Auto Loans for Everyone
in the San Diego Area

A Guide to Picking the Right Auto Insurance Provider

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Here is one reason to feel good about living in San Diego: comparatively inexpensive auto insurance. The city is 16th in NerdWallet’s list of Best Cities for Car Insurance, with an average annual car insurance premium of $1,474.71.

Location is a key factor that influences auto insurance rates, and so is the chosen insurance provider. But you shouldn’t pick an insurance provider based solely on rate. If you want to find the right source of auto insurance, you need to assess the provider based on a few other things.

 

Insurer type

Auto insurers come in three main types: captive agents, brokers and direct providers. In order to choose the best one for you, you need to understand the options you have.

Captive agents work for an insurance company and serve as their representatives. They can offer a more personalized service to customers—if you develop a close relationship with an agent, he/she can suggest certain policies that are most suitable in your situation.

Brokers represent a number of insurance companies. Because a broker will not favor any particular company, he/she can help you identify the best policy and best insurer according to your personal needs.

Direct providers directly sell insurance policies to consumers through customer service representatives. The representatives contact consumers either through phone or email. With direct providers, there are no middlemen, so you can save on fees.

Weigh the pros and cons of each insurer type and determine which is most ideal for you.

 

Licensing

The provider you obtain auto insurance from should be licensed to sell insurance in California. Check with the California Department of Insurance if an insurance provider is licensed before you buy. If you buy coverage from an unlicensed provider, you could find yourself in a predicament when you finally need to make a claim.

 

Financial situation

After you verify the licensing, you should extend your research to the insurer’s financial situation. A good insurance provider is one that is financially stable because only financially stable companies can provide the benefits you are entitled to when you need it. To find out if the insurance company is in a stable financial state, look at the financial state ratings it received from the likes of Standard & Poors and Moody’s, among others.

 

Customer feedback

You can tell a lot about a company based on the kind of feedback they get from their customers. Customer feedback reflects whether an insurer is reliable or not, so be wary of insurance providers that have received a considerable number of customer complaints. Prior to choosing an insurer, do a search online about what policyholders are saying about the insurance companies.

You can also consult again with the California Department of Insurance to learn the consumer complaint ratios of the insurers you are considering. A consumer complaint ratio represents the number of complaints the insurer has received for every 1,000 claims filed. While it is alright to check only the ratios in California, it is a better idea to check ratios in different states. You should aim to find an insurance company that has low consumer complaint ratios in various states.

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