Car insurance is an expense we love to hate.
But it’s a necessary part of life.
In fact, there are 6 million car accidents in the U.S. each year. Without car insurance, we wouldn’t be able to recover from the financial devastation that these accidents cause.
As a society, we are highly dependent on transportation and most people can’t afford to replace their own vehicle without insurance.
Plus, having car insurance is the law in almost every state. Not having insurance isn’t an option for most people.
Fortunately, there are ways to save money on car insurance to make the expense less painful. Keep reading for some simple ways to save money on your car insurance premiums.
Shop Around for Quotes
While this might seem obvious, you’d be surprised how many people stick with their auto insurance carrier simply because it’s what they know.
But when it comes to car insurance, change can be good and it can save you money. Whether you’re shopping for car insurance for the first time or renewing a policy you’ve had for years, doing a rate comparison could save you hundreds of dollars.
Some companies claim to do this for you and show you that they are the cheapest. This isn’t always the case.
All auto insurance carriers are different in how they set rates and offer discounts. If you were making any other major purchase, you would no doubt shop around for the best rate.
Auto insurance is no different. It’s recommended to compare prices annually. Checking around for better rates each year won’t hurt your credit score.
Increase Your Deductible
Many people purchase their car insurance policy and never give it another thought.
The truth is that auto insurance policies are customizable, just like other types of insurance. When you choose a health insurance plan, you have to decide between a plan with low premiums and a high deductible or paying more up front in premiums but having a low deductible.
Car insurance works the same way. Your deductible should be set based on what you can afford if can accident does occur.
If you can afford a $1,000 or higher deductible, don’t pay for $100 one. If you’re looking to save money on your car insurance premiums, this is an easy way to do so.
If you’re not likely to get into an accident and can afford a higher deductible, don’t pay for more insurance than you need.
Bundle
If you have spent any time watching television ads in the past year, you’ve no doubt heard that you should bundle home and auto.
But what does that mean?
Most people have more than one type of insurance policy. Common types include auto, homeowners, and renters.
Combining these policies by switching them all to the same carrier can save you money. Almost all insurance carriers offer a discount for bringing all of your business to them.
Plus, it’s easier for you to keep track of, especially if you do need to file a claim.
Reduce Your Coverage
As your car ages, you can save money by reviewing your coverage each year to make sure you aren’t over-insured.
In some cases, you may be paying for coverage that you don’t need. Remember that you won’t be paid out more than your car is worth.
Taking into account your deductible, make sure you aren’t paying too much. If your lifestyle has changed since you purchased your insurance plan, make sure your policy is up to date.
Also, consider whether you have overlapping coverage. For example, uninsured and underinsured motorist property damage coverage can overlap with collision coverage.
You should always make sure you have enough coverage to protect your assets and that you are following state laws on minimum insurance requirements. Your insurance agent can help you find the right balance of coverage.
Improve Your Credit
Did you know that your credit score affects your car insurance rates?
Most states allow insurance companies to factor your credit score and credit history into your insurance premium. It makes sense that someone who is responsible with their finances is more likely to be responsible behind the wheel.
Having a less than stellar credit score can cost you more in annual premiums. Working to improve your credit score will positively impact your life in many ways.
Claim Discounts
Before you switch auto insurance carriers, check with your agent to make sure all of the discounts you are eligible for are being applied to your account.
Most carriers will give you a discount for paying your 6-month premiums in full as opposed to making monthly installments. Of course, driving safely will improve your rates, but many insurance companies now offer discounts for being accident and ticket free.
Ask your agent about safe driving tools. Some insurance companies offer premium discounts in exchange for you using a device in your vehicle that allows the insurance company to monitor your driving habits.
Some other discounts you may be able to claim include:
- Paperless billing
- Multi-car
- Multiline
- Accident-free
- Good student
- New vehicle
Start to Save Money on Car Insurance Today
If you are looking to save money on car insurance, speak with an agent today.
An insurance professional is the best source of information about your options. Your agent will go over your driving history and be able to give you a quote as well as talk to you about potential discounts and coverage options.
Click here to get started.
