Are you paying too much for your car insurance? It may sound like a cliche advertisement, but the data show most Americans are indeed overpaying for car insurance
. There are a number of ways you can make car insurance more affordable and in this article, we’ll examine how to take advantage of these potential savings.
Shop for car insurance quotes
Not every insurance provider is going to offer the same rate for the same driver. Because there are so many factors that play a role in determining your cost for insurance, including your age, driving record, your state, your usage, and the company profile itself, there’s a high probability you could find extra savings by switching insurance providers.
Find a handful of area providers, including local independent agencies, and call them asking for a quote. You’ll need to know your driving profile as well as the vehicle identification number (VIN) for the cars you plan to insure to get the most accurate quote.
Ask your car insurance company for discounts
Car insurance providers offer discounts for safe driving, multiple cars, membership affiliation (AAA for example) and even good grades if you’re a student, just to name a few. These discounts routinely go untapped by drivers so make sure to call your agent and ask them about any and all discounts available to you. Some might only be accessible after life-changing events such as getting married, buying a house or having a baby.
Improve your credit score
Having good credit will ultimately impact what you pay for car insurance, so maintaining a strong score is a must for maximum savings. Simple things like paying your bills on time and in full can go a long way, especially for younger drivers who typically cost the most to insure. Establishing solid credit will pave the way to affordable car insurance.
Ditch unnecessary coverage
In the states that require car insurance, most only mandate liability coverage, leaving it up to the driver to buy collision and or comprehensive. While both of these are great for new cars with high assessed values, as depreciation kicks in, you may end up overpaying for coverage you won’t benefit from with an older car.
This is why you should ask your insurance agent what they assess you car’s value to be. If your premiums for collision and comprehensive are more than 10 percent of that value, you’re probably overpaying and should consider dropping those in favor of saving money for a newer car.
Raise your deductible
Your deductible is what you’re required to pay out-of-pocket before insurance kicks in should you file a claim. By raising this, you can actually save money on your premium payments. This is a great way to save if you’re a safe driver with a nearly accident free driving record.
However, understand that by doing this, you will be required to pay more out-of-pocket if you get into an accident.
Consider a usage-based car insurance program
These are becoming more popular, especially as technology advances, to accurately bill drivers for their driving behavior and frequency. Most usage based car insurance programs use data collected from a car’s onboard diagnostic port to determine how much you drive, how you drive and when you do most of your driving. If you travel less than say 12,000 miles a year, have a good driving record, and avoid late-night motoring, chances are you can save a substantial amount of money on your car insurance by opting into these programs.