical damage deductibles, and whether you’ll opt into a telematics program or bundle with home/renters—changing these later will change the price.
For more information about coverage, see our complete guide to auto insurance.
Research the best auto insurers for you
Next, find providers that offer the coverage you need, strong financial backing, and reliable claims service. Recent research shows claims satisfaction hinges on cycle time, proactive/transparent updates, and effective digital tools for FNOL, documentation, status tracking, and fast payments (J.D. Power Auto Claims Satisfaction Study). Also review current premium context and discount availability (telematics, bundling, student, vehicle safety) and consider both established carriers and newer digital or telematics‑first options where they fit your profile; industry outlooks note stabilized insurtech funding and a maturing set of MGAs/carriers focused on profitable growth and embedded distribution (Deloitte 2025 insurance outlook; Gallagher Re Global InsurTech Report). We evaluated fourteen top‑notch auto insurance companies in our review of the best auto insurance; these are a good place to start when requesting quotes.
Compare quotes and choose the lowest bidder
Once you’ve gathered a list of promising insurers, do a head‑to‑head price comparison. Quotes can vary widely, so we recommend compare rates online from as many companies as possible. Include at least one bundled quote (auto + home or renters) and consider a telematics option if you’re a safe or low‑mileage driver. The NAIC notes typical safe‑driving program savings of about 5%–30% (some offer an upfront enrollment credit) and cautions that certain programs allow surcharges for high‑risk driving. J.D. Power also reports that customers who receive telematics discounts tend to be more satisfied even amid higher market prices (2024 study insights).
And remember, price isn’t all that matters. The “best” auto insurer is one that gives you an affordable rate and peace of mind that your claim will be settled fairly after an accident. Claims experiences are driven by speed to inspection/repair/payment and clear, proactive communication, so factor in recent claims performance and digital capabilities (J.D. Power claims study) as you shop.
“The most important factors to consider are not just price, but the actual coverages being sold. Certain carriers offer really cheap insurance and people first realize how truly limited their coverage is only when they have an accident. Like with most things in life, you get what you pay for.”
Christopher Earley Auto accident attorney in Boston, MA
Shopping pro tip: Auto insurance rates depend on coverage, among other things. Use the same liability limits, deductibles, drivers/vehicles, bundling choice, and telematics participation each time you request a quote to get an accurate, apples‑to‑apples comparison (NAIC).
Learn how to save without sacrificing coverage in our guide to cheap auto insurance.
Purchase your new auto insurance policy
The hard part’s over. You’ve found an auto insurance company that meets your coverage needs and price point. The last thing to do is simply hit “buy.” Some companies will let you buy directly online, while others will offer you an online quote but finish the sales process through an agent. Either way, follow the steps your insurer lays out for you.
Shopping pro tip: Many companies offer billing‑related savings for paying premiums as a lump sum and for choosing paperless/autopay. Compare an annual or six‑month pay‑in‑full option to monthly billing to see how much you could save (availability varies by state—see carrier discount pages like Progressive, Allstate, and Travelers).
Cancel your current policy
You can cancel an auto insurance policy at any time. If you move, get a second car, or add a new driver, you don’t have to wait until your current coverage ends to shop for better rates.
That said, you should only cancel your current auto insurance after securing a new policy. Avoid any lapse in coverage—states enforce financial responsibility and may impose fines or suspend your license/registration after a gap, and some situations require filings such as SR‑22/FR‑44 depending on state law (CA DMV; Virginia; FLHSMV; NY DMV). When you’re ready to cancel, most companies will have you sign a notice of cancellation; call your insurer or check its website for the exact steps.
Insurers typically refund any unearned premium if you end coverage early. Depending on your policy and state filings, a short‑rate or administrative fee may apply—review your policy terms before you cancel.
What’s next?
Review of the best auto insurance companies
How to switch car insurance companies
Why 40% of drivers don’t shop for auto insurance as often as they should
