If you’re going to be a legal driver, you need car insurance. Unfortunately, good insurance can be quite expensive. Added on top of a car payment, gas, and maintenance, it can make driving very costly. However, there are plenty of ways to lower the insurance rate you pay. Are you aware of them?
6 Ways to Lower Your Rate
The car insurance industry is as competitive as any consumer goods marketplace. Drivers have dozens of companies and hundreds of policies to choose from. While overwhelming, this is also good news. It gives you leverage to find the best possible deal.
Want a lower rate? You’ll have to take some initiative and be proactive about the situation. Here are a few specific ideas:
1. Stay Accident-Free
Every insurance company has certain factors within their systems that you can’t change. For example, if you’re a 24-year-old male, you can’t just suddenly change your age and gender and fall into another category. But there are plenty of factors you can influence – including your driving record.
By avoiding traffic tickets and auto accidents, you can maintain a clean record and show insurance companies that you’re a lower risk than other people within your same category. This lets you enjoy access to lower rates.
2.Choose the Right Amount of Coverage
“Deductibles are what you pay before your insurance policy kicks in. By requesting higher deductibles, you can lower your costs substantially,” Insurance Information Institute explains. “For example, increasing your deductible from $200 to $500 could reduce your collision and comprehensive coverage cost by 15 to 30 percent. Going to a $1,000 deductible can save you 40 percent or more.”
Speak with your current insurance provider about some of the different options you have. Ask for quotes at different deductible amounts and then spend some time studying the different coverages.
3. Shop Around
With so much competition on the market, it’s wise to shop around for rates every couple of years. Not only will you find lower rates, but you’ll also find unique offerings that your current insurance provider may not provide.
For example, one car insurance provider actually offers premiums that decrease on a monthly basis. Considering that the rest of the industry does the exact opposite, you may find this appealing. Other insurance providers offer safe driving rewards that actually refund you money based on a clean driving record. Little things like this matter.
4. Purchase a Different Vehicle
Car insurance actually goes with the vehicle, not the driver. So it’s not just your driving record and risk factors that matter, it’s also the vehicle.
Personal finance blogger Erin Huffstelter tells people to, “Choose a car with added safety features like airbags, anti-lock brakes, electronic stability control and automatic seat belts, and your smart choice will be rewarded with another discount.”
You can also trade out an expensive vehicle for one that’s worth less, and you won’t need nearly as much insurance.
5. Look for Discounts
Insurance companies are essentially using data and trends to make safe gambles and bets on which clients are more or less likely to be involved in accidents. In order to attract safer drivers and vehicles with lower risk factors, insurance companies often present discounts to people who qualify. Examples include discounts for taking defensive driving courses, installing anti-theft devices, maintaining low annual mileage, maintaining good grades (students), etc.
6. Bundle Insurance Products
You may be able to further lower your car insurance rate by bundling different insurance products together – such as home insurance, life insurance, boater’s insurance, disability, and even health insurance. Ask your insurance provider about these discounts and see if there are ways for you to save even more. If there aren’t any discounts available, look around for an insurance provider that provides this option.
Lower Your Rate Today
Lowering your car insurance rate doesn’t have to be some long drawn out process that evolves over a period of months. It’s as simple as picking up the phone, pulling up your favorite internet browser, and doing some research. If you find a rate that’s friendlier than the one you currently have, you can simply make a switch.
Stop pouring money down the drain and start paying a fair and competitive rate that’s reflective of your driving abilities.