How to Lower Your Car Insurance Cost
Shopping for insurance is tricky, because of all the things you apparently “need coverage for” because of everything that “could possibly happen.” Here are some tips you can use to lower your total premium without getting into a war over terms and coverage.
Get an Insurance Quote Before the Car Itself
If you are a first-time buyer of both cars and insurance, get insurance quotes before you even get the car. Give the insurance agent the make and model, and let them walk you through the prices.
To lower the premiums, ask if they have discounts if your car has more safety features like airbags, or security features such as car alarms. Some insurance companies, as part of their social responsibility measures, even have discounts for how eco-friendly your car is, so bring that into the mix.
Remember, you’re trying to reduce your risk to the company for them to consider lowering the premium.
Keep Your Driving Record Clean
Keeping your premium down should be a good motivation for safe driving. If you don’t have any driving violations or tickets, especially for quite a few years (3 and upwards), you might qualify for discounts.
Raise the Deductibles
Premiums are what you regularly pay to maintain your coverage. Deductibles, on the other hand, are what you need to pay before you receive that coverage. If your premium is $100 and your deductible is $250, and your car is insured against collisions, you would need to pay $250 of the total bill yourself before the coverage paid the rest.
Then why raise the deductible? Because the higher the deductible, they lower the premium you can ask for.
Shop around not just for lower premiums, but for better discounts. Check if using just one insurer for both your car and your house (or for multiple cars) will get you a discount for sticking with them.
On the other hand, despite their discounts, you might win better with separate insurers. Compare and contrast your savings to get the best possible auto insurance deal.
Don’t Go for Monthly Billing
Some insurance companies give discounts if you pay once or twice a year instead of monthly. Some give considerable discounts if you are able to pre-pay for an entire year.
Monthly payments increase your risk because you can end your policy any moment; locking into a longer-term payment scheme makes companies confident and helps you cut on premiums.
Ask for Low Mileage Discounts
If you are a frequent driver, you would probably need higher coverage. If you are an infrequent driver because you usually take the train to work or you often carpool, let your insurance company know. They could give you a low mileage discount because lower car use = lower risk = lower premiums.
Lower Insurance on Your Older Cars
Sometimes, because of the value of an older car, the premium of full coverage might not be worth it. Based on your needs and capacity, you can opt to remove certain details from the policy, such as collision coverage.
This works especially if fully restoring the car would be worth almost more than the vehicle itself. Focus on protecting newer cars of higher value.
Research for Additional Discounts
Some companies offer group discounts if you join their pool of employees all insured at the same place. You can also reduce your premiums if you invest in some defensive driving courses.
And most of all, remember: the whole insurance industry is about reducing risk. You reduce yours by taking out an insurance policy; companies reduce theirs by basing their premiums on how big of a risk you might be. With wisdom and a lot of research, you can manage your premium costs.