Reviewed by Daniel Mirkovic
Updated July 30, 2024 | Published August 17, 2020
Noun
quote | ˈkwōt
Definition: The insurer’s estimate of the premiums for a specific insurance policy before the policy is purchased.
Robert was happy with the quote he received from the first insurance company he contacted.
The important points
An insurance quote is an estimate from an insurance company of how much a new insurance policy will cost.
Insurance quotes include details about which coverages would be offered if the customer were to go ahead with the purchase.
Customers can get insurance quotes using online systems, contacting the insurance company directly, or through an insurance broker.
It’s standard practice to get several different insurance quotes when shopping for a new policy and choose the quote that fits your situation best.
Insurance quotes do not affect your credit rating.
A quote is an insurance company’s estimate of what they would charge for issuing a new policy.
Gathering quotes from one or more insurance providers (or insurers) is the first step in buying a new insurance policy. Each quote will tell you how much each company will charge you for a new policy, and what the coverage will look like if you decide to buy.
When you approach an insurance provider for a new quote, they’ll ask you for some details about yourself and the property you want to insure. Each quote is customized for the person buying it. If you’re looking for a home insurance quote, for example, the insurance company will ask about your home, where it’s located, what kind of plumbing system it has, what the roof is made of, and so forth. Each of these details is a factor in the purchase price of the policy, so the insurance company needs to know to issue an accurate quote.
The quote process is also when the customer decides what kinds of coverage they want in their new policy. Coverage selections influence the quoted price.
Not every insurance provider’s quote process is the same. Each insurance company has their own factors for determining premiums, so they’ll ask different questions during the quoting process. As well, not every insurer offers the same coverages, so you may get different options depending on which insurance company you’re getting a quote from.
Once you’ve made your coverage selections and provided the necessary information, the insurance company will issue you a quote.
The key piece of information on the quote is, of course, the price. However, your insurance quote also tells you what coverage that insurance company is including for that price.
If you like what you see on the quote, you can move forward with the process and tell the insurance company you’d like to buy the policy. You aren’t obligated to do so, however; it’s normal to get quotes from several different insurance companies, but you’re only going to end up buying from one.
Once you’ve decided to buy a policy, pretty much all that’s left is to make your first premium payment. However, in some cases, the insurance company will ask for some additional information before they issue your new policy. They may want photos of your house, or perhaps appraisal documents for a pricey piece of jewellery. In some cases, they may agree to start coverage right away through a binder and collect the other information afterwards. Sometimes, like when you’re closing on a new home, you need insurance coverage quickly and don’t have time to wait for a jewellery appraisal.
The quoted price usually is very close to the final cost of the policy, but it’s not always identical. The insurance company may adjust the final price based on the extra information they collect from you after you’ve decided to buy the quoted policy.
Getting an insurance quote for your home is straightforward.
Many home insurers (like Square One) have online systems from which you can get a home insurance quote. If you prefer a more human touch, you can contact the insurance company directly and speak with an insurance agent.
You can also get insurance quotes through an independent broker. A broker will first collect your information, then take that information and get quotes from multiple insurance companies on your behalf. Buying insurance through a broker can be convenient, but many people prefer to deal with their insurance provider directly.
Whichever approach you take, all you’ll need to do is give the insurance company the information they ask for, and they’ll issue you a quote.
Typically, this is a speedy process. Using Square One’s online quote system, you can get a quote for your home insurance in less than 5 minutes. It may take longer if you go through a broker, or if the insurance company needs information that you don’t have at the ready.
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When you’re in the market for a new insurance policy, it’s best to collect several quotes before you decide. Having quotes from 3 to 6 different insurance providers is enough to be confident that you’re getting the best offer you can.
Of course, if you’re entirely satisfied with the first quote you get, there’s nothing wrong with going for it.
When deciding between multiple quotes, most insurance customers focus only on the price. Price is certainly an important factor—you want to make sure you’re getting a fair deal—but make sure to analyze the coverage offered by each quote, too.
If one policy costs $10 more than another, but offers double the coverage, you may want to spend the extra $10. Or, perhaps the more expensive policy already includes coverage against a big-ticket peril – like earthquake, for example – unlike a less expensive policy that only offers earthquake as an optional add-on.
If any of your quotes make it hard to understand what coverage they’re offering, that is also a factor to consider. Insurance policies don’t have to be hard to understand! You might feel more comfortable choosing a quote from an insurer that makes their coverages and exclusions easy to understand.
After all, buying an insurance policy isn’t like buying a jug of milk; you’re starting a long-term relationship with your new insurance provider. It’s worth finding one that you trust.
On the same note, consider your experience of getting each quote. Was the insurance company’s website transparent and full of easy-to-understand information, or did you have to dig to find things? Was their online quote system easy to use? If you spoke with an agent, were you satisfied with their customer service? Positive answers to these questions might point you to an insurance provider that you’ll have a good relationship with.
There’s a common misconception that getting insurance quotes can harm your credit rating.
Many insurers will run a credit check as part of the quote process. However, these checks are soft credit checks, which means they do not affect your credit rating.
Looking for another insurance definition? Look it up in The Insurance Glossary, home to dozens of easy-to-follow definitions for the most common insurance terms. Or, get an online quote in under 5 minutes and find out how affordable personalized home insurance can be.
About the expert: Daniel Mirkovic
A co-founder of Square One with 25 years of experience in the insurance industry, Daniel was previously vice president of the insurance and travel divisions at the British Columbia Automobile Association. Daniel has a bachelor of commerce and a Master of Business Administration (MBA) from the Sauder School of Business at the University of British Columbia. He holds a Canadian Accredited Insurance Broker (CAIB) designation and a general insurance license level 3 in BC, Alberta, Saskatchewan, Manitoba and Ontario.
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