How To Customize Your Car Insurance Policy

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A customized car insurance policy refers to changes you make to a base auto policy, which provides bare-level coverage that meets your state’s minimum insurance requirements. Customizing your policy can involve choosing your deductible, qualifying for discounts and adding optional coverages.

For more information on customizing your auto coverage, read our handy guide and get the protection you and your vehicle deserve.

Key Takeaways

  • Technically, you only need a policy that meets your state’s minimum insurance requirements but this can leave gaps in your coverage.
  • Adding optional coverages and increasing your coverage limits will expand your protection but will also increase your premium.
  • When customizing your policy, you’ll want to consider factors like the type of car you drive, your vehicle’s age and your driving history.
  • Even with minimum liability policies, pricing can vary to account for different driving histories, ages and eligible discounts.
  • Adjusting your deductible is the most straightforward way to customize your policy, with a higher deductible resulting in a lower premium and vice versa.

Does a Customized Car Insurance Policy Cost More?

A minimum liability policy is the cheapest policy you can buy so customizing your policy with additional coverage add-ons will increase the cost. Increasing your limits will raise the price as well since a policy with $60,000 in liability coverage would cost more than a policy with only $30,000.

That said, customizing your policy can also result in a lower premium.

For example, different people may qualify for different car insurance discounts — a college student with good grades qualifies for a good student discount, while a senior driver may earn a discount for completing a defensive driving course. In addition, two drivers may have identical coverage but different deductibles, resulting in the driver who chose the higher deductible paying a lower monthly premium.

How Do I Customize My Car Insurance Policy?

We've provided steps you can use to buy customized auto insurance that fits your needs.

1. Choose Your Premium and Deductible

Your premium and deductible are linked. If you opt for a lower premium, your deductible will likely be higher, and vice versa. Those with good driving histories may want to go for a smaller premium. If you’re more accident-prone, a lower deductible may be a wiser choice.

monthly costs and deductible line graph

2. Bundle Your Coverage

Bundling refers to a discount your insurance company gives you for having an auto policy and a homeowners/renters policy and is one of the easiest ways to save. Some insurance companies even offer a discount of up to 25% on your car insurance premium.[1]

3. Take Advantage of Other Discounts

Along with bundling, there are a plethora of discounts that many providers offer their customers. The below list will give you a good idea of what to ask an insurance agent about when insuring your car.

Anti-theft discount

Military/Veteran discount

Automatic payment discount

Multi-car discount

Defensive driving discount

New vehicle discount

Distant student discount

Organizational discount

Good driver discount

Paperless discount

Good student discount

Pay-in-full discount

Low-mileage discount

Profession-based discount

Loyalty discount

Telematics discount

common car insurance discounts infographic

4. Consider Add-Ons

Various additional car insurance coverage options are available for your standard auto insurance policy that will help bolster your protection, including:

  • Collision insurance: Not legally required but often required by lenders, this first-party benefit pays for your car's repair or replacement after an accident, irrespective of fault.
  • Comprehensive insurance: This insurance covers physical, non-collision damages to your vehicle from perils like fires, natural disasters or vandalism. Similar to collision insurance, this coverage is not legally required but is usually required if you have a car loan.
  • Medical payments (MedPay) insurance: Medical or funeral expenses are covered for you or your passengers, regardless of fault. Some states require this coverage.
  • Personal injury protection (PIP) insurance: This coverage provides broader financial support than MedPay, including lost income and childcare costs. Some states require PIP.
  • Uninsured/underinsured insurance: You’re protected if you’re hit by someone without adequate insurance. Some states require this coverage.
  • Emergency roadside assistance insurance: Financial aid is given for things like towing, fuel delivery and locksmith services.
  • Original equipment manufacturer (OEM) insurance: Ensures replacement parts used for repairs come directly from the vehicle's original manufacturer.
  • Accident forgiveness insurance: Prevents your premium from increasing after your first at-fault accident.
  • Gap insurance (lease/loan protection): Covers the difference between your car loan balance and the vehicle's actual cash value if totaled. Without gap coverage, you'd be responsible for paying out-of-pocket if your loan exceeds the depreciated value of the car. This coverage is recommended for newly purchased cars.
  • Rental car insurance: Provides coverage for rental vehicles in four key areas: liability for at-fault accidents, damage waivers for car issues, personal accident insurance and protection for stolen belongings. This insurance is a good investment if your personal auto policy doesn't apply to rentals.
  • Commercial auto insurance: Covers vehicles used for business activities and offers liability and other state-mandated coverages. Optional add-ons like physical damage protection can be included for an additional cost.
  • Rideshare insurance: Fills coverage gaps that occur when a rideshare company's commercial insurance isn't in effect. It can offer a range of protections including bodily injury, property damage liability, medical expenses and even optional features like comprehensive coverage and roadside assistance.
  • Classic car insurance: Offers standard coverages like liability and collision, but can also include unique features such as spare parts coverage. Unlike typical auto policies that use standard depreciation, classic car insurance acknowledges the vehicle's rarity and difficulty in being replaced by insuring it based on a mutually agreed value.
  • New car replacement insurance: Provides funds to purchase a new, identical vehicle if your current one is declared a total loss. This payout covers the cost of the new car, minus your deductible.
  • Road trip accident accommodations insurance: Helps with the cost of food, lodging and alternate transportation if the insured vehicle is put out of commission due to an accident.

It's worth noting that some states utilize what's called a no-fault system, meaning each driver pays for their own damages regardless of fault. Those living in Kentucky, New Jersey and Pennsylvania have the option of participating in a no-fault system. However, if they choose to be held to a tort system wherein drivers can seek reparations for damages caused by other drivers, they'll need to decide between full tort or limited tort insurance.

Full tort allows unrestricted rights to sue for economic (medical bills and lost wages) and non-economic damages (pain and suffering) if an accident occurs. Limited tort is generally cheaper but restricts your ability to sue for non-economic damages.

Other Things To Consider When Customizing Your Car Insurance Policy

If you frequently travel with your pets, adding pet coverage to your customized auto insurance policy is something to consider, covering medical expenses for your dog or cat if you're involved in an accident. Accidental death and dismemberment is another option, providing financial benefits if you're seriously injured or killed in a car accident or other major event.

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Can I change my auto insurance policy at any time?

You can make changes to your current policy at any time during the year by contacting your provider and letting them know what you'd like done. Keep in mind that changes will most likely affect your costs.

Do I need comprehensive and collision coverage?

Comprehensive and collision coverage are not required by state law on a regular auto policy. However, they may be required by a lender or lessor if you're financing or leasing a car.

What types of car insurance are mandatory?

Most states require a standard auto policy to include liability coverage. Others may also require MedPay, PIP and/or uninsured/underinsured motorist coverage.

Will my car insurance cover my trailer?

The liability portion of your auto insurance will usually extend to your travel trailer. However, you'll likely need to purchase a separate RV policy to get additional coverage such as comprehensive or collision.


  1. Allstate. “Bundling Online and Saving Money Go Hand in Hand.” Accessed August 31, 2023.

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