How to Get the Most for Your Money: 11 Ways to Save Money on Your Car Insurance...
What do you need to know? Well, there are lots of ways and here are 11 that you can save money. Many of these ideas may apply to you.
- One Insurer, Multiple Policies – Do you have a homeowners or renters insurance policy? If yes, is it with the same insurance company that provides your auto insurance? If the answer is no, you could be paying too much – for both policies. Almost every insurance company that sells auto insurance wants its policyholders to also buy homeowners insurance or renters insurance from that company.
These insurers offer so-called multi-policy discounts. Usually, these discounts are at least 10% and can go as high as 25% most insurers apply the discounts to both the auto and the homeowners/renters policy.
* Tip. Talk to us about multi-policy discounts!
- Good Driver, Good Price – It’s no secret that the better your driving record, the less you will pay for auto insurance. But did you know that most people qualify as “good drivers” and are eligible for discounted premiums? Some good drivers pay a lot more than others, however.
Most insurers are actually a collection of several insurance companies in which each caters to a certain type of driver. The worst drivers go in one company, the best in another, and a lot of people wind up in one of the middle companies.
These "middle people" pay less than the worst drivers, but more than the best. The thing is, many of these middle people have driving records that are just as good as those who are insured by the companies that offer the lowest rates. Yet these middle people are paying more. Why?
The usual reason is those people's policies have not been reviewed! No one re-quoted their coverage for years. If you have a spotless driving record, there’s no reason you shouldn’t be paying the lowest price a group of insurance companies has to offer.
* Tip. Talk to us about your Auto Insurance Renewal And remember, be a safe driver. It will save you money.
- The Beauty of the Bus (or Other Mass Transit) – Do you drive to and from work? If you do, you are paying a premium to do so as insurance rates are largely based on miles driven (second only to type of car). The longer your commute (in miles, not minutes), the higher the premium.
* Tip. Some drivers should consider mass transit, where practical and safe. But you will reap the savings of gas and lower insurance costs.
- Low Mileage, Low Price – On average, people drive 1,000 to 1,250 miles a month. That is what auto insurance companies consider average use.
* Tip. If you drive less than the average, you could be eligible for low-mileage discounts, which some insurers offer.
- High-Profile, High-Cost – Type of car you drive is a major factor for insurance rates. Is your vehicle a magnet for thieves? Is it more expensive to repair? If the answer to either of the last two questions is yes, you’re paying more than the average car owner for insurance. Sometimes people are shocked when their new Hybrid is more expensive to insure than the big, fat V8 they got rid of!
* Note. Write to the Insurance Institute for Highway Safety at 1005 North Glebe Rd., Arlington, VA 22201 and ask for the “Highway Loss Data Chart.” - this will give you a lot of information on your car or a car you're thinking about buying.
- Raise Your Deductible – The deductible is the amount you pay before insurance kicks in if you have a claim. For example, if you have a $250 deductible and you have an accident in which your car sustains $1,000 in damage, you pay the first $250 and your insurer pays the balance, $750. Sometimes, carrying a $1000 deductible could be yield substantial savings!
* Tip. If it’s been years since you’ve had an accident, you may be better off raising your deductible and paying less each year for insurance.
- Drop Unnecessary Coverages – Let’s say you have an older car, one not worth very much. There’s really little point in having collision and comprehensive coverages. What would you be paying to insure? Remember, too, that you have to subtract your deductible from any potential payout you might get.
* Tip. As a general rule, any car worth less than $1,000 shouldn’t have collision and comprehensive coverage. (We usually suggest $3000-$4000 as the cutoff). How much is your car worth? There are tons of places on line where you can estimate the value.
- Discounts, Discounts, Discounts – Auto insurance companies offer several discounts for a variety of reasons. The car has automatic seat beats, air bags, anti-lock brakes, anti-theft devices, etc. The driver is a good student, which is especially valuable if you have teenage children who will be on your policy.
* Tip. Make sure you are taking advantage of all the discounts available to you!
- Taking the Defensive – Many insurance companies also offer discounts to those who have recently taken defensive driving courses. These are generally 5-10% for the driver.
- Low-Cost and High-Cost Areas – Are you planning to move? If you are, you should take into account the cost of insurance. Generally, the more urban the area, the higher the premium. The costs can vary even within a community.
* Fact. Rates can vary greatly from County to County. For example, someone living in Los Angeles or Santa Clara County can pay several times more, on average, than someone in Northern California.
- Credit Where Credit Is (Or Is Not) Due – Is your credit record better than your driving record? In California, credit is not allowed to be a primary determining factor in your rates, but it can still affect your eligibility for discounts and special programs.
* Fact. In some cases, with some companies, you could save money by shifting your business to an insurer that uses credit as a rating factor – even if you have a so-so or poor driving record. Th
* Tip. Regardless of your credit status, you should talk to usto make sure you have the best situation given your credit record, good or bad.