What Is An Insurance Quote? – Simply Explained

An insurance quote is an estimate of how much you need to pay for purchasing a particular insurance policy. It is calculated with the help of your personal information related to the policy.  

Going through the insurance application process but can’t figure out What is an insurance quote? 

Well, then this post is for you. Because here I’ll simply explain what is a quote in insurance. Difference between quote and policy in insurance, How to get an insurance quote, and all the related queries.

What Is An Insurance Quote?

An insurance quote is an approximate of what your insurance premiums will be for a certain type of insurance policy. It is not a legally binding contract.  

When you are shopping for insurance, the insurance application asks for some personal information related to the insurance. For example, for life insurance, an insurance company will ask for your health history and some essential insurance. 

After getting all the information needed the insurance provider calculates an estimated sum for you. It is known as life insurance quotes. You have to pay close to that estimated amount to purchase that policy. It includes

  • The premiums you will pay  
  • The deductible you will have to pay for each claim.
  • The limits of the coverage

However, insurance quotes are estimated sums. So, you might need to pay slightly more for getting a policy. But are insurance quotes and policies the same? 

No, let’s look at the difference between them. 

Difference Between Quote And Policy In Insurance 

The below chart will provide a fine idea about the difference between insurance quotes and insurance policies

Insurance QuoteInsurance Policy
An insurance quote is an estimate of what you will pay for insurance premiumsAn insurance policy is a contract between you and your insurance company
It is not a legally binding contract.It is a legally binding contract.
It does not guarantee any coverageIt guarantees coverage for any damage. 
It provides an estimation of premiums, coverage limits, and deductibles.It specifically outlines the details about the premiums, limits, deductibles, coverage, and terms and conditions of the insurance.
You can walk out of it and no insurance company will penalize you. You can walk out of it however, your insurance company can penalize you.
Acquiring an insurance quote process is easy and fast. Getting a policy can be lengthy.

By now you have an idea of what is a insurance quote. So, now let’s look at how to get one. 

How To Get An Insurance Quote 

To get an insurance quote you can go to any insurance company’s website, fill up the information needed and submit it and you will get one within a short while. Moreover, you can contact an insurance agent, provide details and get it.

Getting insurance quotes is a fairly easy process and it costs nothing. You can get it both online and manually. To get a quote, you will need to provide some information. The information might vary depending on which insurance you are getting. 

Here are some of the details you will need

For Home Insurance Quote 

  1. Your personal details
  2. Condition of your house
  3. Amenities
  4. Previous renovations and repairs.

Find more about homeowners insurance

For Renters Insurance Quote

  1. Your personal details
  2. Your belongings 
  3. Number of rooms 

For Car insurance

  1. Personal information 
  2. Driving History 
  3. Previous tickets and 
  4. Any Accidental History 

Find more details about car insurance

For Life Insurance

  1. Your personal information
  2. Income
  3. Assets
  4. Health history  

The personal information will include your name, address, credit history, social security number, and email address.

Provide the above details to the insurance company website or an insurance agent to acquire a quote. It’s completely free.   

But if you want multiple quotes then provide the above insurance to your insurance broker, he or she will bring you multiple quotes from different companies. However, it will cost you some fees.

But should you get multiple?

Why Is It Recommended You Get Multiple Quotes Before You Buy Insurance?

You should compare quotes from different insurance companies. This will help you choose a policy that provides the best deal and saves money.   

When you are shopping for insurance, you will want to get quotes from several insurance companies. This will give you a good idea of what the premiums are, the coverage options, and the deductibles. By doing this you will get the most custom-tailored insurance policy for your particular insurance needs. 

For example when you are getting full coverage car insurance or hurricane insurance you should get multiple auto insurance quotes. By doing this you can get the most value for money coverage at the same time you can protect your car and house better.

Be sure to ask the insurance company questions about the policy so that you understand what you are buying. 

However, insurance companies check your credit score. So, can it hurt your credit score?  

Does Getting An Insurance Quote Hurt Your Credit Score?

No, getting an insurance quote does not hurt your credit score. Because insurance companies do a soft pull on your credit which does not affect the credit score. 

Insurance companies check your credit score when you request quotes. But it does not hurt your credit. Because they can only soft pull or get a basic idea of your credit score. This is similar to a personal credit check. So, it won’t hurt your credit score in any way.

In Summary 

Insurance quotes are just an estimated price of an insurance policy you intend to buy. It’s important to get an insurance quote before purchasing any insurance plan because you don’t want to get surprised by high deductibles or coverage limits when your insurance claim. 

Lastly, if you are having trouble understanding a quote talk to insurance agents.


Please share this post if you like it.

Leave a Comment