The world of auto insurance is complicated and premiums payable for a given policy vary from person to person. Simply put who you are determines how much you will pay as car insurance premium. Automobile insurers use a large number of risk factors to compute how much premium is payable by any individual.

Basic factors that determine how much you need to pay for auto insurance are:

1. The age of the driver. Young and old drivers need to pay more insurance premiums as they are more likely to have accidents than middle aged drivers. In addition premium payable is determined by the car you drive. If you drive a sports car or any mean machine then your premium will hit the sky as compared to a sedan or compact car.

2. The gender of the driver. Insurance companies have determined that women drivers are not affected by hormone surges or machoness and are so better drivers than men. Statistically women are proven to be safer drivers so a woman driver will pay lower auto insurance than a male.

3. Where you live can change your car insurance rate. Auto insurance companies compute risk by where a car owner resides. Those living in rural areas or suburbs pay lower insurance premiums than those who live in a city.

4. Safe Driving is a factor that influences your premiums. Most insurers lower premiums payable for persons who have a safe driving record for three years and more. So speeding tickets, accidents, parking violations, and running red lights are all factors that can save you money.

5. Your credit history. Most insurance companies consider an individual with a good credit history and score as a lower risk and offer lower premiums on auto insurance. The credit report reflects the fact that you are a responsible individual and are dependable.

Other factors that can lower auto insurance premiums are: safety features in a car; anti-theft devices; eco-friendly fuel use; use of car pools and public transport; exclusive use of vehicle only for personal use and so on.

Insurance companies set premium rates based on factors like make of car, cost of parts, and sticker price of car. In case an individual updates his driving skills regularly and follows all safety norms and rules laid by the highway and road patrols then the insurers offer lowered premium rates.

If you have a membership at the AAA or any other professional body then you may be automatically eligible for a discount on auto insurance rates. Lately if auto insurance is bought online the rates are much lower than when bought through an agent or office. And, different insurers base the premiums on auto insurance based on their experience so while one may consider the occupation of the individual a risk another may give more emphasis on whether the vehicle is used for commercial purposes. The module for calculating risk factors varies from company to company as also the premium rates on auto insurance.

So it is best to get at least 3-4 quotes from different auto insurance providers before making a decision.

The Insurance is taken to defend ourselves against any unforeseen calamities. In law and economics, it is defined as a form of a risk management which is used to hedge against the risk of a contingent loss. Today, you can find insurance policies for almost everything. It can be for your life, health or for any appliance protection.

The insurance policies are offered by the insurance companies to an organisation or to an individual in return of the premiums paid. As far as the car insurance is concerned, the insurance companies can give coverage to your car against any accidents or the breakdowns. The policy which is offered to insure a vehicle depends upon different factors like, make, cost, age, type of vehicle, viable statistics, individual habits and history.

The premiums depend upon the risks factors, e.g. a young driver who drives a sports car will have to pay more premium as compared to a person who is a senior citizen and drives a family sedan.

The different insurance companies in the market offer various coverage and plans. To avail the best car insurance, you should follow these steps:

Do an online survey and then compare the quotes offered by the different car insurance providers. Compile all the relevant information which would help the car insurance provider to give you a competitive quote. They may require your personal details, the number of persons who will drive the vehicle, make and age of the vehicle etc.

Read the policy document carefully and should ask for the clarifications, if you are unable to comprehend any terms or conditions. Use the online insurance computation with quote comparison tools, which will help you to know which insurance coverage would be best for you. Consult an insurance broker who may assist you to get a suitable insurance coverage.

Though, you can buy insurance from an insurance company or a broker but by buying an online insurance can give you many advantages. You are required to fill up an online application form which can help you to get the quotes from different car insurance providers. The quotes are absolutely free and you can take your time for selecting a suitable car insurance provider. If you buy insurance online you may avail discount as the company doesn’t have to spend on the data compilation and meeting you for discussing the possibilities. The Internet has certainly changed the world of insurance industry and now you can purchase an insurance policy online as an informed buyer.

In the late 1990’s, as the internet gained popularity, consumers realized the convenience of shopping online for many different things including car insurance. The internet offers endless information about any subject you need to know more about and it even allows you to complete important purchases such as buying auto insurance online.

Buying auto insurance online not only saves you money, but also carries many benefits which make your life easier. Plenty of auto insurance companies offer discounts for purchasing auto insurance online. The reason companies offer discounts is because when you purchase auto insurance online, the costs associated with issuing the auto insurance policy is significantly less costly for the insurance company compared to issuing an auto policy the traditional way.

When purchasing car insurance online, you are saving the insurance company money, therefore, the savings can be transferred to you. Other reasons for saving money by buying car insurance online is that you do not need to waste time and money, such as gas, driving to the agents office. Also some of the fees that are included in buying car insurance the traditional method are often not charged. Some examples are:

* An agent’s Commission

* Broker’s Fees

* Endorsement Fees

* Renewal Fees

Not only are you saving money by buying auto insurance online, you are also getting the benefit of being able to manage your auto insurance online. If you buy auto insurance online, most companies will offer you the convenience of finding answers to your questions online and making changes to your policy online. That makes life easier for the most of us. Finding important information such as legal information can also be easily researched before buying auto insurance online.

One of the best reasons for purchasing car insurance online is that you can compare insurance rates from many quality companies in order to make sure you are receiving the cheapest car insurance rates. Many websites offer the ability to compare car insurance online from many quality auto insurance companies such as Progressive, AIG, GMAC, Infinity and more. One such website is OnlineAutoInsurance.com which offers you free quotes from many quality auto insurance companies with one single process. You can even buy you car insurance online and make changes, payments and find answers online and even speak to a licensed agent if you wish.

Even tho you do not always have a choice about having auto insurance, you do have a choice about which auto insurance company you pay for your automobile coverage. Is it important to know something about the various companies that will offer you their services? Yes, of course it is.

Here is some information that may help you in deciding which company may be better for you than another and who can reduce your premiums and at the same time provide excellent customer service, excellent auto insurance coverage and be there when you need them. And I don't mean just answering the phone. I mean the financial security in knowing they can pay you when you need them to handle a claim for your vehicle.

Here are a few things to consider:

What is the track record of the insurance company you are considering using? Do they pay you in a timely manner or do they have a track record of denying claims unfairly and not paying at all?

Do they provide a phone number, website and email to provide you with alternative ways to contact them easily and quickly?

How is their customer service?

What discounts do they offer and how many?

Do they specialize in the vehicle your insuring such as a motorcycle or antique car? Many of them do and you should be aware of that because this service can be especially tailored to fit your needs and they will understand your passions and needs in these specialized areas. It makes it a lot more fun to talk with someone who knows what you are talking about when it comes to your motorcycle driving habits and the coverage you will need, if you only ride in the summers.

Do they offer the good driving record discounts?

Does the auto insurance company you are looking into offer special programs and coverage for multiple vehicle households with teen drivers?

Are you 50 years of age or older? Do you know there are auto insurance companies that will provide excellent auto insurance discounts to the baby boomers? Yup, AARP offers many, many discounts above and beyond auto insurance to it's members. Can you afford $12.95/yr? If so, you can be a member and get a discount on your insurance as well as many other offers to save you money.

Spend some time and check out some of the companies listed here to see if they can help you save money and get excellent customer service and be there when you need them most.

The best way to get the cheapest car insurance rate is to compare car insurance rates from a number of companies. Here's the quickest and easiest way to do that.

Compare Car Insurance Rates

In the days prior to the Internet, you had to call a number of insurance agents and answer a ton of questions in order to get enough quotes to get a cheap rate. Now, thanks to the Internet, comparing car insurance rates is a piece of cake.

Because rates can vary by $1,000 or more from one company to another, you need to go to an insurance comparison website where you can get quotes from a number of car insurance companies.

Not only can you get multiple rate quotes from these sites, some of these sites offer money-saving tips in their "Articles" section, and provide an online chat feature and toll-free telephone service so you can get answers to your questions from an insurance expert. (See link below.)

Get Car Insurance Discounts

In order to get your car insurance quotes, you'll need to fill out a simple questionnaire where you can list the all discounts and deductibles you want. Here's how to save the most money on your insurance:

Raise your deductible - Depending on how high you raise it this can save you 30% to 50% on your car insurance premium.

Consolidate your insurance - Buying your car and homeowners insurance with the same company will save you up to 15% on your premium.

Install security devices - Outfitting your car with a burglar alarm or other theft-prevention devices can get you a good-sized discount.

Eliminate unneeded coverage - Consider eliminating your comprehensive and collision coverage if your car is more than five years old, or if the cost of your annual premium is the same as the value of your car.

Compare Car Insurance Companies

Once you've chosen the best quote, you'll want to make sure the company is reliable and will pay your claims. Here are three websites that will help you decide:

1. Your state’s department of insurance website will show you how many complaints have been lodged against an insurance company.

2. J.D. Power and Associate's website (jdpower.com) will give you consumer ratings.

3. The A.M. Best (ambest.com) website will give you a company's financial and credit ratings.

By taking these extra steps, you'll know that you're not only getting the best rate, but that you're getting a reliable company.

There are many things you can do to save much in your auto insurance. Some give wonderful results; others give so so results. However, if you're really serious about making massive savings in auto insurance you can't afford to leave this out...

But first things first. You must understand why you are getting auto insurance coverage. Are you only interested in fulfilling the minimum required by your state law? Do you want something that truly gives you total coverage as far as your use of the road is concerned? These should be first established in your mind before you begin your quest for savings. I say this because some people who really want the most extensive coverage begin to compromise their coverage all in the name of making savings.

Savings must be without losing what you really want. And, you will make savings if you follow my next advice wholeheartedly. This is irrespective of whether you want bare-bones minimum auto insurance or the most extensive insurance. Please, do bear in my, however, that I am not endorsing any position (extensive or minimum coverage) here. That issue is dealt with in other articles. So now to the meat...

You might have heard of auto insurance quotes sites. Yes, you might even have used them. However, you might not have maximized your profits because you left something out. You only visited one car insurance quotes site and felt you had it covered. No, you didn't have it covered.

Make sure you get quotes from at least three auto insurance quotes sites. This guarantees that you nullify the effects of sponsors' interests on some sites and, furthermore, you have a broader basis for your comparison.

That you can save up to and above $2,000 on your automobile insurance is a fact. However, the important thing is whether you too can make even a fraction of such massive savings. You can if you take out time to understand the little things that really help you make massive savings. I'll share two with you here...

There are different levels of insurance coverage in auto insurance. You can take a comprehensive package or even include several special add-ons. At the other end of the spectrum, you can just go for a third party only cover where the law allows that. But you must be very careful. The minimum required by law sometimes is certainly not good enough for you. The key is knowing when the minimum is the best and when you need as much coverage as you can get.

If you have an old car (I'm not talking about classics here -- Those ones really do belong to a special class) then you will really do well to get the very minimum required by law. If the minimum is third party only coverage, fine. Take it. Getting more won't really do you any good on the long run.

Here's why I maintain this position: Let's say you have a collision policy on an old car and then have to make a claim. The insurance company will make pay outs based on the current value of your car. That's not good considering that your old car won't be worth much then. To make a bad thing even worse, you'll be expected to pay your deductible first before getting whatever the insurance company will give. If you add up all this you'll see that you're really better off keeping all the hard-earned money you'd spend on premiums for superior coverage.

If your auto insurance doesn't serve you on the long run, then you really shouldn't get it. Well, that's my position on auto insurance for old cars.

Another thing you have to do to increase your chances of realizing massive savings in your car insurance is to get as many auto insurance quotes as you can. No, getting a set of quotes from one quotes site isn't enough. You could be missing some insurance companies that are not covered by the first quotes site. Get auto insurance quotes from at least three sites and you would be setting yourself up for massive savings.