If you own a car, buying insurance is essential. Not only is it required by the law but it can also help protect you financially if you are involved in an accident. Getting the proper level of coverage is important. The amount of money that you have to pay to insure your vehicle depends on a number of factors including its age. Using the following tips, you should be able to keep the cost of insurance as low as possible while still ensuring that you have adequate coverage.
Compare Rates Once A Year
Insurance companies tend to offer discounts and benefits to customers that have been with them for a long time. Because of that, you may find it hard to find a lower rate than what you are currently paying if you have been with your insurer for a number of years. In 2014, Consumer Reports conducted a survey that discovered that only 10% of their subscribers were able to get a lower rate by comparing prices. However, it is still worth getting quotes and to compare your insurance policy to see if you could be paying less with a different insurer.
There are a lot of websites out there that will allow you to compare rates from multiple insurers by submitting a single form. In some cases, insurance agents from the companies included in the quote will contact you directly to talk about your options. It may be worthwhile to talk to these agents to see what deals they have available so you can get the best rate.
Choose An Insurance Company You Can Trust
Finding a great rate is only one part of the equation. You also need to make sure that the insurance company will follow through if you ever need to file a claim. The last thing that you want is for the insurance company to balk at the idea of paying out or to try to undercut the amount of money that they pay to you. It is also important to look for an insurer that won’t gouge you by charging excessively high insurance rates if you are involved in an accident.
From 2011 to 2014, Consumer Reports.org surveyed their subscribers to find out how satisfied they were with the way that their insurance claims were handled. Overall, the results were encouraging, with more than 85% of the respondents saying that they were extremely satisfied with the service that they received. The groups that got the highest ratings in the survey included NJM, Amica, and USAA.
Decide On A Reasonable Deductible
Choosing a higher deductible may help you qualify for a lower car insurance rate. For instance, you may be able to enjoy a rate that is as much as 30% lower simply by increasing your deductible to $500 rather than $200. Similarly, increasing your deductible to $1,000 could help you save as much as 40%. If you are generally a safe driver, it may be worthwhile to choose a higher deductible. Just make sure that you have enough money in savings to cover the cost of your deductible in case you are ever involved in an accident.
Read Through Your Coverage
Avoid the temptation to purchase the minimum amount of insurance required by your state. It is usually better to increase your liability limits rather than risking going bankrupt or wiping out your savings if you are involved in an accident.
One way that you may be able to save is by cutting out rental-reimbursement coverage. This is especially true if you have a second vehicle. Instead of having to rent a car, you can simply drive your other vehicle while your damaged car is in the shop for repairs. The same goes for roadside assistance. If you already have a membership to an auto club or if your car’s warranty provides roadside assistance, you probably don’t need to purchase additional coverage.
In terms of medical payments and personal injury insurance, you may not need it if your health insurance will cover any injuries. However, if you often have passengers in your vehicle who don’t have adequate health coverage, you still might want to keep it to ensure that they are protected.
If you have a teenage child, the cost of your insurance policy may dramatically increase. You can help combat this by having your child take a driving course that focuses on safety before they become licensed. You should also make sure that your child understands that there will be repercussions if they drive in an unsafe manner.
If your child is a college student who attends school far away from where you live or if they don’t have a license, make sure that your insurance company knows. That way, you won’t wind up being charged extra for your insurance.
Keep Your Credit In Good Shape
Interestingly, most car insurance companies use your credit score when determining how much you have to pay for your premiums. If you aren’t sure whether your insurance company uses this practice, you can always ask them. The best way to avoid any problems, however, is by making sure that your credit is in good shape. Order copies of your credit report once a year and check for any errors. If you have bad credit that was caused by factors such as a divorce, a death in your family, a medical problem, or the loss of a job, your insurer may be willing to work with you to come up with a more reasonable rate.
Inform Your Insurer About Any Changes To Your Driving Habits
On average, people drive approximately 12,000 miles each year. If the distance that you drive on an annual basis dramatically decreases, you should inform your insurance company about the change. For instance, if you retire from your job and no longer have to commute, you may be able to save quite a bit of money on your insurance.
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