This is a necessary and mandatory expense, but do not give up your hopes of reducing your car insurance costs. It can be done; you just need to know where to start.
This article is a good starting point for cutting auto insurance costs with a few simple tips and tricks.
Keep reading and you will have all the inside information that insurance companies are reluctant to share.
In some cases, you can benefit from a discount if you hire your car insurance along with other insurance services, like home, health and travel. After all, insurance companies love to encourage client loyalty.
Clients who do this can get up to a 10% off the total premium. It is true, however, that in some cases, instead of offering a policy discount, companies provide their clients with special discounts on vehicles or home security gadgets.
| Keep in mind: The combined policies of car and home insurance can come with particularly convenient cost reductions. |
Do not settle for a company because it is the most well-known or because a couple of acquaintances got their car insurance there. It is best to take your time to set different policies side by side and make a list of all the pros and cons. Some features that you should consider when shopping for car insurance are:
Even though you may be able to access this information online, the best strategy is calling the company as well, since some discounts are only offered over the phone.
Also check with your state’s insurance department and renowned consumer magazines, and, of course, ask friends and relatives for recommendation.
Car policies are not the same for everyone; they are tailored to the clients needs and the car’s characteristics.
But what is taken into account in the process of estimating a car premium? Mainly, the car’s price, its safety, the year of manufacture and the model. A common rule of thumb: If the value of your car is not around 8 to 10 times the cost of the premium, then it may be convenient to rule out collision coverage from your premium.
| How much is your car worth? Banks and dealerships can help you pinpoint the exact worth of your vehicle. |
Researches show that people who can handle their expenses responsibly have less chances of claiming. Consequently, auto insurance companies pay close attention to customers’ credit records. Are you organized with your expenses? Then you may be rewarded with a lower premium.
| Keep in mind: Before applying for car insurance, check your credit record and see if there are any unusual expenses you should inform your bank about. |
First things first, what is a deductible? Basically, before your coverage starts working, it will be up to you to pay certain car expenses that may come up. This is, of course, up to certain number.
A deductible can be of $300, $400, $500, or maybe more. The thing is, the lower your deductible, the higher your premium will be. And it works the other way around.
But how low can your premium be? Well, if you go for a $1,000 deductible, you may benefit from a 40% premium discount. But hold your horses: do not go for a deductible that you will not be able to afford if you are in a car accident. Don’t get carried away!
| Keep in mind: Every state has its own deductible limit (i.e., the maximum deductible you can pay). Make sure to find out which is the deductible limit for your state. |
This may make you eligible for a premium discount. Drivers who use the car for short distances and short periods of time are less accident-prone.
The insurance company will find out your driving frequency when you fill out the questionnaire, which usually includes a question on how many miles a year you drive.
Responsible drivers usually get higher premium discounts because they do not represent a high risk according to insurance experts.
If you have a spotless driving record, you are in luck. If, on the other hand, you do have some speeding tickets on your record, your car insurance costs will go up.
By the way, for every three years without any traffic tickets, you could get a premium rate reduction. This varies, of course, depending on the car insurance company you are negotiating with.
| Keep in mind: A good driving record may help you save 5% on your rate. Or even more! |
It could be a smart move to take into account features that could reduce your insurance rate.
There are some car models that get a rate reduction, like hybrids or other alternative fuel vehicles. Other car models, especially foreign ones, come with higher premiums because the repair parts are usually more expensive and harder to find. SUVs also come with higher rates because they are more expensive.
The age of the driver can also affect the cost of the car insurance. According to experts, certain ages are more prone to fender benders…
The truth is that teenage drivers unfortunately come with higher premium costs. Nonetheless, there are ways to reduce them. For example, students with good grades (B average or above) can be eligible for insurance discounts. Safe driving courses could also reduce the costs of insuring a teen driver.
| Keep in mind: A smart alternative could be to put the teen in an adult’s driving policy instead of a separate one. |
Adult drivers over 55 may be eligible for special discounts, especially aimed at retired drivers. It is convenient to check while shopping for car insurance, since not all companies offer such a discount.
When looking at the company’s brochure, check all the things that will be covered. Is there anything you do not really need? A common thing that you may want to remove from your coverage is roadside assistance (if you have Triple A).
As you already know, in the case of old cars that have already been paid for, you may be better off without collision or comprehensive coverage.
As with any payment in installments, the cost of paying your car insurance on a monthly basis will be higher than an annual or six-month payment.
Of course, it may be scary to commit to a big payment, but if you save money on a monthly basis, you will not have any problems and you will dodge that annoying surcharge.
Make sure, however, to ask the insurance agent what are the monthly payment surcharges.
A defensive driving course can be quite an asset for car insurance companies since these courses are aimed at reducing the chances of a traffic accident.
Besides, if you have many points in your license, this could be the smart way to reduce them and, consequently, reduce insurance costs.
A piece of advice: ask the insurance agent before enrolling for the course, given that not all companies come with this discount.
Your criminal record is also a factor that companies consider when quoting your premium. What is more! Your district can influence the cost of your insurance, since if you live in a dangerous area, the chances of being the victim of a car theft go up.
Now you know that if you want to cut back on your car insurance spending, you will be able to; there are many strategies that can take you a long way. Just need to take enough time to see which ones apply to you and start saving on your car insurance expenses without losing important coverage.
