10 Expert Ways to Lower Your Car Insurance

September 8th, 2010
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Insurance rate decline

Car insurance is a necessary evil, preventing against the high financial burden of a potential crash, at a high price. In most states, drivers are required to have auto insurance that covers liability for injuries and property damage to others. But coverage can include much more,  including medical coverage for injuries to the insured party, repair costs for the insured vehicle, and protection for theft or fire damage.

Typically, car insurance companies require the insured party to pay a deductible, or a fixed contribution, each time the car is repaired using the insurance policy. When another driver is at fault for the accident, their insurance company repays the
deductible.

The price of an insurance policy is dependent on many factors, and is usually calculated based on statistical information. Some of the factors that influence the expected cost to insure someone (and therefore, the cost of coverage) include the type of car the insurer drives, the type of coverage purchased, driver characteristics such as age, gender, and driving history, and how often the car is used.

Given the variable cost of car insurance, people can use these factors to their advantage. There are many strategies to lower your car insurance. Here are some of the best ideas to help you reduce the price of your car insurance:

1. Get multiple quotes

Car insurance prices vary from one insurance company to another. Get multiple quotes and compare. Contact your state insurance department and see if they’ll provide you with a comparison of the insurance prices at various insurance companies. Also ask the state insurance department about consumer complaints against insurance companies, and pick an insurance company that is well-liked and does good business. Make sure that you’re asking each company the cost of the same level of coverage, so you can accurately compare quotes.

Getting various quotes can also help you to negotiate with your current insurer for a better rate.

When choosing from the different companies, make sure to pick a company that is financially stable. Check how an insurance company uses rating companies like A.M. Best and Standard & Poor’s.

For a quick and easy way to get multiple quotes, try Autocricket.com’s insurance form.

2. Drive Safely

Driving safely is not only good for your health, but it will also cut insurance costs. Safe driving lowers your car insurance premium. Three or five years after a driver gets into a traffic accident or has a traffic violation, it may be removed from your record, therefore lowering your premium. Slowing down to avoid speeding tickets will prevent you from having to pay expensive speeding fines and will also prevent raised insurance rates.

Pay attention while you’re driving and avoid problems that could cost you. Avoiding accidents also saves you from paying the deductible for an accident.

3.Drive less

In addition to safe driving discounts, some insurance companies offer discounts for consumers who don’t drive many miles each year. These low mileage discounts can reduce the cost for motorists who don’t drive a lot or who carpool to work. The more you drive, the higher the risk you’ll get into accidents.  If you have a very short commute or a second vehicle that you don’t drive very often, you may want to consider an insurer that strongly rewards low mileage. You can purchase pay-per-mile auto insurance through many insurance companies, including GMAC and Progressive.

Consider ways that you can cut back on how often you drive. Choose public transportation, walking, biking, or carpooling when possible. Reducing how much you drive will not only cut insurance costs, but also prevent wear on your car, save you gas money, and help the environment. Plus, carpooling allows you to use the High-Occupancy Vehicle (HOV) lanes, allowing you to avoid traffic during your commute.

4. Choose your car based on insurance costs

Car insurance premiums are based on the car you drive. The car’s price, repair costs, safety record, and likelihood of theft can all affect the price of insuring the car. Insurers offer discounts for features that reduce theft or the risk of injuries. Features that may qualify you for a discount include air bags, automatic seat belts, anti-lock brakes, daytime running lights, or a good alarm system. The Insurance Institute for Highway Safety is a great resource for choosing a safe car. Many insurers also publish vehicle safety ratings and cars’ corresponding discounts.

5. Opt for a high deductible

Sure, you’ll have to pay more if you get in a crash, but requesting a high deductible can significantly decrease your car insurance premium. A high deductible can be especially beneficial for safe drivers who are unlikely to get in accidents. While any car accident will cost the driver a large price, the insurer will still cover additional costs in the case of a costly accident. Make sure that you have enough money saved to pay for the deductible before asking for a higher deductible.

This option might seem scary because of the potentially high costs of paying deductibles, but it often pays off. It’s unlikely that you’ll have to use your insurance and you’re likely to spend less on accident repairs than you would have spent on lower- deductible insurance coverage.

6. Reduce unnecessary coverage

Collision and comprehensive coverage may be unnecessary for older cars. If your car is valued at less than 10 times the insurance premium, reconsider purchasing the coverage. To see if insurance coverage is cost effective, find out the value of the cars you’re insuring. You can find the value of your car from an auto dealer,  bank, or through websites such as Kelley’s Blue Book or Edmunds.com.

Duplicating medical coverage is also an unnecessary cost. If you already are paying for good health, life, and disability insurance, personal injury protection is unnecessary. Only get the minimum protection required by your state when further protection isn’t helpful.

Some insurance policies include items such as towing and car rental, which may be unnecessary or may not be cost effective.

Review your policy with the insurance provider to make sure that you aren’t paying for any coverage that you don’t need.

7. Use the same insurance provider that you use for home or life insurance

Some insurance companies offer reduced prices when you combine policies with one insurance carrier. Buying car insurance from the same company as your home or life insurance can save you a lot of money. Insurers that cover multiple industries have ‘multiple policy discounts’ in attempt to be your only insurer. Most companies will also give you a discount for using the company to insure more than one vehicle on a single policy.

8. Maintain a good credit record

Insurers use credit information to set prices for auto insurance policies. Maintaining a good credit record can help to cut your insurance costs significantly. Generally, the better your credit, the lower your insurance rate will be, although some states restrict how insurance companies can use credit information in determining rates.

To avoid high costs due to a low credit score, monitor your credit score and take steps to repair and rebuild your credit rating. To build good credit, pay your bills on time, don’t obtain unnecessary credit, and make sure to keep your credit balances low. Check up on your credit record frequently to make sure that there aren’t any errors.

9. Ask about group insurance

You may qualify for reduced car insurance costs if you get the insurance plan through a group plan. Many employers offer group insurance policies. Professional, business,  alumni groups, or other associations, may offer group plans with a specific insurer. Membership with clubs such as AAA or AARP also lower car insurance premiums.

10. Look for other more obscure discounts

Make sure to check for other possible discounts. Some companies offer discounts to drivers who haven’t had any accidents for a certain number of years. Taking a defensive driving course to improve your driving can lower car insurance premiums. Young drivers on a policy may get discounts for good grades, taking a drivers education course, or going to college without a car. Seniors and retired people often qualify for lower rates, and longtime customers may also be eligible for discounts.  As always, remember that Autocricket.com is your source for finding any and all information needed in your search for auto insurance.

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