The laundry list of expenses when it comes to vehicle ownership can seem never-ending. One expense that is a legal requirement to drive, but is something you hope to never need is car insurance.
You might have insurance through the same company you used since you started driving. And, you might be paying ever-increasing premiums. That doesn’t have to be the case. There are many ways to save money and keep great coverage.
One–Don’t Let Your Coverage Lapse
Letting your coverage lapse can have a significant impact on your premium. Not unlike how employers look at gaps in your employment history, insurance companies are leery of any gaps in coverage, especially the longer they are. On average, premiums increased by 8% with gaps shorter than 30 days. Longer than that, the average shoots up to a 35% increase.
Most major auto insurance companies also have branches or subsidiaries that handle homeowners, renters and/or other types of insurance. With nearly all of these, savings of between 5% and 25% can be found.
Take a close look at your specific policy coverages and see if it is at a level that makes sense to you. For example, if you are living in a dry area where lots of rocks or sand is thrown up by trucks, you might want to have more comprehensive coverage as you might be replacing windshields frequently. If you live in a wetter climate where that doesn’t happen as much, it might be worth it to save by not having so much coverage.
Many of the top insurance companies provide a discount of up to 10% for simply driving less. To get this discount might take a bit more work on your end, as some require either periodic reporting of mileages or signing up to have a beacon/sensor sent to you. Once you enroll in these programs, they are extremely easy and can save quite a bit of money.
Accidents happen. But in being extra diligent in trying to avoid them, your insurance rates will not increase because one and many companies will reward you for remaining accident-free for certain periods. Since nearly every policy requires prompt reporting of accidents, the severity of the accident and who is at fault can have serious effects on your premium.
Another way to save that requires a bit more of an active role is to complete a Defensive Driving course. Nearly every insurance company offers a discount with proof of completion. Best of all, you can complete this online (be sure to check with your carrier to make sure they accept the program you find). Not only will this save you money, but the knowledge gained from the course might also keep you accident-free.
This is something to consider when you are looking for a new car, but can also affect the one(s) you currently own. Request a few quotes based on the ages, makes, and models. Generally, the older the car, the lower the premium. If you have an existing policy, contact your agent to see if the premium can be “refreshed” with the current age of your vehicle.
Eight – Credit
Just like your ability to get a lower interest rate on lines of credit, the higher your credit score is, the more likely you are to find a lower premium. If you are working to restore or build your credit up, be sure to stay in contact with your agent as your score increases. (Beware the inquiry use may affect your score. Ask if it is a hard or soft (preferred) credit pull.)
Nine – Pay-In-Full
When shopping around, or researching within an existing policy, many companies offer discounts when a policy is paid in full for the coverage periods. Typically, this is six months or a year.
Ten – Your Age
If you are in your college years or around retirement, there might be a discount that you qualify for. Generally, younger drivers can qualify for discounts based on their grades. Older drivers (usually 55+) can qualify for up to 10% in savings.