1.
Shop Around
Prices vary from company to company, so it pays to shop
around. Get at least three price quotes. You can call
companies directly or access information on the Internet. Your
state insurance department may also provide comparisons of
prices charged by major insurers. (State insurance department
phone numbers and Web sites can be found here.)
You buy insurance to protect you financially and provide peace
of mind. It's important to pick a company that is financially
stable. Check the financial health of insurance companies with
rating companies such as A.M.
Get quotes from different types of insurance companies. Some
sell through their own agents. These agencies have the same
name as the insurance company. Some sell through independent
agents who offer policies from several insurance companies.
Others do not use agents. They sell directly to consumers over
the phone or via the Internet.
Don't shop price alone. Ask friends and relatives for their
recommendations. Contact your state insurance department to
find out whether they provide information on consumer
complaints by company. Pick an agent or company representative
that takes the time to answer your questions. You can use the
checklist on the back of this brochure to help you compare
quotes from insurers and on the same coverage.
2. Before You Buy a Car, Compare
Insurance Costs
Before you buy a new or used car, check into insurance costs.
Car insurance premiums are based in part on the car’s sticker
price, the cost to repair it, its overall safety record, and
the likelihood of theft. Many insurers offer discounts for
features that reduce the risk of injuries or theft. These
include daytime running lights and anti-theft devices.
3. Ask for Higher Deductibles
Deductibles are what you pay before your insurance policy
kicks in. By requesting higher deductibles, you can lower your
costs substantially. 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. Before
choosing a higher deductible, be sure you have enough money
set aside to pay it if you have a claim.
4. Reduce Coverage on Older Cars
Consider dropping collision and/or comprehensive coverages on
older cars. If your car is worth less than 10 times the
premium, purchasing the coverage may not be cost effective.
Auto dealers and banks can tell you the worth of cars. Or you
can look it up online at Kelley’s Blue Book. Review your
coverage at renewal time to make sure your insurance needs
haven’t changed.
5. Buy your Homeowners and Auto
Coverage from the Same Insurer
Many insurers will give you a break if you buy two or more
types of insurance. You may also get a reduction if you have
more than one vehicle insured with the same company. Some
insurers reduce the rates for long-time customers. But it
still makes sense to shop around! You may save money buying
from different insurance companies, compared with a
multi-policy discount.
6. Maintain a Good Credit Record
Establishing a solid credit history can cut your insurance
costs. Insurers are increasingly using credit information to
price auto insurance policies. To protect your credit
standing, pay your bills on time, don't obtain more credit
than you need and keep your credit balances as low as
possible. Check your credit record on a regular basis and have
any errors corrected promptly so that your record remains
accurate.
7. Take Advantage of Low Mileage
Discounts
Some companies offer discounts to motorists who drive a lower
than average number of miles a year. Low mileage discounts can
also apply to drivers who car pool to work.
8. Ask about Group Insurance
Some companies offer reductions to drivers who get insurance
through a group plan from their employers, through
professional, business and alumni groups, or other
associations. Ask your employer and inquire with groups or
clubs you are a member of to see if this is possible.
9. Seek Out Other Discounts
Companies offer discounts to policyholders who have not had
any accidents or moving violations for a number of years. You
may also get a discount if you take a defensive driving
course. If there is a young driver on the policy who is a good
student, has taken a drivers education course or is at a
college out of the area without a car, you may also qualify
for a lower rate.
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Nine
Ways To Lower Car Insurance Costs