7 Ways to Save on Auto Insurance
Want to save money on your auto insurance? According to the Insurance Information Institute, one of the best ways to keep auto insurance costs down is to have a good driving record. Following are seven other things the organization suggests you can do to help lower your costs:
1. Shop around. Prices vary from company to company, so it pays to shop around. Get at least three price quotes. You can call companies directly or access information online. Don’t shop by price alone, though. Ask friends and relatives for their recommendations, and pick an agent or company representative that takes the time to answer your questions.
2. Before you buy a car, compare 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.
3. Ask for higher deductibles. Deductibles are what you pay before your insurance policy kicks in. By requesting higher deductibles, you can lower your costs substantially. Before choosing a higher deductible, be sure you have enough money set aside to pay it if you have a claim.
4. Reduce coverage on older cars. Consider dropping collision and/or comprehensive coverages on older cars. If your car is worth less than 10 times the premium, purchasing the coverage may not be cost effective. Research the current worth of your cars, and review your coverage at renewal time to make sure your insurance needs haven’t changed.
5. Buy your homeowners and auto coverage from the same insurer. 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, and some insurers reduce the rates for long-time customers. However, it still makes sense to shop around. You may save money buying from different insurance companies, compared with a multipolicy discount.
6. Maintain a good credit record. Most insurers use credit information to price auto insurance policies. 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.
7. Seek out other discounts. Companies offer discounts to policyholders who haven’t 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’s 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. Some companies also offer discounts to motorists who drive a lower-than-average number of miles per year.
For more information on insurance, visit iii.org.