In 2019, an estimated 284.5 million registered vehicles were roaming the roads of America. Experts projected that that figure would grow to 287.3 million by the end of 2020.
But the number of cars in the US isn’t the only thing growing. Auto insurance coverage costs are on the rise too. As of 2020, the average annual auto insurance cost was $2,388.
Sometimes, the amount you’re paying for your auto insurance policy gets way higher than these figures. If you’re thinking, “My car insurance is too high,” chances are something is wrong somewhere.
Just because you have to have insurance to drive your car doesn’t mean you should be paying unnecessarily high insurance premiums month after month. Thankfully, there are practical steps you can take to keep high insurance car insurance costs from driving you bankrupt.
In this comprehensive guide, we point out some of the possible reasons your car insurance is too expensive. More importantly, we show you how to bring these costs down to a figure you can comfortably pay. Read on to learn more.
What Are Some Potential Reasons My Car Insurance Is Too High?
There are many factors that affect the amount you pay for car insurance. Let’s examine them closely and see how they might be impacting your current premium.
Your Driving Record
Most insurance companies do go out of their way to find out a car owner’s driving history before providing them with a cover. An auto insurer is interested in knowing any accidents you’ve had previously. They’ll also want to know of any traffic violations you’ve been involved in, including speeding tickets.
If you’ve caused car accidents before, even if it’s just a handful, you’ll most likely pay a higher premium.
Your Insurance Claim History
When you cause an accident, your insurance company has to make a payout resulting from that accident. Even if you just caused a few accidents, your insurance premium will be impacted.
Of course, the insurance premium for someone who was involved in one or two minor fender benders will be much less than someone who has totaled five cars.
Your Driving Patterns
How often do you use your car? How do you usually commute?
Drivers who drive more often and cover greater distances are more at risk of being involved in road accidents. Consequently, your auto insurance premium is much likely to be higher.
Your Credit History
Insurance companies usually inquire about your credit history as one of the steps to determine your premium. They’ll want to know your debts, any tax liens, medical bills, and personal judgments.
People with no credit history or with a tainted credit report will usually need to pay more for a car policy. The insurance company doesn’t care about the size of your debt, but they want to spot any delinquency patterns. If necessary, now’s the time to take steps to improve your credit score.
The Type of Car You Drive
Before providing you with an auto insurance cover, your insurance provider will want to know whether you drive a safe, ordinary car or a sports car that tends to get involved in crashes a lot. If the insurance company deems your car risky, they’ll charge you a higher premium.
The Policy You Choose
The auto insurance policy you choose and who’s included in it plays the biggest factor in determining how much you’ll pay. A policy with all the bells and whistles will definitely cost much more. Talk to an insurance professional to find out whether you might have chosen a coverage that’s higher than you need.
The deductibles also play a huge factor. The lower the deductible, the higher the premiums.
Quick Tips for Keeping Your Premiums Low
By now, you know how your insurance company determines your rates and why you’re probably paying a higher premium than you’d like. The great news is that you can reverse these rates. Consider these smart suggestions on cutting your premium.
Look for Discounts
Most insurance companies have discount programs, and chances are yours does too. Visit their website and find out whether they offer discounts for students, military personnel, good drivers (those without tickets or accidents), and so on. Take advantage of the option that’s relevant to you.
If you feel your auto insurance is unreasonably expensive, you can always switch insurers. Head online and take a look at what other insurance companies are charging. If there are better deals out there, consider applying for a new policy.
Bundle Home and Auto Insurance
The concept of bundling is simple: you purchase more than one policy with a single insurer. Doing so can save you money as the insurer is collecting multiple premiums from you.
Many auto insurers offer attractive discounts to clients who bundle their car insurance with homeowners’ insurance.
Practice Safe Driving
Safe driving isn’t only good for your safety and that of other road users. It’s also good for your auto insurance premiums.
Driving carefully and avoiding accidents leads to lower costs for your car insurance premiums. Your insurer will reward you for this. Many providers give a safe driving bonus to car owners who haven’t had an accident in a specific amount of time.
Opt for a Higher Deductible
Car owners who opt to raise their deductible automatically lower their premiums. This especially makes sense if you have an excellent driving record. The likelihood of getting into a crash is minimal, so you can save every month by raising your deductible as high as you feel comfortable with.
Adjust Your Policy
Examine your car auto policy, and find out whether there are adjustments that can be made to lower the premium. Potential changes include switching to liability only, removing any optional policies, and so on.
You Don’t Have To Pay Too High Car Insurance Premiums
If you’re thinking, “my car insurance is too high,” you’re not alone. The good news is that you can do something about it. By finding out what could be causing the increase in your premium, you can start to implement moves that bring down the premium to a figure you’re comfortable with.
Are you interested in an affordable auto insurance solution? Please contact us today.