A couple of months ago we discussed the various types of auto insurance available and what coverage levels you should have for proper protection. This month Autosource wanted to give you some tips on shopping for the best deal on auto insurance. Finding a new policy will involve some work, calling agents and filling out forms is never fun but if you can save hundreds of dollars a year, the time you invest will be well spent. Here are the best methods for find a great policy at a price you can afford:
Determine Coverage Levels
Before you pick up a phone or fill out a form online, determine what coverage levels you want. Everybody has different needs when it comes to car insurance. If you are driving an older, lower value vehicle you may want to opt out of collision coverage. If you are unsure or have questions about coverage’s check our Insurance Coverages and Levels tips. If you are a leasing a vehicle or have a bank loan against it, your lender will require you to carry full coverage. When you have figured out what coverage levels you want its time to start shopping.
Review Your Credit and Driving Records
Your credit rating will affect your insurance premium. Pull a credit report before you start shopping and make sure there are no mistakes or surprises that are lowering your credit score. If you find an error, try to get it resolved before you look for a new policy. Your driving record will also affect your premiums so ask check with your local DMV to see what is on your record. If any points are about to be removed from your record, wait until they are gone before changing insurers.
Shop Around
Experts agree that the best way to save money on insurance rates is to shop around. Insurance companies rate risk differently. While one company may ding you for a speeding ticket, another may overlook it, or at least not penalize you as much. The way companies rate risk will directly affect your rate quotes. Finding the company that offers you the best rate will take some time. It is best to allot at least two weeks for you insurance search. Get a minimum of 5-10 quotes from a variety of vendors. Shop companies direct as well as checking with independent agents.
Use Consolidators
Consolidator sites like Carinsurance.com, Esurance and NetQuote are great for getting lots of quotes while only filling out one form. These sites pull quotes from a variety of insurance companies as well as independent agents.
Ask for Car Insurance Discounts
Insurance companies give discounts for a number of reasons; a few of the more important ones are listed below. When talking to an agent or customer service rep, ask them if you are getting all available discounts. Make agents aware that you are shopping around and will be comparing their prices against the market.
- Multiple Policies Discounts – Insuring your home and car with the same company should result in a discount on both policies. The discount will vary but expect at least 5%. If you are insuring more than one car, ask for a multiple policy discount as well.
- Defensive Driving Course – Passing a defensive driving course should result in up to a 15% discount on your auto insurance. If you have a teen driver on your policy, a defensive driving course is a great way to help lower their sky-high rates. These courses are not expensive and can usually be taken in an afternoon. Check with your insurance company for approved providers.
- Teenage Drivers - Teenagers cost a fortune to insure. In addition to a defensive driving course there are other ways to lower premiums associated with your young driver. A good student discount can range from 10-15%. Most companies require a B average. Keeping your teenager in your cheapest vehicle is another good way to lower your prices.
- Paperless Bills – If you receive your bills and statements online your insurance company will give you a small discount. The discount is not huge but every little bit helps.
- Theft Deterrence – Cars that are equipped with anti-theft devices will cost less to insure. More serious features such as lo-jack or a GPS tracker can up your discount amount. If you have these features installed, be sure to notify your insurance company.
Discounts are just one way to lower your premiums. The following methods will require a little sacrifice on your part, but they can help keep some money in your pocket.
Higher Deductibles
Higher deductibles will lower your monthly payment. Keeping your deductibles as high as you can afford will save money. Keep in mind though that if an accident does happen, you will be on the hook for the deductible amount so make sure you can afford it.
Review Your Coverages
Only pay for the coverage’s that you need. If you are driving an older low value vehicle, drop collision. Review your coverages on a regular basis and make changes if necessary.
Life Changes – Life situations can change and they do affect insurance rates. If you switch jobs and your commute is suddenly cut in half, check with your insurance company if this will affect your rates.
Review on a Yearly Basis
Review your rates on a yearly basis. When your policy comes due for the year, its time to shop around again. Getting new quotes on a yearly basis will ensure that you are paying the lowest premiums possible.
Shopping for insurance is almost never fun, but it is a necessity. If you find yourself getting bogged down, take a break for a few days and pick up the search when you are ready. Thinking about the money you will save can help keep you motivated. Now that you know how to save some money on your insurance, its time to get out there and start shopping.
