6 Tips for Lowering your Car Insurance
Driving a car is one of the biggest expenses a person has. When you consider the cost of repaying the loan used to purchase the vehicle, gas and maintenance and then add on top of all that, the cost of insuring the vehicle and its drivers, the total really adds up, easily costing between $10 and $20,000 a year. You can eliminate this expense all together by ditching your ride and using public transportation, but this is not an option to some in areas where public transportation is not accessible. One great way to reduce the amount you are paying each year to drive is to cut the cost of your auto insurance, here are a few ways you can easily do so.
Get rid of the coverage you don’t need. Take a look at your coverage plan and see if there are any items that you feel are “too much.” You may have way more than necessary in the means of liability insurance. If you have health insurance then you don’t need full coverage on yourself as well through your auto plan, that is considering “doubling up” on insurance and is simply a waste of money. You will only be using one form of insurance if you have to go to the hospital and by eliminating this from your insurance bill, you can reduce your monthly premium.
Reduce your Deductable
We set up our insurance plans in a way where we are preparing to use them should the necessity arise, that’s what insurance is there for; however, most of the time, we do not end up using it at all, if we are lucky. If you have a low deductable, then you will pay less out of pocket when you do get in an accident, but your monthly payments will be much greater than if you had a higher deductable. By increasing your deductable, you can cut your premium by sometimes up to 30%, depending on your policy and the amount you increase it to. You run the risk of paying more out of pocket should something happen, but you pay less overall.
If you are a good and safe driver, many auto insurance companies offer discounts for safe driving that you will probably qualify for. If you have a good clean driving record, shop around and see if you can find the policies available with the most rewards, and review any policy that you currently have to make sure that you are being charged accordingly.
Drive a Car that is More Cheaply Insured
There is a big difference between insuring a Mercedes and a ford, not that either one is better or lesser so to drive, but there is a drastic difference in the cost to insure each vehicle. If you are shopping around for a vehicle, take this into consideration before you purchase the vehicle. If you are looking at a more expensive model, even if you get it at a great deal, it may end up cost you way more than you anticipate in insurance costs. There are a lot of really great cars out there in a variety of price ranges, try and find one that is sensible and won’t cost you an arm and a leg to insure.
There is a reason insurance companies ask your mileage, the more you drive, the more opportunity you have to get in an accident. If you reduce the amount that you drive per year, by say carpooling or taking the bus to and from work or school, you can reduce the amount you are paying for your car insurance considerable because you are reducing the likelihood of having to use it at all. Period.
Drive a Safe Vehicle
It is true that most vehicles these days come with many safety features, and car companies around the world are constantly developing new systems to make driving safer, however, this hasn’t always been the case. If you are purchasing a car, another thing to consider is its safety features. If you find a car that has airbags throughout and anti-lock brakes, it will cost you much less to insure than one without because the risk of injury should something like an accident happen, is much less. You may save more upfront by buying an older used car, but because of its lack of safety technology, you could very likely end up paying more in the long run.
George Gallagher writes about financial concerns and money for a variety of online publications. He also works in the student loan consolidation space helping students find credit unions that offer better options than for-profit banks.