Buying car insurance is an essential part of owning or leasing a car. It’s illegal to drive without it in most states. Even if it’s optional, it’s foolish to be on the road while uninsured. Though you have to buy auto insurance, it’s a product that you hope never to use.
Like many products and services these days, you can choose to buy car insurance in multiple ways. You can research and buy it online directly through the insurance company, online through a service that offers quotes from several insurers, in person from an agent who sells for just one insurance company, or in person from an independent agent who represents multiple companies.
The decision of whether to buy online or from a local agent comes with pros and cons for each. In this guide, we’ll explore the decision in detail.
Pros of Buying Online
Using your keyboard to help you find and buy insurance has several advantages, here are a few.
You Can Do It 24/7
While it’s a bad idea to walk into an insurance agency in your pajamas, you can shop for insurance online at any time, day or night, weekday or weekend. There’s no need to take time off from your day job to find and buy auto coverage.
Skipping the Agent
By working directly with an insurance company, you can avoid having an agent acting between you and the insurer. The agent needs to be compensated, and their brick-and-mortar locations cost money to operate. Those costs will be built into the price of your insurance policy.
There Are Many Ways To Buy
There’s more than one way to research and buy insurance online. You can go straight to an insurance company's website, or you can use an online service that explorers the offerings of multiple insurers to help you find the best policy to meet your needs and budget.
U.S. News partner QuoteWizard can connect you with several local insurance agents, providing a blend of online and personal service.
It's Easy to Get Your Documents
When you purchase auto insurance online, you can quickly print out your policy documents. That really comes in handy if you're shopping for a new car on the weekend and need to show a dealer you have proof of insurance before you can drive your new car home.
Get Multiple Quotes at the Same Time
Shopping at brick and mortar insurance agencies and companies requires you to send your information to each one individually. Many online companies allow you to get multiple offers with just one application. That can save you a tremendous amount of time, as there's quite a lot of personal information that needs to be provided before a company can produce an accurate quote.
Potentially Money Saving
Because online sites don’t have the overhead costs that a brick and mortar agency does, and internet-direct insurers don’t have to pay commission, there’s a good chance you can save a significant amount of money when you buy your auto insurance online. Of course, there's no guarantee that buying one way or the other is more affordable.
There’s No Pressure
When you are face-to-face with an insurance agent, there’s likely to be at least some implied pressure to buy, if not totally overt pressure. Of course, you can always walk away. When you’re shopping online, you won’t have the same pressure. You can decide to take an offer immediately, mull it over, or walk away and look for other deals. You can also take any online offers to other insurers to see if they can meet or beat the prices or coverages.
Cons of Buying Online
Getting auto insurance quotes and buying coverage online isn’t always the best way to shop. Here are some issues with online car insurance shopping.
It's Hard to Find a Human
With most online car insurance portals, you'll enter your information into forms and get responses on your screen or in an email. In most cases, you'll never talk to a human during the process of building an auto insurance policy. That’s fine if your policy is straightforward, but if you have any questions or issues, not having a personal contact can be a problem.
Even if you can reach a customer service representative, you'll have no idea of their level of expertise, licensing, or ability to accurately answer your questions. In most cases, you'll talk to a different person every time you speak to the customer service department.
It's Hard to Explain Your Personal Circumstances
When your policy needs are not straightforward, or you need some extra hand-holding through the process of researching and buying insurance, an online insurer may not be the best choice. Most online portals use the information you provide, your credit score, and information about your driving record to kick out an automated estimated premium. Not every consumer fits into their neatly constructed categories. If you’re one of them, you should talk directly to an agent.
You Need to Know Your Stuff
Getting the right coverages can be complicated. Different states require different levels of liability coverage and various lenders and leasing companies have varying requirements for collision and comprehensive coverage. You’ll need to know all of those details before you attempt to buy insurance online. Failure to do so can leave you paying for coverage you don’t need or not purchasing coverage that's required.
Most consumers will need liability coverage, comprehensive coverage, collision coverage, and uninsured motorist coverage. Some will also need or want gap coverage to protect their finances if the amount they owe on their loan or lease can’t be covered by their collision or comprehensive insurance.
Visit our Auto Insurance hub to learn more about the insurance coverage you’ll want to purchase.
It Can Be Harder to Bundle
One of the best ways to get a discount on insurance is to bundle your auto, homeowners, renters, and even life insurance with the same insurance company. Even bundling all of the vehicles in your household into a multi-car policy can save you money.
When you buy insurance online, however, bundling your various policies together can be significantly more complicated. You’ll need to become familiar with the ins and out of each type of policy, plus the limits you need to meet with each kind of insurance. You will also need to find an insurance company that performs well for each type of coverage.
You Have to Provide a Lot of Personal Information
It's not a good idea to use a public computer or an insecure Wi-Fi connection when you are sharing personal data.
Some Quotes Are Just Estimates
It is essential to know whether any online car insurance quotes you received are legally binding offers of insurance for that price or estimates that are subject to further underwriting before an exact price is given. You can get into trouble if you assume that the estimate was an actual price and cancel your old policy.
You might have to dive deep into the website’s fine print to find the answer to this question.
Pros of Buying in Person
Buying straight from an insurance agent used to be the only avenue to getting auto insurance. There are still many benefits to using this avenue to get car insurance quotes and buy your auto insurance.
Captive Agents vs. Independent Agents
There are two primary types of insurance agents. Captive agents work directly for a single insurance company. They can also work for a franchise rather than directly for the company, but they still only represent one insurance company. You can tell if someone is a captive agent by the company branding on their offices, websites, or other marketing materials.
Independent insurance brokers or agents sell policies from many different companies. Some insurance carriers they represent may only offer a specific line of coverage, such as life insurance, while others offer a wide variety of policies. Independent agents typically work for a commission.
You Have a Knowledgeable Guide
When it’s time to trek into the complex jungle of insurance, a knowledgeable guide can help you find the perfect coverage and car insurance discounts you may not realize you’re entitled to. An insurance agent can be that guide. Not only do they know the questions to ask to find you the best policy, but they’ll also understand the local car insurance requirements. Insurance comes with its own vocabulary, and experienced auto insurance agents can guide you through the complex terms and contracts you’ll be asked to sign.
In most states, insurance agents are licensed. Though the requirements for licensing are different in each state, in most cases, agents are subject to training courses, exams, fingerprinting, and background checks.
You’ll Have a Human Connection
When you get a quote online or buy your insurance from a website, you’ll probably never talk to a human. Buying from an agent allows you to create a partnership with someone. You can speak in-person about any issues you might have, such as accidents that you caused that could make an insurance company classify you as a high-risk customer, or plans to use your car for ride-hailing (such as Uber) or rideshare (like Turo) endeavors.
An Independent Agent Can Look at Several Companies
If you opt for an independent agent, they can cross-shop multiple auto insurance companies on your behalf. A good broker will likely know which ones best fit your needs and offer the best discounts before they even start submitting applications to different insurers. The best part: You'll only have to provide your personal information once, and they'll take it from there.
You Can Still Have Online Access
Even if you use an agent to help you get your auto insurance, most auto insurance companies will still provide online access to your account. From there, you can pay your premiums, print insurance cards, and initiate claims without waiting for your local agent's office to open.
Personal Help When You File a Claim
If you need help in filing a claim, you’ll have a person you can call for assistance. Though most large car insurance companies have claims specialists you’ll contact by phone or online, getting advice from your agent can be invaluable when it comes to looking at your options and minimizing out-of-pocket expenses.
It’s important to know that with some carriers, a call to your insurance agent about a potential claim can be counted by the insurer against your driving record – even if the damages weren’t even high enough to meet your deductible.
Easy to Bundle
A good insurance agent will know the pros and cons of all of the policies they sell. That makes it easy for them to bundle multiple coverages, including your homeowners, renters, and car insurance policy. They will also understand how to maximize any possible discounts on the multi-policy package.
It’s a Great Choice for First-Time Buyers
As we’ve mentioned a few times before, car insurance coverage can be complicated. That’s especially true if you’re a first-time car buyer or you’re leaving your parent’s auto insurance policy. Using an agent might be more expensive in the short run, but their knowledge and access to discounts may save you money in the long run. When it’s time to renew, you can use the figures on your policy’s declarations page to seek auto insurance quotes from other insurers.
Cons of Buying in Person
Getting car insurance quotes and buying from an agent doesn’t come without some issues. Here are a few you should consider.
You Have to Pay the Intermediary
An insurance agent, whether they’re captive or independent, is an intermediary between a policyholder and the insurance company. They are paid for their services, and that compensation will be part of the premium you pay, whether you see it or not. If you’re a new driver or need some additional help, the added cost may be worth it. On the other hand, if you’re a good driver who understands the discounts you qualify for, online car insurance companies may save you a significant amount of money.
You’re Limited to Business Hours
While you might find the occasional insurance agent with evening or weekend hours, most are only open during the day on weekdays. If you want to buy your insurance or have questions when the office is closed, you’re out of luck. Most insurance companies have toll-free telephone numbers for off-hours inquiries, but if you want to talk to your agent directly, you'll have to wait until the office is open.
You Won’t Necessarily Know How They Are Paid
Insurance agents are generally paid on commission. As a customer, you won't know which insurance company pays higher commissions and entices agents to push their products more. You won't know what bonuses they're striving for, or which special selling promotions are prompting them to sell products from certain companies.
In other words, sometimes you won’t know if they’re pushing the best auto insurance products for you, or for their bottom line. The longer your relationship with an agent, the less susceptible you’ll be to being pushed into any periodic promotions they are offered.
You May Get a Lot of Sales Pressure
Because insurance agents are on commission, you can face a lot of pressure to buy. It does take work on the agent’s part to put together car insurance quotes, so they’ll likely want their investment of time to pay off. When an insurance agent is pushing, it’s up to you to negotiate. While premiums may not be negotiable, perhaps you can get the agent to throw in roadside assistance or towing coverage to make the sale.
If you are uncomfortable with the pressure or you’re told they can only give you the price if you sign up immediately, it’s a red flag. You should walk away from any deal that you’re unsure of. You can always go back or look for another agent or insurance company.
There’s Another Option
Another way to buy insurance blends the benefits of buying online and through an agent. Some websites, including U.S. News partner QuoteWizard, will connect you to a number of local agents after you provide information about your auto insurance needs and location.
More Shopping Tools From U.S. News & World Report
The experts at U.S. News & World Report have decades of experience helping consumers navigate the car-buying journey. Our new car rankings and reviews and used car rankings and reviews are great places to start. Using the factors buyers tell us are critical to their purchase or lease decisions, we look at the consensus opinion of the nation’s best automotive journalists. We then blend in quantifiable data on predicted reliability and safety and rank nearly every vehicle you can buy against its peers. For used cars, we add cost of ownership into the math so you can be assured that the vehicle you purchase will stay affordable years down the road.
A significant cost of car-buying is the interest you pay on your auto loan. Smart buyers never head to the dealer until they have a pre-approved loan offer in place from a bank, credit union, or another lender. U.S. News partner myAutoLoan can quickly find you as many as four offers with one easy online application.
One great way to save money when buying or leasing is to take advantage of a car manufacturer’s incentive program. You’ll find the best cash back and financing offers on our new car deals page. Lease customers can find affordable offers on our lease deals page. If you can’t find any special offers, head over to the U.S. News Best Price Program. We work with local dealers to provide pre-negotiated pricing for both lease and purchase customers. Buyers save an average of more than $3,000 when they take advantage of the program.