Have you ever been victimized by highly priced auto insurance? In actuality, there are a great number of car owners who feel imprisoned and distressed by their auto insurance policy. Large firms promote their brand names with decorative ads and it is quite daunting if not impractical to just ignore the jazzy advertisements and find the best price available.
Behind these jazzy lines, hidden is truth, yes you can save on auto insurance. There are a few proven ways to reduce your premium.
If 15 minutes can’t save you 15% or more, 15 days sure can. Just be prepared.
Intelligent people really take the time to properly compare rates at least once or twice annually since prices decline sometimes.
In line with this, just because you had the best rate two years ago from your insurer doesn’t mean they still offer the cheapest rate. Other insurers might now be less expensive. So, shop around and lower your insurance.
Indeed, while it is true that competing auto insurance firms provide opportunities for great discounts, people can also take significant steps prior to purchasing a car to ensure that they will pay the least premiums.
There are few articles already written to reduce auto insurance premium, and I’ll mention those as I go explaining the points.
If you like the advice I have given here, do leave your comments below. Let’s get started with ways to lower your insurance premium.
Here are some of the tricks on how to reduce your auto insurance premium
I Was going through price comparison for our auto insurance. Didn’t find a cheaper insurer than our current one. Sometimes the use of technology can also bring down your insurance premium. Here’s a list of to-do’s you can follow.
1. Compare rates for different cars
By the time you have already identified about two or three vehicles which you think you can afford and will certainly meet your needs, you can phone your present insurance or a new insurance firm to compare premiums for the vehicles.
What I did when I bought my new car was I price comparison tool to search for the lowest premium.
These tools will send your request to multiple providers so your chance of getting the lowest quote possible, increase. This is a really cool tool to have, I’ll highly recommend you to use such tools before fixing a vehicle to buy.
There will not be any credit check to see the quote, you don’t even have to put your SSN number.
Take into consideration that auto insurance costs differ due to the reality that the repair costs, safety record, the price of the car and the possibility of theft are highly considered.
You may also work with an insurance agent for quotes on different vehicle model and make.
Competition is good for us. You make sure insurance companies compete against each other. The moment you get a lower quote from elsewhere, try to talk to the agent to counter the offer. Do this till insurance companies run out of options and give up. Then, you pick the lowest quote and get insured.
2. Refrain from gaps in coverage
In the event that you are swapping policies, ensure that you are totally covered all the time.
If you allow your insurance coverage to expire by forgetting to make the timely premium payments, consider the fact that your rates can possibly go up.
Read here, how gaps in auto insurance coverage affect the insurance rate.
You may be considered a “high-risk driver” if you’ve let your coverage lapse or if you were driving and/or in an accident while uninsured. Do not leave a gap in your coverage.
3. See to it to sustain a good credit
Insurance firms commonly check your credit score when identifying the rates of your insurance mainly because they have figured out a correlation amidst bad credit and the potentiality of making a claim.
Studies have shown people with excellent credit are less likely to make a claim and opposite for people with bad credit score. Read more about credit score and auto insurance here.
4. Try to drive less
Yes, I know this is easier said than done. Some of you might think I am insane. But, several insurers offer a low-mileage discount for those drivers that only drive a few miles or have a short commute every year.
Especially the distance you cover to go to work. The lower amount you mention the lower quote you’ll receive.
Almost every insurer asks for the distance between your home and workplace. Do not over-estimate the distance for any reason, that’ll go against you.
5. Go for a high deductible
In reality, one of the highly regarded as the easiest approach to lower your auto insurance is to increase your deductible. This means that you have to be certain that you have necessary funds to pay the deductible if you get into an accident.
In our case, we have $1,000 deductible on collision and comprehensive coverage. We pay $760 for 6 months for our two cars. Which is very low, the most apparent reason behind that is our high deductible.
I did a check around the match. With $500 deductible, our 6 months premium was quoted at $890. So, we are saving $130 every 6 months by promising to pay $1000 out of pocket if we meet with an accident.
So we saved $130 every 6 months in a saving account and within 2 years we had more than $500 in a savings account. So now in the case of an accident, we know we have an extra $500 saved so we can pay the deductible quite comfortably.
Like the idea? You can implement this.
6. Consider requesting all your discounts
In case your car has additional safety or anti-theft features like anti-lock brakes, several insurance firms will offer you a great discount on your premiums. In the same way, you may also be qualified for a discount in the event that you have excellent grades as a student or have taken a defensive driving class.
These days insurers, like Statefarm, Progressive, etc. are giving a discount on monitoring devices installed in your car.
And, drivers across the country are opting for the monitoring device to save on auto insurance. This is based on a simple idea, safe drivers should pay less.
7. Consider driving safely
This is the biggest cost driver in the auto insurance industry. If you have prior driving faults or speeding tickets, you need to pay a higher premium, almost without fail.
Needless to say, you must drive responsibly and carefully in order to ward off tickets and accidents anyway; however, bad driving can also increase your insurance rates or may even result to non-renewal of your policy.
Due to the reality that higher speeding tickets can lead to some issues, causing an accident will commonly increase your insurance rates by as much as forty percent.
8. Consider moving
This may be slightly harsh; car insurance rates differ broadly from one location to another due to the possibility of a theft or an accident.
Car insurance rates are generally lower in provincial areas, so you wish to look into the potential for lower or higher insurance rates in case you are planning to move.
9. Try for combining insurances
After shopping around for insurance rates, try picking one insurer for all your insurance needs. Many insurers offer a discount for combining homeowners, car or renter’s insurances.
Make sure you know what are you getting into by combining different insurance under one insurer. Does it make sense to combine home and auto insurances?
10. Lower your coverage
It is helpful to know that the Insurance Information Institute recommends lowering comprehensive or collision insurance on older vehicles so to set aside some dollars. The rule that is wise to follow according to this institute states that in case your vehicle is worth less than ten times the premium; then, it is a smart move to lower the coverage.
For our vehicle, we have covered up to state stipulated minimum. Not even a dollar more than that. Allstate agent told me I couldn’t opt for less than 25,000/50,000 coverage limit. I looked up Florida state motor transport site, they had a minimum coverage of 10,000/20,000. I told Allstate, ‘No’.
11. Check group discount offer
My employer has a discounted rental car and auto insurance provider in their list of employee benefits. But, the provider has a high rate so I didn’t go with them.
Your case might be different. You may get the cheapest price by going with the insurer your employer has a tie-up with.
Sometimes being a member of a professional union or club can earn you special discounts.
12. Improve Your credit score
Believe it or not, many insurers give discounts to people with high credit scores. People with high scores are regarded as more responsible, even while driving.
Also, they are most likely to pay the premium on time.
As per Esurance, insurance companies use credit score for insurance purposes to determine driver’s risk. 92% of insurance companies use credit score to determine your premium,
13. Pay a One-time Premium
My insurer charges $3 for each installment of payment. I pay once every 6 months to avoid this fee. If you set up a monthly installment payment, every month you’ll pay $3 extra.
The exact amount varies between insurers but, almost certainly they have a charge for paying in installment.
14. Ask Friends & Check Reviews
The internet not only makes us distant from each other, but it also brings us closer together. So, why not use this new-found intimacy to save money on your car insurance?
After all, asking your friends who they use for car insurance and how much they pay might not be the most exciting conversation you have ever had but it might be the most profitable.
Besides asking your friends who they recommend, you can also go online to check reviews.
Doing so will help you to find out more about the company’s service and while this might not directly save you money, you don’t want to get a cheap policy from a company with poor service reviews as this will end up costing you more money over the long run.
A Valuable Note
Car insurances help the vehicle owner to be prepared for the unanticipated or unexpected events and definitely shield you against losses. More than that, there is diverse car insurance policies ready for use such as comprehensive policies which consisted of theft and fire policy as well as a third-party policy.
It is helpful to understand that third-party policies cover injuries and damages which are caused by you to other individual’s cars; meanwhile, theft and fire policy offer protection against your very own losses. The most crucial factor to recognize is that auto insurance must be fully customized to fulfill your needs.
Prior to buying any insurance policy, see to it that you go over the product disclosure statement first particularly because this reveals what your rights are.