Just as the sales price of a new or used car usually varies from dealership to dealership, the cost of auto insurance differs greatly among different insurance companies. Shop around for coverage and this will become immediately apparent. One insurance provider will charge more than another to insure the same car and the same driver with the same level of coverage. And sometimes the difference can be thousands of dollars a year.
Recently, Nina, a retired grandmother living near Palm Springs, California, experienced this firsthand while looking for a new insurance policy for her 10-year-old Mercedes-Benz. She had been paying nearly $3,500 a year and thought she might be able to get a better deal. With one phone call to another insurer, her annual rate dropped radically — to just $1,300 a year for the same level of coverage. “I was shocked,” she says. “The price difference was huge, and it just took one phone call and a few minutes to change insurance providers and save all that money.”
This is why it’s so important to shop around for auto insurance. Auto insurance rates differ because each company uses a unique formula and varying factors to calculate your insurance premiums.