Everyone wants to save on car insurance rates. However, you might not know exactly where to start. Getting the lowest rates takes time and a commitment to detail. In fact, there are multiple ways that you can work proactively to get beneficial rates. What are some of these?
In some ways, you cannot change what you pay for car insurance. In others, you can do a few things to help yourself qualify for lower rates over the years.
1. Maintain Good Credit
Your credit score is an important measurement of your financial solvency. To money lenders, good credit means that they can count on you to repay your loans. However, credit scores are an important risk measurement that many insurers will look at when setting your premiums.
If you have credit, it has a couple implications. First of all, it might help the insurer know that you will pay your premium on time. That could reduce the chances that your policy will ever lapse and the insurer might be able to offer you a lower rate.
Second, the better your credit, the better the chance that you might be able to pay for vehicle losses on your own. That could even reduce your risk of having to make a policy claim at all. Therefore, your risks to the insurer might drop (and your premiums might follow).
2. Pay Off Your Vehicle
When you buy your car, you will likely take out a loan and pay off the balance over time. As long as you have that loan, your bank or the dealer might require you to carry certain amounts of coverage. Usually, they will require you to have collision and comprehensive coverage to pay for the damage to the vehicle in a wreck.
However, once you pay off the loan, the choice of whether to keep these types of coverage might be yours alone. You might opt to drop coverage because the vehicle's value no longer makes carrying such protection conducive. Or, you might simply adjust the coverage to account for the value of your used car as opposed to a new one. In either case, your insurer might be able to offer you a lower premium because you don't carry as much coverage.
Don't drop coverage arbitrarily, however. Our agents can help you determine what way is the right way to decrease coverage and still offer yourself ample protection in case of accidents.
3. Adjust Your Deductibles
When you look at your car's physical damage insurance, you'll likely see that it lists a deductible. Deductibles are a policyholder's personal financial responsibility for a claim's cost.
For example, your collision deductible might be $500. Therefore, if you have a wreck, you must pay $500 toward your car's damage before your policy will pay the remainder of the costs. For example, if you have $2,000 in vehicle damage, then you pay $500 and your policy pays $1,500 for the damage, since $2,000 (total claim) - $500 (your share) = $1,500 (insurance's share).
Policyholders can adjust their deductibles to suit their personal needs. Still, increasing your deductible means your insurer might decrease your premium. That is because you shift some of the cost of a claim from them to you. That's a lower cost risk for them. They might therefore not have to charge you as much money.
All the same, you should only increase your deductible as you can afford to do so. For example, if you can only afford a $500 deductible instead of a $1,000 deductible for damage, then you might choose the $500 cost. After all, raising your deductible might mean you have to pay more when a claim arises. You want to be able to afford to do so.
4. Ask for Discounts
Insurance companies frequently award discounts to customers who take advantage of incentives that reduce their risks. These can reduce your premiums by several hundred dollars each year. Some of the most-beneficial might include:
- Automatic payments discounts that allow the insurer to deduct your premium from your bank account as soon as it comes due. This reduces your risks of policy lapses.
- Policy renewal discounts that allow the insurer to renew your policy whenever it comes due. This means your policy will remain the same from period to period, unless you wish to make changes. Because they can renew your coverage automatically, the insurer can save costs and not have to worry whether you will or will not renew your policy.
- Safe driver discounts, which can kick in after you prove you have passed a safe driving course. Safe driving courses help you re-learn defensive driving techniques that make you less likely to have wrecks, and thus file insurance claims. As a result, you might no longer have to pay as high a premium after taking the course.
One of the most-important ways to save on your car insurance rates is to contact your Auto Insurance Discounters agent. We're here because we know that savings is important for every consumer. Don't hesitate to let us help you get yours.