Car insurance protects you from legal consequences, medical expenses, and other financial liabilities if your car gets into an accident. In most regions, having car insurance is a mandatory requirement by law. Sometimes, the insurance premiums may seem expensive, and this is not a bill you can get rid of. Luckily, there are various adjustments and practices that you can make to reduce your car insurance rate. Consider the tips below.
Shop Around for Better Insurance Costs
Insurance premiums vary from one company to another, so shop around and obtain quotes from different insurers. Check through your state’s insurance department and compare several top companies. Keep in mind that the cheapest insurer isn’t always the best. Before choosing an insurance company, check their financial status and their ratings. Find out if there are any customer complaints about the company.
Ask your friends and relatives for recommendations also. Once you narrow down your list, call and inquire more about the service. Choose the company whose representatives are more willing to answer your questions. Every one to two years, obtain quotes from other companies just to see if there is a better deal available.
Stay Clear of Accidents and Violations
Your lifestyle and driving habits will also affect the cost of insurance. The insurance company will calculate the premiums based on the anticipated risks. If you already have a speeding ticket, moving violations, or at-fault accidents in your driving report, they can increase your premiums.
But if you drive safely for an extended period without breaking the rules, the insurance company will term you as a less risky driver. This will bring your premiums down, and you can even get behavior-based discounts.
Ask for Higher Deductibles
Deductibles are what you pay before the insurance plan kicks in. Note that lower deductibles attract higher insurance premiums. Increasing your car insurance deductibles from $500 to $1,000 can slash your premiums by approximately 8.5%. However, ensure that you set your deductibles to an amount you can comfortably pay to replace or repair your vehicle after an accident.
Bundle Your Insurance Policies
If you obtain insurance services from a company to cover a single car, you will pay higher premiums. You should, therefore, inquire about insuring several vehicles for your family members to get a bulk rate. This works for your immediate family, those you live with in the same residence, related by blood or marriage. Two unrelated people may also enjoy multi-car discounts if they jointly own the vehicle.
If you have teenagers in your family, you might pay more for insurance. Research reveals that drivers between 16 and 17 years tend to have worst driving records. But if your child gets good grades at school, they might benefit from a good student discount. These young drivers can save between 6% and 36% on their auto insurance bills.
Older relatives with more experience will also attract lower premiums. Seeking home insurance services from the same provider will also lower your car insurance rates.
Boost Your Credit Score
The insurance companies also check your credit score when making rate calculations. A driver with a high credit score appears more responsible and is less likely to file claims. This will lower your insurance premiums considerably. To achieve a good credit score, ensure that you pay off your debt in time and remove any errors in your credit history.
Take a Defensive Driving Course
You will lower your auto insurance rate by completing a defensive driving course. This course will improve your driving skills which results in lower premiums. After a violation, enrolling in a defensive driving course will help improve your driving record, too.
But, before you sign up for a class, confirm with your insurer whether they offer any discounts for this course. Only sign up for an accredited course in your state. You should also ensure that the course doesn’t cost more than the expected savings from the reduced premiums.
Choose a Car That Is Cheap to Insure
The vehicle you drive will determine the rate of insurance premiums you pay. It’s nice to own a large SUV, but the insurance cost is significantly higher than a smaller car. Since sports or luxurious vehicles have high value, they cost more to replace or repair, hence, the high insurance cost.
Used vehicles attract lower premiums than new ones since the insurer won’t have to pay more for replacements. You can get insurance quotes for different models to guide you in choosing the right car.
Stop Paying for Policies You Don’t Need
You should review your coverage often, and drop items that seem unnecessary. For instance, if you have a cheap old car, you can drop coverage that caters to car damage. The collision coverage will pay for repairs or replacements when you hit static objects.
On the other hand, comprehensive coverage reimburses you if your car gets damaged by another incidence other than a collision. Rather than paying for such coverage, it would be best to replace the old car.
Keep in mind that, if the vehicle gets into an accident, the insurance company will only replace the car’s value at the present time. You could end up paying around $500 annually for collision coverage only to get a compensation of $100.
Install Safety Features
A car that has various safety features like airbags, engine cut-off, antilock brakes, or an antitheft system can help lower your premiums, too. Such a car is less likely to get stolen or vandalized, hence, the lower insurance rate.
If your main aim for installing the safety features is to lower insurance premiums, ask the insurance company for the specific devices that can reduce the rates. Also, gauge between the cause of installation and the level of savings you will make to see if it’s a worthy investment.
Earn Low Mileage Discounts
Some insurers also offer considerable discounts to policyholders with lower annual mileage. If you cover a shorter distance with your car, there are lower chances of getting into accidents. You can look for jobs close to your home area to lower your car mileage. People who have a work-from-home job arrangement can earn more discounts.
If you have a car that you use seasonally, consider the pay-as-you-go insurance plan charged based on the number of miles you cover. In such a case, you allow your insurer to track your driving, and you will earn discounts based on how well and how often you drive.
Join Group Insurance
Some insurance companies offer discounts to policyholders with membership in particular groups or organizations. You can get discounts from your employers, alumni associations, or other professional groups.
So, ask your employer or members in other organizations about joining their auto insurance group. Also, inquire from the insurer about all the clubs or other groups for which you have a membership to see if you can get discounts.
Vehicle insurance rates vary from state to state, but you can lower your premiums by maintaining a clean driving record. Shop around for the best deals possible and inquire about the discounts available. Choose your car wisely, and always remember that a second-hand vehicle attracts lower premiums than new models.
There are ways to lower your car insurance premiums without compromising coverage if you take the time to check out the options that are available to you.
