Shop around, and don’t ignore smaller insurers you might not have heard as much about.

Most of us need car insurance, yet few of us fully understand it.

Dozens of car insurance companies, including large players and regional insurers, are vying for your business. Many offer an eye-glazing assortment of policy options, making it hard to compare policies and figure out what’s the best and cheapest car insurance.

Here are eight things you can do to ensure you get good coverage at the best possible rate.

1. Don’t assume any one company is the cheapest

Some companies spend a lot of money on commercials that try to convince you they offer the lowest car insurance rates. But prices that different people pay for the same coverage by the same company can vary widely. No single insurer can claim to be the low-price leader for everyone. The insurance company that’s cheapest for one person in one place might be the most expensive option for a driver in another state.

The only way to ensure you’re getting the best deal is to shop around.

The only way to ensure you’re getting the best deal is to shop around.

There are some savings at stake: A NerdWallet analysis found that good drivers could be missing out on $416 a year on average by not comparing insurance prices.

Our study also found that 38% of Americans who have car insurance haven’t compared insurance costs in at least three years, if ever.

2. Don’t ignore local and regional insurers

Just four companies control nearly half the nation’s auto insurance business: Allstate, Geico, Progressive and State Farm. But smaller, regional insurers such as Auto-Owners Insurance and Erie Insurance often have higher customer satisfaction ratings than the big names — and they may have lower rates, too.

3. Check for discounts

Insurers provide a variety of discounts, including price breaks for customers who:

  • Bundle car insurance with other policies, such as homeowners insurance
  • Insure multiple cars with one policy
  • Have a clean driving record
  • Pay their entire annual or six-month premium at once
  • Agree to receive documents online
  • Own a car with certain anti-theft or safety features
  • Are members of particular professional organizations or affiliate groups

Don’t be swayed, however, by a long list of possible discounts. Compare your final prices from multiple insurers.

4. Pay your bills on time

Your credit score is a significant factor in the car insurance quotes you receive — except in California, Hawaii and Massachusetts, which don’t allow insurers to consider credit when setting rates. Insurance companies say customers’ credit has been shown to correlate with their chances of filing claims.

A NerdWallet analysis found that having poor credit can boost people’s car insurance rates by hundreds of dollars a year compared with having good credit.

Improve your credit — and get cheaper insurance — by paying your bills on time and reducing your debt. Track your progress by checking your credit score regularly.

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