Crash course on options for car insurance in Minnesota

If you have not shopped around for a better auto insurance rate, you should. Like, now.

Nonprofit consumer group Twin Cities Consumers' Checkbook magazine and Checkbook.org compared prices charged by the Twin Cities area's largest auto insurers and found that most area drivers will save $500 or more a year by making a better auto insurance choice. Many will save $1,000 or more. For the next month, Checkbook is offering free access to its ratings of auto insurance companies to StarTribune readers at: checkbook.org/StarTribune/auto-insurance.

Here are the types of savings Checkbook found are available to most area families:

• For a typical policy, a couple with two cars living in suburban Ramsey County with clean driving records would pay $808 with Progressive; $921 with Geico; $1,076 with Travelers; or $1,101 with USAA, compared with $1,654 with State Farm, the state's largest insurer, and more than $2,000 with Allstate, MetLife, and Encompass.

• If that couple has a less-than-perfect driving record (two speeding tickets in the past year), they would pay $1,076 with Progressive, $1,280 with Western National, or $1,438 with Amica, compared with more than $3,000 with AAA/Auto Club, Encompass, and MetLife.

• If they needed to add a teenage son to their policy, they would pay $1,456 with Geico, $1,526 with Progressive, or $1,783 with American Family, compared with $3,308 with State Farm and more than $5,000 with Allstate, Encompass, Esurance, and MetLife.

Although it's a bit of a pain to shop for auto insurance, most consumers would agree that spending a few hours to save $500, $1,000, or more every year is worth the effort. Note that you don't have to wait until your current policy term expires — when you switch to a lower-priced company, your old insurance company will refund the unused share of your premium.

You might think that if you have been driving for many years without an accident and with few speeding tickets that insurance companies will offer you their best rates. Unfortunately, that's not necessarily the case. Insurers increasingly are offering their best rates only to customers who meet criteria that have nothing to do with their driving histories. For example, most companies offer their lowest rates only to customers with excellent credit scores and who are college graduates and homeowners. And companies are increasingly using secretive and opaque methods to calculate rates.

The appropriateness of using credit histories and other similar data in setting insurance rates is a hotly debated topic. Companies clearly charge far higher rates to customers with poor credit scores than they do for people with good scores. Checkbook found, for example, that for one driver profile that it looked at of a 38-year-old female driver with "excellent" credit, she would pay, on average, a whopping $1,926 more per year if she had a "fair" credit score. Compare that with the additional $624 penalty for having a recent at-fault accident or the $739 penalty for having two recent speeding tickets.

Checkbook's comparison tool will help many families identify the lowest-cost companies for them, but because Checkbook found that small differences in policyholder characteristics, many of which have nothing to do with driving records, can have big effects on some companies' premiums, be sure to check rates yourself.

You want to buy enough coverage to protect yourself — but not so much that you are wasting money. Avoid common car-insurance mistakes by doing the following:

• Make sure you maintain the highest deductible amount with which you are comfortable.

• Consider dropping collision coverage when your car's value drops below $3,000 or so.

• When shopping for coverage, find out how much more it will cost to raise limits beyond standard coverages. It is usually inexpensive to increase limits for liability coverage above standard amounts.

• Carefully consider the extras. Some optional coverages aren't worth much, but companies charge a lot for them.

• For repairs, insist on using a repair shop you can trust — as long as it charges reasonable rates. At Checkbook.org, you will also find ratings of area auto body shops for quality and price.