Life is just expensive, and auto payments and insurance are one of the biggest monthly costs people have outside of housing. Wondering how to save money on car insurance? Here are some tips that can help cut your bill:
Go Shopping
Prices can vary dramatically from company to company, so get several quotes. It’s easy to do online and with a few phone calls. Some state insurance departments publish price guidelines, which is helpful for comparing to see if you’re getting legitimate quotes.
Weigh Your Options
The reason you have insurance is to protect yourself in the event of an accident. Medical bills and legal fees can be astronomical, so consider how much coverage you need carefully. It’s more important to have enough coverage than it is to carry a low deductible, which is more costly. Tweak your quotes to see how much coverage you can get, while at the same time raising your deductible.
Ask for Discounts
Car insurance companies offer discounts for a number of reasons, including time without an accident or ticket, the number of miles driven each year, and multiple cars and drivers. If you live in a lower-crime zip code and store your car in a garage, you might be able to get a lower rate. Teenage drivers will cause your monthly premiums to skyrocket. Sometimes companies offer good grade or driver education discounts, and if your teen is away at college, be sure to update your policy accordingly so you’re not paying for someone who isn’t actually driving.
Add Safety Features
Insurers pay attention to things that help you stay safe in the event of a collision. Car insurance companies often offer discounts if your vehicle has safety systems, like airbags, anti-lock brakes, adaptive headlights, blind spot detection systems, and lane departure warning systems. Same with anti-theft devices. If your car didn’t come with a car alarm, consider installing one if your company will give you a break on your insurance.
Drive Carefully
The best way to keep your insurance costs down is to drive carefully and avoid tickets, accidents, and claims. It’s simply a matter of formulas that assess what kind of driver you are and how likely you are to cost them money. The longer you go without a claim, the lower your insurance rates will be.
Don’t Finance Payments
If you want to pay your auto insurance premium monthly, you’ll pay more for that convenience. You may have a harder time coming up with the full six-month premium in one chunk, but it’s worth it to avoid paying finance costs. Pay it in full, if you can.
Clean Up Your Credit Issues
Auto insurers love customers with good credit because generally, they’re less risky. That goes for auto loans, too. But, did you know that many insurance companies actually use your credit score to help determine whether to insure you and what your rate will be? Clean up any issues, and you’ll see the lowest rate you can get for car insurance, and you’ll be better prepared to apply for car loans.