7 Ways To Lower Your Car Insurance Costs
Of all the car insurance tips out there, the ones that most drivers really want to know are those that can help them save money on their policy. The good news is that, while you must own car insurance in order to legally drive on the nation’s roadways, there is a multitude of options that can make it easier to afford this mandatory coverage.
It’s more than just about getting discounts from your insurance provider, although these can really help you put a dent in those premiums each month. There are a number of sensible solutions you will want to investigate further so you can lower your costs for maintaining a policy. But before you do anything, read your policy in full. Chances are you haven’t lately or at all, however, it could reveal a lot about the current bloat or unnecessary features you may be carrying (and paying for each time you renew your coverage).
So, give your policy a thorough examination, look for areas where you may be holding limits and benefits that are higher than need be based on your driving habits. You might also want to drop certain features on your policy such as roadside assistance and rental car coverage. These are perks that you can enjoy elsewhere, instead of paying more to enjoy them as part of your insurance policy.
Now that you know what is in your policy and what isn’t, you can make some changes in your driving habits to help make it easier to insure your car. There are actually seven very effective ways to reduce the costs of auto insurance and the more of these options that you implement when purchasing your coverage, the better off you will be in trying to keep more money in your pocket.
1. Compare Rates
You don’t need to be purchasing a new policy in order to shop around for the best rate. In fact, it’s recommended that policyholders do this each year to see if they can find another insurer or perhaps even their current provider who will offer them a lower cost for coverage.
Some comparison shopping can be very revealing in that you may very well discover that two different companies are going to quote you two different prices to insure the same automobile. Your rates are based upon a wide variety of factors related to your driving record, your personal habits, your place of residence, your age, and other criteria. Every year, these things can change which can work in your favor when it comes to paying your premiums.
If anything has changed in your life or your driving habits, you should always contact your insurer and the agents at some of their competitors and see who is willing to give you the lowest rate on your insurance policy.
2. Driving Record
As mentioned above, the cleaner your driving record, the less you will be forced to pay in insurance costs. Drivers with excellent records that have no accidents, speeding tickets, or other moving violations can expect to pay less because they have proven themselves to be less of a risk to an insurance company. You could end up paying up to 5% less each year.
If you do have any of these things on your record, many of them are purged after a specific amount of time and you could be eligible to get lower rates because your record has improved.
3. Increased Deductible
Insurance companies are willing to lower your premium costs if you are willing to take on a higher deductible if and when you need to file a claim. Simply put, the insurer is asking you to pay more out of pocket before your coverage kicks in and you start to receive your benefits. Anything that reduces the amount of risk involved for the insurance company is going to motivate them to lower your costs.
With a higher deductible, you may have to spend upwards of around $1,000 ahead of your insurer kicking in what is expected of them as per your policy. Many drivers are ready to take a gamble with a higher deductible because they don’t expect to get into an accident any time soon and if and when they do, they are prepared to pay more at the time of the accident than each month or every six months when the next premium payment is due.
4. Lower Miles
Your driving habits play a big role in your insurance premium. If you are driving it less, then you are reducing the risk of getting in an accident. Insurers like that and they are ready to show their appreciation by reducing your rates. A low-mileage discount is one of the more popular insurer discounts that are available from most insurance companies.
Even if you end up driving less miles per year than what you declared when you first bought your policy, you could contact your insurance company and let them know.
5. Vehicle Type
You could go for that fast and flashy two-seater or a more sensible four door alternative. Each of these cars can have an impact on your insurance rates. So when you are walking around the new car lot, don’t choose the vehicle you want based solely on how you will look on the road, consider how it will impact your insurance rates.
Ask your salesman what features the car you like might offer that can help lower your rates and ask to see a model that might be easier to insure. Things like anti-lock brakes, air bags, and automatic seat belts can all work in your favor.
6. Anti-Theft Options
While you’re looking for safety features that will make it cheaper to insure the vehicle, you should also explore what anti-theft options are available on the vehicle. Anything that keeps the car from being broken into or stolen outright reduces your level of risk and that makes it easier for your insurer to charge you less each month.
7. Pay in Full
Speaking of monthly payments, another good way to lower your auto insurance costs is not to pay on a monthly basis. Many insurers offer their customers a discount if they pay their premiums in full each billing cycle. Monthly payments may be easier for most policyholders but it can be easier on your wallet if you pay in full over six months or a year at a time.
The insurance companies prefer when you pay in full because they know your policy is valid and will continue to be if and when they have to pay out on a claim.