Purchasing a car can leave a huge dent in the bank balance – but getting insurance widens the dent even further. If it were up to some people, insurance would never be part of the process. But considering its importance and the fact that it’s required by law, buying insurance is more of a necessity than an option.
Insurance is not something that you wish away. So that leaves you with one option – to minimize the amount you spend on the insurance coverage. But the question is how do you save money on car insurance?
Here are some top tips on how to save money on car insurance:
Compare options
Like other businesses, insurance companies aren’t created equal. They differ in how they charge their rates, and premiums, among other things. Usually, the difference in premiums and rates can vary by hundreds of dollars for the same levels of coverage based on a range of factors. A good driver with incredible credit can save an average of $100+ every month by getting the most affordable insurance company. Drivers with a recent at-fault accident or poor credit can even enjoy more significant savings by finding the cheapest insurance company. Our point is you should not settle for the first company that comes your way. Instead, take the time to compare quotes by using a comparison engine like The Zebra to get dozens of quotes at once and work with an insurer who’s offering the best deal.
Drop optional coverage
Different types of insurance coverage exist; some are mandatory, while others aren’t. At the most basic, you will need liability insurance to protect you from liability risks imposed by lawsuits and claims from other parties. That’s mandatory by law. However, you can drop the collision or comprehensive coverage if your car is old. Comprehensive covers theft and damages resulting from vandalism, fires, storms, or animal damage. Collision coverage, on the other hand, repairs damage from accidents and flip overs. You can check out The General for more cost-saving insurance options.
Ask for discount options
Asking for special discounts available is another incredible way of cutting down your insurance premium. Have a clean driving record without accidents? Check for a safe driver discount. Have special features on your vehicle like theft protection or anti-lock brakes? You may also find discounts for you. Different insurance companies provide different discounts based on coverage options, cars, mileage, driving history, and lifestyles. Others look at driver training, membership, customer loyalty. Whatever category you fall in, you can ask the company or ask your agent to check your potential savings.
Increase your deductibles
Insurers charge according to the level of risk you present and the amount of risk they take to pay a claim. Raising your deductibles is a great way to lower the insurer’s risk. If the insurer pays out for every minor accident on your car, they will need to release funds to process and pay the claim. But if you raise your deductible, the insurer will only have to take care of significant accidents.
Lower your risk profile
As mentioned earlier, insurance companies will set your premiums according to how they perceive your risk. For example, as a new driver, you can lower your risk by taking driving courses or take defensive driving lessons if you are experienced. Being a safe driver can also go a long way in reducing your risk. And by this, we mean not drunk driving. Not speeding. Not driving aggressively. In a nutshell, you need to observe all the traffic laws.
Get a car model that’s cheap to insure
You probably do not know this, but some cars are expensive to insure than other vehicles. In most cases, expensive and flashy cars will cost more because of the risk they pose in the event of damage or theft – especially if you’re buying comprehensive and collision coverage. Safe and moderately priced cars, on the other hand, are cheaper to insure.
Since the law requires you to have car insurance, you might as well go for the cheapest coverage possible. You don’t have to break the bank each month. And with these tips, you can get the best possible deal in the market. Don’t let an accident ruin your account dry because you failed to get the protection you needed.
Establish a solid credit history
Good credit history goes a long way in helping you get incredible insurance rates. If you have low creditworthiness, you may want to work it up to make it good. And if you have a good one, you should strive to maintain it. Most insurance companies use your credit data to determine your car insurance rates – this could be because statistics show that those with excellent credits make fewer claims.
Consider group insurance
Some insurers provide deductions to people who get their auto coverage through a group plan in conjunction with other professionals, their employers, or alumni and business groups, and so on. If you have no idea where, to begin with, this, you can ask around your peers to see whether they can guide you over the same. You can also check with your employer to see what they offer.
Combine policies
If you have more than one insurance policy, it might be a good idea to combine them with one carrier. Doing this will not only simplify your finances and make it easier for you, but it will also open you up to discounts.
Compare prices annually
Getting a fantastic rate on your auto insurance is just the beginning. It will be worth your while and money to compare your current rate annually. This way, you are able to identify better deals – because rates keep changing from time to time. And thanks to the internet, comparing prices is as easy as tapping some buttons on your phone.
Conclusion
Having adequate auto insurance is both prudent and smart, but there is no doubt that it adds to your personal and driving expenses. Since premiums vary depending on a range of aspects, taking time to review your options can land you a great deal.
