We Reveal 17 Tips To Lower Your Car Insurance!

Lower Your Car Insurance

Buying auto insurance is one of those things that are just a fact of life for responsible adults, like paying the electric bill or buying groceries.

Most people, in fact, will stay with the same auto insurance carrier for years at a time without putting a lot of thought into it until the premium statement comes, when they sigh over the cost and write out the check.

There are, however, numerous ways to keep the cost of your car insurance down and reduce what you're currently paying if you look into some options and are willing to shop around a bit. If you're looking to save money on your premiums, consider these options that can net you savings ranging from $10-$500 dollars a year: 



Raise your deductibles

Many people think it’s worth it to pay a higher auto insurance premium in exchange for a lower deductible (the amount you have to pay before the insurance picks up expenses if you are in an accident). This isn’t always the case, especially if you can afford to pick up a deductible when an accident happens.

Look at it this way – most people only have an accident once every ten years. If you look at what you will save by raising your deductible from $200 to $500, then times that by the ten years, what is the comparison? In many cases you can save up to 25% on your premiums by raising your deductible just $300. Keep in mind, however, that if you do have an accident you’ll need to be able to come up with the deductible amount when you need it.

Reduce your coverage

If your car is more than ten years old or is worth less than $3,000 (check www.kbb.com for an estimate of your car’s current value), consider doing away with comprehensive and collision insurance. These are car insurance coverages that provide for repair and/or replacement for you. If your car isn’t worth a significant amount, the auto premiums may not be worth it. Take into consideration, though, whether you can afford to be without the car if it is totaled.

Combine all of your insurance with one provider

Some companies offer lower car insurance than others, but be sure before switching that you can’t get a better deal from the same company that insures your home. Many companies will give you a break on your auto insurance if you also insure your home with them. The same goes for having more than one car – if you have your automobiles insured by two different carriers, you’re likely paying a higher premium than if you combined with one or the other. Ask your insurance company about “multi-policy” discounts and see how it compares to splitting them up.

Low mileage can mean auto insurance savings

Do you only drive your car around town a few days a week? Do you carpool to work? Both of these mileage savers can equal premium savings, but not all insurers think to mention this to you. Be sure to inquire about these low-use price breaks.

Check with your employer and other organizations

Some companies and most auto clubs offer group car insurance rates if you purchase through them. Don’t forget to check alumni groups, service organizations and others – you could be surprised by what you find. AARP is one such organization that can give you a great alternative if you are a member over 55.

Improve your credit rating

One of the secrets that most auto insurance companies don’t share with their customers is the effect bad credit can have on your premiums. If you’re thinking of shopping around and your credit isn’t good, spend a few months repairing your credit before making the switch. If you have a lot of recent, high end purchases or have recently fallen behind on payments, make it right and check to see that your credit report is current before looking for a better auto insurance deal.

Look for discounts

There are lots of them available. Nothing varies more than the types of discounts available from company to company. Don’t compare rates until you’ve asked each provider about all of the potential discounts available and how much they will affect your premiums.

Some discounts to ask about include:

  • Having no moving violations in the past 3-5 years. Insurance companies like those they consider “low risk” drivers, and if you have a clean record they may reward you.
  • Being over 50-55 – a group that historically has fewer accidents.
  • Having daytime running lights
  • College students away from home
  • Being a long-time customer
  • Having airbags
  • Student drivers with good grades

Keep in mind that some of these will be available while others won’t, depending on the state and insurance carrier.

Take a driving class

Companies view individuals who are willing to take a driver’s safety course as more reliable and more dedicated to driving defensively. Contact your local DMV to ask about Driver’s Safety courses in your area.

Take teen drivers into consideration

One of the most expensive groups to insure is teen drivers, so make sure you take all of precautions necessary to keep costs low for your teenager when he or she gets a license.

In most states, if you have as many cars as drivers and one is a teenager, the teenager must be a primary driver on one of them, and they will generally want it to be on the most expensive one, regardless of which one he drives. This can raise your premium significantly, so consider this before getting a second or third car for a teen’s sole use. If you must get your child a car, an older, safer vehicle that you can carry minimum coverage on is the way to go.

Check into alternatives if you have multiple drivers and one is a teen. If you have two cars (yours and your husband’s), and a third that is for your teen, consider getting a separate policy for his or her vehicle. This keeps him on the least expensive vehicle rather than the most expensive. He will still be covered as an occasional driver on yours. There are a few restrictions to this – the car will have to be free of any liens, for one thing. For another, he will need to consistently be using that car himself.

Also look into discounts for teen drivers. These can include ones for good grades, taking driver’s education (offered at many high schools) and for college students away from home (if within a certain distance).

Don’t buy a car that is costly to insure

This applies when you are buying a car, which is also an excellent time to review your insurance policies in general. The rule of thumb is that sports cars and many luxury cars are more expensive to insure. Insurers will look at the sticker price, repair costs, how likely it is to get stolen and the proven safety record of an automobile.

If there’s a difference of only a few thousand dollars between two different cars you are seriously considering, check with your insurance provider and see if there is a difference in the premiums, then calculate it out over the time you plan on owning the vehicle.

Review your coverage at renewal time

Things change over time. Cars get older, people get older, and credit ratings and accident records change. When it is time to renew your policy, contact your agent and ask whether you can take advantage of any discounts you hadn’t qualified for in the past. Don’t forget to ask about your driving record (if it is clean), your age (if over 50) and changes in your style of driving (working from home instead of driving into the city, for instance).

Also check the fair market value of your car – if your car has aged to the point that it isn’t worth keeping comprehensive and collision insurance, it may be time to drop these coverages. Many people forget to do this as a car gets older.

You should also let your insurer know that you may be shopping around for the best deal possible. If you’ve been with a company for years and have a good record, they may offer a “renewal discount.” After all, you’ve been a good customer and they won’t want to see your leave. If they can retain you by offering an incentive, they may do it.

A safe car is a better risk

There can be a savings on your auto premium for installing anti-theft devices on your car, having airbags, anti-lock brakes and a number of other safety features. Mention all of these, and if you add anything that makes the car safer be sure your insurer is notified of the changes.

Let the woman drive

No, we don’t mean all the time or instead of the man. However, it’s a proven fact that women tend to be safer drivers than men, with fewer moving violations and accidents. If you and your spouse each have a car, let the female drive the car that will be more expensive to insure as the primary driver rather than the other way around.

Ask about “Forgiveness”

When comparing rates, ask auto insurance companies about what is usually referred to as “first accident forgiveness.” While your rates will usually go up when you are in an accident in order to defray the costs of pay-outs like yours, some companies will waive this for a first accident, especially if you have been a faithful customer.

Pay your premiums yearly

In most cases, companies will offer you the option of a variety of payment plans, including yearly, monthly or quarterly. Don’t jump on payment plans that are spaced out without asking about any surcharges. There’s often a fee for the additional administrative costs in exchange for breaking premiums down. The more you divide them up, the higher this charge could be.

Don’t lend out your car needlessly

If you loan your car to lots of people you increase the chances that someone else will wreck it. It’s nice to be trusting, and we all want to believe everyone else will be as careful as we are, but that’s not always the case. Unfortunately, if your friend is in an accident in your car, you’ll be paying for it in increased premiums, not him. Read: How to get the best Gap Insurance

Keep your driving record clean

You don’t ever have to have an accident to get your rates increased. In some cases, repeated moving violations (including speeding tickets) can raise your rates more than an accident would. Why? Because it indicates an increased likelihood that you will have an accident.

If you shop around and ask the right questions, you should be able to find the rate and coverage package that suits your needs. The key is to be an informed consumer and understand what your individual needs are when it comes to auto insurance coverage. If you approach at least three different companies with the information above, you should find a package that will fit both your needs and your budget.

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