• Home
  • About
  • Advertise
  • Contact
  • Policy
  • Guest Post
  • Archive

One Cent At A Time

A Personal finance blog to get rich

  • Email
  • Facebook
  • Pinterest
  • RSS
  • Twitter
  • Beautiful Life
  • Becoming Rich
  • Beginners Guide
  • Extra Income
  • Productivity
  • Saving Money

How to Lower Auto Insurance Premium

January 27, 2018 3 Comments

Share this:

  • Tweet
  • Email

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.

Auto Insurance

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.

Related – Car Insurance and Life Insurance – How to Get the Best Deals

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.

LIKE THIS POST?
I agree to have my personal information transfered to MailChimp ( more information )
Join our community of 8000+ subscribers to increase your net worth and build wealth
We hate spam. Your email address will not be sold or shared with anyone else.

Share this:

  • Tweet
  • Email
The tool that changed the way I manage my personal finance - Personal Capital, The Best Free Personal Finance Tool

Want to start a WordPress blog now? The onecentatatime.com blog is hosted by Siteground Web Hosting. For only $3.95 a month, Siteground can help you set up and host your website/blog quickly and easily.

About the Blogger Hi I am SB, a personal finance enthusiast with a career in software development. I am an immigrant to the USA since 2005, after being born and brought up in India. This 40 something technocrat lives and breathes personal finance whenever he gets time from the day job, job as a husband and a dad

Some links on this page may be affiliate links, if you make a purchase following the links, I may earn a commission. Read affiliate disclosure here
« Best Sentimental Valentine Gift Ideas for Husband
Why I Didn’t Invest in Bitcoins »

Comments

  1. Delores Lyon says

    December 2, 2015 at 5:47 PM

    Thank you for sharing all of these tips on lowering your car insurance rate! I had no idea that having a gap in coverage could raise your prices so much– I’ll be sure to keep that in mind as I look at different rates. It might also be a good idea for me to check my credit score and see just how much it can help!

    Reply
  2. Aaron says

    April 19, 2016 at 9:02 AM

    Useful steps! Try to pre-pay your car insurance policy as much as possible, my suggestion would be to choose the less coverage with the highest deductible.

    Reply
  3. Shawn Srour says

    January 11, 2017 at 11:45 PM

    “Thank you for these useful tips. Driving safely and maintaining a high credit score are two of the best ways to lower your insurance premium. It is also important to maintain a steady employment (or other) income. This way, your insurance provider can assess your ability to pay better and offer you the best quotes at the lowest premium.”

    Reply

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.



Create your own blog in 20 minutes and $20

Personal Capital, a free tool to change your financial health today

I use and suggest Upstart, for your personal loan need

CreditKarma, a free tool to check your credit scorey

I use Coinbase, for my crypto investments

101 Cents at a Time

101 Ways to Earn Extra Money on the Side
201 Frugal and Perfect Birthday Gifts
101 Ways to Save Money Everyday
101 Ways to be Better and Successful at Work
101 Ways to Save Environment and Energy
101 Frugal and Romantic Anniversary Ideas
101 Low-Cost Men's Fashion Ideas
101 Personal Finance Tips
101 Ways to Reuse Household Stuff
101 Things to Do, When Nothing to Do
101 College Graduation Gift Ideas
100 Tips for Ecommerce Startup
101 Ways to Enjoy Indoor During Winter
101 Ways to Beat Procrastination

Popular Posts

Quick Cash - How to make $100 legally, in a day
Living well on less than $15,000 a Year
Top survey sites for side income
What to do when auto repair goes wrong
Where should I invest my money now?
20 Ways to be productive and happy at work
51 Ways to get out of debt
Be a better person in 15 days, 15 ways
Income ideas for retirees and senior citizens
51 side jobs for college students
Urgently need a large amount of money?
Should I buy or should I rent?
Best Personal loan providers
25 Ways to save environment
25 DIY car repairs to save money
How to decorate office cubicle
How to show your wife you care
50 Financial Rules for Success
51 Frugal weekend family activity ideas
Become Rich By Saving 1 Hour Of Daily Wage
How much do I need to save for retirement?
How to negotiate your salary

Follow us on FaceBook

About Author

SB

Blogger by choice and IT manager by profession. Finance is my passion and gardening is my greatest satisfaction. Born in India, settled in US, Husband and a father. I created this blog in 2011 with a vision to help others. Thanks for your patronage. More info on my "about" page.

View all posts


Subscribe

Join our community of 5000+ subscribers to increase net worth and build wealth

Advertisements

Personal Stories

How I got a new HP computer replaced
Was COVID circulating in USA in fall of 2019?
How my credit score went up 800+
Why I didn’t invest in Bitcoins
How I controlled impulses to buy things
Why this blog is named One Cent at a Time

Subscribe via Email

Site Disclaimer

Disclosure of Material Connection: Some of the links in this web site are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission. Regardless, I only recommend products or services I use personally and believe will add value to my readers. I am disclosing this in accordance with the Federal Trade Commission’s 16 CFR, Part 255: “Guides Concerning the Use of Endorsements and Testimonials in Advertising.”
Read full Affiliate disclosure


One Cent at a Time is published by SB. The opinions expressed herein by him are his own and not those of his employer or anyone else. All content on One Cent at a Time is for entertainment purposes only. By reading this blog, you agree that SB and/or One Cent at a Time is not responsible for any actions taken after reading this blog. For the full disclaimer, click here .

Major Media Mention

One Cent at a Time Media Appearances

Copyright © 2023 One Cent At A Time · Designed by Nuts and Bolts Media