How To Lower Your Auto Insurance Cost

July 20, 2017

 

SHOP AROUND

 

Prices vary from company to company, so it pays to shop around. Get at least three price quotes from your agent. If your agent is a captive agent (agent who can offer you quote from ONE insurance company ONLY. For example, agents who work for Farmers, Allstate, State Farm, American Family, etc). Then you need to look for independent agents who offer policies from several insurance companies.

Don’t shop by price alone. There are only three types of buyers:

  1. Dollar Store Buyers (customers who only care about price not quality)

  2. Wal-Mart Buyers (customers who are willing to pay a little more for quality & service)

  3. Nordstrom Buyers (customers who care ONLY for quality & service. Price is their least concern)

Which one are you? Ask friends and relatives for their recommendations. Contact your state insurance department to find out whether they provide information on consumer complaints by company. Pick an agent who takes the time to explain the coverage properly and answer your questions.

 

COMPARE INSURANCE COSTS BEFORE YOU BUY A CAR

 

Before you buy a new or used car, call your agent for insurance costs. Car insurance premiums are based in part on the car’s price, the cost to repair it, its overall safety record and the likelihood of theft. Many insurers offer discounts for features that reduce the risk of injuries or theft. To help you decide what car to buy, you can get information from the Insurance Institute for Highway Safety (www.iihs.org).

 

OBTAIN HIGHER DEDUCTIBLES

 

Deductibles are what you must pay before your insurance policy pays its part. Getting higher deductibles, will lower your costs substantially. For example, increasing your deductible from $200 to $500 could reduce your collision and comprehensive coverage cost by 15% to 30%. Going to a $1,000 deductible can save you 40% or more.

 

REDUCE COVERAGE ON OLDER CARS

 

Consider dropping collision and/or comprehensive coverage on older cars. If your car is worth less than 10 times the premium, purchasing the coverage may not be cost effective.

 

BUNDLING HOMEOWNERS AND AUTO COVERAGE

 

Many insurers will give you a break if you buy two or more types of insurance. You may also get a reduction if you have more than one vehicle insured with the same company. Some insurers reduce the rates for long-time customers. But it still makes sense to shop around! You may save money buying from different insurance companies, compared with a multi-policy discount.

 

GOOD CREDIT SCORE

 

Establishing a solid credit history can cut your insurance costs by 25%. Most insurers use your credit information to price auto insurance policies. Research shows that people who effectively manage their credit have fewer claims. To protect your credit standing, pay your bills on time, don’t obtain more credit than you need and keep your credit balances as low as possible. Check your credit record on a regular basis and have any errors corrected promptly so that your record remains accurate.

 

LOW MILEAGE DISCOUNTS

 

Some companies offer discounts to motorists who drive a lower than average number of miles per year. Low mileage discounts can also apply to drivers who car pool to work.

 

GROUP INSURANCE

 

Some companies offer reductions to drivers who get insurance through a group plan from their employers, through professional, business and alumni groups or from other associations. Ask your employer and inquire with groups or clubs you are a member of to see if this is possible.

 

OTHER DISCOUNTS

 

Companies offer discounts to policyholders who have not had any accidents or moving violations for a number of years. You may also get a discount if you take a defensive driving course. If there is a young driver on the policy who is a good student, has taken a driver’s education course or is away at college without a car, you may also qualify for a lower rate.

 

When you are comparison quotes, inquire about discounts for the following: *

 

Antitheft Devices
Auto and Homeowners Coverage with the Same Company
College Students away from Home
Defensive Driving Courses
Drivers Ed Courses
Good Credit Record
Higher deductibles
Low Annual Mileage
Long-Time Customer
More than 1 car
No Accidents in 3 Years
No Moving Violations in 3 Years
Student Drivers with Good Grades

*The discounts listed may not be available in all states or from all insurance companies.

 

The key to savings is not the discounts, but the final price. A company that offers few discounts may still have a lower overall price.

Share on Facebook
Share on Twitter
Please reload

Featured Posts

What Does Full Coverage Auto Insurance Means?

October 5, 2018

1/1
Please reload

Recent Posts
Please reload

Archive
Please reload

Search By Tags

I'm busy working on my blog posts. Watch this space!

Please reload

Follow Us
  • Facebook Basic Square
  • Twitter Basic Square