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How to Buy Car Insurance: Online or Through an Agent?

If you own a vehicle, you need car insurance.  When buying car insurance, you start by obtaining a quote which is an estimate of the rate you will be paying for a certain amount of coverage.  There are several different ways that you can obtain a car insurance quote and purchase insurance. You can get a quote online, through an agent, through a car insurance broker, or directly from the insurance company.  

There are three main ways to get a car insurance quote and buy car insurance nowadays:

Buying Car Insurance Completely Online

Some car insurance companies offer you the option of purchasing car insurance completely online.  This is a convenient option if you know what you want and do not need to talk to an agent or a broker.  It is important to remember, however, that an insurance agent is in a good position to know what coverage you need to protect your assets and minimize your liability. Furthermore, car insurance agents may be more aware of what discounts you may qualify for. If you do decide to purchase car insurance completely online, some insurance companies such as Liberty Mutual will give you an online purchase discount.

Even though this is a convenient way to purchase auto insurance, not everyone should purchase car insurance completely online.  Insurance agents recommend that only people who do not have significant assets to protect purchase car insurance online. It is important that your auto insurance protects you financially in the event of an accident; therefore, the more you need to protect, the more you need to speak with an insurance agent.

It is important for you to realize that car insurance agents make a commission off of the sale of insurance.  This is true no matter whether the agent is an independent agent or the agent works exclusively for an insurance company (those are called captive agents).  The only exception to this rule is potential direct insurers which may utilize staff instead of agents. Thus, one might conclude logically that you will pay more for exactly the same insurance if you go through an agent than if you do it completely online.  This might be true in most cases, but not always, since insurance companies often sell different insurance products online versus through their agent network, even with exactly the same coverage, and these products are priced differently.

On the other hand, the agent may put some pressure on you to purchase more insurance than you originally asked for. Therefore, if you have done your research and are sure of the company and the coverage, you may want to buy auto insurance completely online. You can start the process by learning where to get free auto insurance quotes online.

Insurance Companies that Allow You to Buy a Car Insurance Policy Completely Online

It still seems more popular for car insurance companies to allow you to obtain a quote online and take it to a local insurance agent.  However, there are several car insurance companies that allow you to purchase auto insurance completely online. Here are some of the largest auto insurance companies that allow you to purchase insurance complete online:

>>MORE: Understanding Car Insurance Quotes

Progressive

Progressive is the third largest insurance company in the United States.  This company allow you to get a quote a purchase your auto insurance completely online here.  It offers a variety of coverage options which include liability, comprehensive, collision, uninsured and underinsured motorist bodily injury, uninsured and underinsured motorist property damage, medical payments, roadside assistance, loan/ lease payoff, rental car reimbursement, custom parts and equipment value coverage, rideshare coverage, and a deductible savings bank.  The company also offers a variety of discounts for which you may qualify. Furthermore, if you have any questions while going through the online process, you can call 1-855-347-3939.

Geico

Geico, the second largest car insurance company in the country, is probably the most digital company in insurance industry. It has grown fast in the past decade with its direct-to-consumers business model. You can get a quote, buy a policy, and service your account completely online. Heavily relying on their digital channel has also helped the company grow fast, increase efficiencies, and offer good prices to its customers. If you are comfortable buying and managing your car insurance completely digitally, Geico is a good option for you.

Nationwide

Nationwide is another large auto insurance company that gives consumers the opportunity to purchase auto insurance online without having to deal with an agent.  This may be good for people who know exactly what coverage they need and do not want to spend time talking a Nationwide agent.  

If you are considering purchasing Nationwide auto insurance online, you may want to know that Nationwide is a very solid company with superior financial strength.  It also is rather large with a significant number of agents and employees in the 46 states that it serves. Nationwide does not provide insurance to residents of Alaska, Hawaii, Louisiana, and Massachusetts.  

If you would like to obtain car insurance directly through the Nationwide website, the company has clear instructions, explaining everything that you need to have with you to purchase the insurance online.  It walks you through the information you need to gather, obtaining your online quote, finding discounts, selecting the right coverage for you, and choosing your payment method.

Liberty Mutual

Of the auto insurance companies that allow you to purchase insurance online, Liberty Mutual makes it the easiest. The company has an easy to navigate website which highlights the online purchase option with an instant discount on your policy for purchasing auto insurance through the company this way.  The company’s website explains your coverage options as well as discounts. In addition, Liberty Mutual presents you with standard coverage and add-on options. Furthermore, the company explains key terms to make understanding auto insurance easier.

MetLife

MetLife is another large insurance company which offers auto insurance.  It has a financial strength rating of Excellent. The company is a large one with over $62 billion in revenue in 2017.  As an auto insurance company, however, its customer service and claims satisfaction ratings are below the industry average.  Additionally, the company is known to offer fewer car insurance discounts than its competitors. Still, it is a solid company financially and if you have other policies with the company you may want to consider getting auto insurance from MetLife as well.  This company now offer MyDirect and provides consumers with a video of the advantages of its self-service car insurance portal.

Others

Several other car insurance companies allow you to purchase car insurance online and your insurance policy will take effect on the same day.  These insurance companies include Esurance, State Farm, Allstate, Farmers, American Family, Amica, and USAA. Some of these companies do no present the purchase option immediately; however, if you go through the quote process, they do give you the option to purchase online.

Buying Car Insurance Through a Local Agent or Broker

Another option is to buy car insurance through a local agent. You can find the phone number of a local agent online, in advertisements, and in the phone book.  One of the primary reasons that you may want to contact a local agent instead of obtaining a quote online is if you have any questions concerning the coverage that you need or situations which may affect your rates.

Another important reason to buy car insurance through an agent, especially an independent agent or broker who represents multiple insurance companies, is that the agent can help you compare your final quotes of several insurers to find the cheapest one for you. Buying car insurance from an insurance broker has its own pros and cons that you should be aware of before committing to this option.

Additionally, if you are not comfortable entering your information online, as with older generations, you can still have all your car insurance needs handled by a local auto insurance agent with most medium and large sized insurance companies.

Insurance Companies That Will Match You with A Local Agent to Start the Quotation Process

Some insurance companies do not offer you the option of obtaining a quote over the internet.  For these insurance companies, you can contact them through the number on their website or on a television commercial or other advertisement and these companies will set you up with a local agent.  Some other auto insurance companies are willing to match you with a local agent upon request, even if you have not received a quote.

State Farm

While you can buy a car insurance policy from State Farm completely online, State Farm relies heavily on its network of 18,000 agents to sell car insurance to consumers across the country. Agents working for State Farm are captive agents, they sell State Farm insurance exclusively and they usually sell all types of State Farm insurance: car insurance, home insurance, health insurance, and life insurance. In most cases, State Farm will match you with a local agent in your area to service you, so if you prefer human interaction when it comes to your insurance, State Farm is a good choice. You can contact State Farm agents by calling 1-800-STATEFARM.

State Farm is the largest insurance company in the nation.  It has an A.M. Best financial strength rating of A++. Furthermore, it is slightly above the industry average for claims satisfaction.  The company offers a wide range of auto coverages and discounts.

Allstate

Similar to State Farm, despite available online, Allstate relies on its network of captive agents to sell insurance to consumers across the country. The company allows you to get in touch with an agent by simply clicking a button on its webpage. The button expands and shows you some local agents whom you can contact to get the ball rolling.  This is an excellent choice for people who want to haver there auto insurance needs handled by a person instead of online.

Allstate, the 4th largest insurer in the US, offer car insurance in all states in the United States except Michigan, Florida, and New York.  Its auto claims satisfaction rating is almost at the industry average and it has an A.M. Best financial strength rating of A+. It offers the typical range of insurance options and discounts.

Hybrid: Start Online and Finish with An Insurance Agent or Broker

You can always start by getting an auto insurance quote online and taking it to a local insurance agent, either in-person or over the phone.  Almost all medium and large sized auto insurance companies allow you to get a quote online and either get contacted by a local agent or take the quote to the agent of your choice.  This is useful in allowing you to find out the rate before you decide whether you want to get in touch with an agent. Therefore, you do not have to worry about being pressured into a surprise rate that is out of your price range.

Insurance Companies That Will Allow You to Start the Process Online, But You Need to Finish Buying a Policy with a Local Agent

Erie

Erie is a regional insurance company that serves twelve states which include Illinois, Indiana, Kentucky, Maryland, New York, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia, Wisconsin—and the District of Columbia.  It is a Fortune 500 company with over 5 million policies in place and a high level of claims satisfaction according to a J.D. Power survey.

Unlike many of the other well-known insurance companies, Erie does not offer the option to purchase car insurance online. You can, however, obtain a quote online and then be connected with an agent.  The company boasts that it has over 12,100 agents, licensed professional with a strong local presence, who can help you choose the right coverage.  Still, the website explains all the company’s coverage options and discounts.

Travelers

Travelers is a large insurance company with an A++ financial strength rating and an auto claims satisfaction rating that is about average.  It’s customer service rating, on the other hand, is a little low. However, the company is a stable company that offers many of the traditional auto insurance coverage options and discounts which you can find on its website.

On the website you can receive a quote and then be matched with an agent to complete your purchase.  In fact, the company is known for offering an in-person agent experience to consumers making this company a good option for people who want the financial security that comes from a large insurance company and still offers personal interaction with an agent.

AAA

AAA, also known as the Auto Club of Southern California Insurance Group, is a major auto insurance company that has been in business for more than 100 years and is open to members only of which it has 50 million.  

AAA does allow the general population to apply for and obtain membership.  Current and future members can obtain an auto insurance quote online on their website.  After obtaining a quote on their website, if you like to quote you can call 877-323-4222 with your quote reference number in hand to purchase the insurance.  If you do not go through a broker or compare quotes with other insurance companies, it is important for you to note that AAA’s rates are on the very high side.

SafeCo

SafeCo is another company offer auto insurance which allows you to start a quote online but requires you to purchase from an agent.  The company is known for offering average rates with a rather low customer service ranking.  The company also has a low claims satisfaction rating compared to its competitors. The company’s website, however, does list the coverage options and discounts for which a consumer may qualify.

One unique aspect of SafeCo is that it works with independent agents whereas most auto insurance companies use captive agents which work for that insurance company.

>>MORE: Pros and Cons of Buying Car Insurance from An Insurance Broker

What Is The Difference Between A Bindable Quote And A Non-bindable Quote?

Non-bindable Car Insurance Quote

A non-bindable quote is an estimate of how much a certain amount of coverage is going to cost. There is no obligation for the car insurance company to sell the insurance at this rate simply because of the quote.  The consumer does not have any obligation to purchase the insurance either. The overwhelming majority of online auto insurance quotes that you receive are non-bindable quotes.

The first quote you are presented with when shopping for car insurance online is almost always non-bindable. The rate that the auto insurance company charges you can change when you speak to an agent or are about to complete your final purchase.

Bindable Car Insurance Quote

A bindable quote is, on the other hand, a quote that comes with the obligation that auto insurance will be sold and purchased for the agreed upon price.  A bindable quote takes place before the policy is issued. If all the information that you provide as a consumer is true and accurate and the car insurance company offers a bindable quote, the insurance company, typically through its agent or a broker, agrees to provide you the said coverage at the agreed upon price.

A bindable quote can be seen as a temporary insurance policy until the formal policy is issued. Insurance companies usually present you with the bindable quote after being able to verify all information you provide in your application, including your personal information, credit worthiness, driving record, and the car you want to insure.

What Information Do Car Insurance Companies Need from You to Provide You with A Bindable Quote?

The easiest way to receive a bindable quote is by obtaining the declaration page of your current car insurance contract if you have auto insurance.  This declaration page contains the information from your current auto insurance company that another car insurance company would need to issue you a new policy.  The declaration page shows your current coverage as well as your policy rating as a driver. Furthermore, your vehicle information as well as information concerning tickets and accidents are on the declaration page.  Additionally, your average annual mileage and car usage are also present.

If you do not currently have car insurance and thus cannot present a declaration page, a motor vehicle report is the second-best thing.  You also want to have the full name, gender, and marital status of all drivers currently residing in your household as well as the number of years that each driver has had a license.   Additionally, you need car information for all your cars including the make, model, year, safety features, and VIN. You should also have information concerning your driving habits such as how many miles you commute each day readily available. Moreover, you need to know your zip code and credit rating.

Final Thoughts

Auto insurance companies allow you to get a quote and purchase car insurance in several different ways these days.  These ways include completely online, get a quote online and purchase though an agent, and get a quote and purchase completely through an agent.  It is important to remember that quotes that you receive online are probably not bindable in nature and are only estimates of what you are going to pay for the coverage you desire.  Either way, it is important for you to have all your information handy so that you can receive a quote that is as accurate as possible to help you decide whether you want to purchase auto insurance through that company or another one.

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