Saving money on auto insurance is a common goal, but it’s crucial to balance cost savings with maintaining quality coverage and reliable customer service. This comprehensive guide offers practical tips to help you reduce your auto insurance expenses while ensuring you still receive the coverage you need.
1. Consider Insurance Costs Before Buying a Car
When contemplating a new or used car purchase, factor insurance expenses into your decision-making process. Auto insurance premiums can vary widely based on factors such as the vehicle’s price, average repair costs, safety record, and susceptibility to theft. It’s wise to research insurance costs for potential vehicles before making a purchase.
2. Combine Policies with One Carrier
Many insurance companies provide multi-policy discounts, offering savings when you bundle homeowner’s insurance and auto coverage from the same provider. Additionally, insuring all vehicles in your household or including all driving-age family members in a single plan may lead to cost savings.
3. Compare Auto Insurance Carriers
Given the significant variation in auto insurance rates and offerings, it’s essential to shop around. Obtain quotes and information from at least three different insurance companies. Consider reaching out directly to insurers, seeking recommendations from friends and family, and exploring online quote comparisons. State insurance departments can also offer valuable information on rate comparisons, customer ratings, and complaint ratios.
4. Drive Less, Save More
Reducing your annual mileage can result in lower insurance premiums. Many insurers offer low-mileage discounts for individuals who drive less than the average number of miles per year. Additionally, if you regularly carpool, inquire about potential discounts.
5. Drive Safely, Save More
Maintaining a clean driving record can lead to substantial savings on your insurance premiums. Insurers often offer discounts to drivers with a history free of accidents and moving violations. Consider taking a defensive driving course, as completing such a course may make you eligible for additional discounts.
6. Increase Your Deductible
While it involves accepting higher out-of-pocket costs in the event of an accident, increasing your deductible can significantly lower your collision and comprehensive coverage premiums. Evaluate your financial situation to ensure you can comfortably afford the higher deductible if a claim arises.
7. Inquire About Other Discounts
Insurers may offer various discounts that you can take advantage of, depending on your circumstances. Some common discounts include those for good students, individuals who have completed a defensive driving course, and specific demographic groups. However, it’s crucial to assess the overall competitiveness of an insurer’s rates, not just the available discounts.
8. Maintain Good Credit
An increasing number of insurers consider credit scores when calculating rates. Drivers with established and stable credit records may be eligible for lower premiums. It’s advisable to maintain a good credit rating and periodically check your credit report to ensure its accuracy.
9. Opt for Safety Features
Equipping your vehicle with safety features can make you eligible for insurance discounts. Features like antilock brakes, automatic seatbelts, running lights, and alarm systems contribute to reducing the risk of injury or theft, leading to potential premium reductions.
10. Reduce Coverage on Older Cars
Evaluate the value of your older vehicle by checking its Kelley Blue Book value. If the annual comprehensive/collision insurance premiums surpass 10% of the car’s current value, it might be worth considering dropping this coverage. Older cars typically have lower values, and paying more in premiums than the potential claim payout may not be cost-effective.
Remember, the key to saving on auto insurance is to find the best final price rather than solely focusing on the largest discounts. Prioritize an insurance company that offers competitive rates, reliable coverage, and excellent customer service.