When you go out shopping, whether it’s for food or clothes, the odds are you pick and choose. First off, you look at what’s available and then check out the prices. Perhaps you read the labels to make sure there’s not too much cholesterol or the clothes will wash easily. If in doubt, you try several stores until you find what you want. Well, treat buying an auto insurance policy the same way. Just as you don’t buy the first thing you see in a store, don’t buy the first policy some fast-talking agent offers you.

So just as you might make a list before you go out shopping, the first thing you need to do is decide exactly what cover you want. Perhaps you can make do with the local state minimum, or the way in which you use the vehicle makes it important to have better cover. Remember the price you pay as the premium changes depending on who you are, what you drive and how much you drive it.

There’s a fundamental rule when you’re looking to make a deal: never assume the first price you’re offered is the last. No matter who you’re setting out to deal with, whether it’s the biggest or smallest fish in the pond, you can always get a price reduction if you know what to ask for.

When it comes to auto insurance policies, the first price you’re likely to see is one of the free online quotes. But, when you got that quote did you get all the discounts? Auto insurance is as much about the car as it is about you. If your car has all the latest safety features built in, your premium will come down fast. Look for daytime running lights, antilock braking systems, air bags and antitheft devices – if it’s an expensive car, think about having a tracking system installed and always try to park it somewhere more secure off the road at night.

Always ask your insurance company before you buy a car. This is not just about the sticker price (although this will be important when you come to decide whether you want collision and comprehensive cover), but about the cost of repairs. Replacement parts may have to be imported which adds time and expense – remember you may be renting an alternate car while your’s is off the road. Then there are those statistics. Some cars have a better safety record than others.

Did you remember the deductibles? This is a kind of self-insurance where you agree to pay the first however many dollars of a claim. The greater the burden you agree to take, the higher the discount. But watch out. If you have a bad run of accidents, you have to pay this amount every time there is a claim. So don’t just ask yourself whether you can afford to pay this as a one-time hit. Could you take two or three hits in a year?

Then there’s bundling. This is a simple matter of economics. The more premium dollars you give an insurer, the better the value you get. Every company will give you an additional discount if you place both auto and household policies. If you add in second cars and health cover as well, the savings can be significant.

These are economic hard times. Gas looks as though it’s going to cost more than $4 a gallon for the next year, the cost of food and other basics has been shooting up, and the job market is shrinking. But you can’t do without your car. You live in the suburbs and have to commute. Public transport is inconvenient and expensive. So you’re looking to save money on your vehicle.

Big warning sticker: don’t just buy the cheapest auto insurance you can find. As with everything else, you get what you pay for. You should be looking for affordable and not cheap auto insurance, i.e. reasonable coverage at a price that isn’t going to break the bank from a company that handles claims efficiently and fairly. Just as the insurance company is going to check you out, see whether you have any tickets hidden away in your records, you should do the same to the insurance companies that give you free online quotes.

Every state has a Department or a Commissioner of Insurance. The office or officer is responsible for licensing companies. No-one can underwrite without a license. Even when they have license, companies are regulated. Every state runs a complaint scheme so that if you have any kind of problem, you can send details to the local department or Commissioner. If it looks a good case, there are powers to investigate. Should evidence of a crime emerge, the state will prosecute and get you compensation. Most states publish a list of the companies licensed to trade and the number of valid complaints they have received.

You should also ask around your friends and colleagues to see what experience they have. There are also a number of consumer sites where people leave comments – usually bad because people get all fired up when they feel hard done by and want everyone else to know about it. If you have time, it is also worth talking to your local body shops to find out which companies have a good reputation for handling claims and paying out quickly for repairs.

Look at it this way. If you don’t ask, they won’t tell.

Now shop around. There are likely more than a hundred insurers licensed to sell policies in your state. Some are more expensive than others. If you must have the biggest and best policy from the top branded insurer, remember how much of your premium goes into paying for the advertising that made it a top brand. There can be differences of several hundred dollars between quotes. Never ever settle a big financial deal on the basis of one quote. With internet sites able to give you free online quotes from multiple insurers, get as many quotes as you possibly can before making up your mind.

When you’ve found a good company and their terms give you the cover you need at a price you can afford, buy the policy. But always remember to tell your current insurer you are changing. There is no point in having two policies in force at the same time. Equally, it’s a crime to drive on the roads without a valid policy. So make sure the changeover goes smoothly.

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