Why I Pay More Than Necessary for My Car Insurance

by Christy Bieber | Updated April 5, 2022 - First published on July 28, 2021

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A man looking under the hood of his car on the side of the road with a dog in the passenger's seat.

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The reasons may surprise you.

For many purchases I make, my focus is on saving as much money as possible. But that's not the case for car insurance. In fact, I actually pay much higher premiums for my auto insurance coverage than I need to.

There are two important reasons why that's the case.

1. I have more than the minimum coverage

When figuring out how much car insurance coverage I need, it's important to note that the state where I live doesn't impose too many requirements. As a result, if I bought only the minimum car insurance coverage protection that my state mandates, I would have very little coverage -- but very affordable premiums.

I opt not to do that. Instead of just buying the minimum required coverage, I buy additional protection that isn't required at all, such as collision and comprehensive insurance. I've also set the maximum coverage limits on my policy at well above the amount my state requires. That means I have more types of coverage than required and my insurer could potentially pay out more money for each covered event.

I do this because I would rather pay extra premiums to protect my assets and transfer the risk of big financial losses to my car insurance company.

2. I prioritize customer service over affordable premiums

There's another important reason why I pay a higher-than-necessary price for my auto insurance premiums. I shopped around and got multiple auto insurance quotes before buying coverage, but I opted not to choose the cheapest car insurance company to buy my policy from. That's because the insurer offering me the lowest rates didn't have a good reputation for customer service or for efficient claims handling.

I've been involved in auto accidents before, and my insurance has fought on my behalf to help make sure the other driver was held responsible. That way, I didn't face unnecessary out-of-pocket losses. I know that when you are involved in a crash, it's crucial to have an insurer that has a reputation for taking care of its customers.

My insurance company also made it really easy for me to get a rental car after the accident and was quick in cutting a check to buy a replacement vehicle. It also paid a fair price for my totaled car.

When motorists are involved in a crash, the aftermath of the accident can be a really stressful time. I don't ever want to find myself fighting with an insurance company or waiting months to get my repairs or replacement vehicle so I can get back on the road. As a result, it is absolutely worth it for me to pay higher premiums to get a policy from an insurer with a top-notch reputation rather than one that has a history of not taking good care of its customers.

The bottom line is there are some situations where it makes sense to shop by price alone -- but I don't believe buying auto insurance is one of them. This insurance provides important protection from losses that can occur in difficult situations. It's worth it to me to make sure that I have the best possible protection for myself and my assets in case something goes wrong.

RELATED: See The Ascent's guides to the best cheap car insurance and best car insurance companies.

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