The average car insurance premium in the US is around $1,548 per year. With household costs rising, this can be a crippling expenditure for most drivers. So how can you keep costs down?
There are several ways you can get cheaper policies. Read on as we give our essential tips on how to lower car insurance rates.
1. Boost Your Credit Score
Your credit score has a direct impact on your insurance cost. The better the credit rating is, the more likely you are to get a car insurance low rate. As a good score can help you in many other ways, it pays to take time to improve it.
Start by making payments on time. After this, pay down any existing debts so that you are at less than 20% of your existing credit. Even if you do have good credit, check your report to ensure no mistakes have been made.
2. Use Discounts
You can get low car insurance rates by utilizing many of the discounts on offer. The problem is that many insurance companies don’t advertise what is available. This means you may have to ask the company yourself.
One popular way is to get multi-car discounts. If you have a number of drivers and vehicles in your family, it can be cheaper to get them all insured through the same company. As more policies are more valuable to them, they may be willing to provide a discount.
Larger companies may also go one step further. Should you have life insurance or home policies, they may let you bundle them all into one.
3. Shop Around
There can be major price differences between insurance providers. Even by providing the same information, one company may value certain criteria more than others. As a result, you can end up paying much higher with one firm than you would with another.
To get the best low-rate car insurance, you need to shop around. Use comparison sites. Then find companies not listed on them and go direct.
Ideally, you need to get quotes from around four providers.
4. Take a Defensive Driving Course
Defensive driving courses have a number of advantages. Not only can they reduce the number of points on your license, but they can also get you a bonus discount with some insurers.
If you already have an insurer, then ask if the class will benefit you. You need to decide if the expense on the course will justify the reduction in the premium.
You should also make sure you are signed up for an accredited course. Each state will have its own rules regarding this, so check the rules in your area.
5. Raise Your Deductible
The deductible is the amount you pay before your insurance premium kicks in. For example, if you had $2,000 of damage done to your vehicle and a $500 deductible, you would pay for $500 of damage. The rest ($1,500) would be provided by the insurance company.
When you raise your deductible, you have to pay more in the event of an accident. This takes the onus off the insurance company and they can give you cheaper rates. Make sure you are able to pay any deductible from savings or income should an accident occur.
6. Change Your Car
One of the major considerations when getting insurance is the vehicle itself. Cars with low insurance rates do exist, though there are a lot of factors that make up how much cars are insured for.
For example, some cars are more likely to be stolen than others. Repair on some cars can cost more or the replacement of parts can be more expensive. Also, the size of the engine can dictate the insurance as faster sportier models are more likely to be involved in crashes.
7. Drive Fewer Miles
When you fill in the form that decides your insurance price, you will be asked how many miles you travel in a year. This is because companies have thresholds, and if you are in a lower bracket, you may end up getting a discount.
You do generally need to travel a lot less to incur a discount. People who commute to and from work every day may not benefit. Yet if you only do a few miles in a week, you will probably qualify.
If you already have an existing policy, ask the provider about mileage thresholds. They may have overlooked and not included you for a previous discount.
8. Drive Safely
The safer you drive, the better insurance quotes will get. Some providers can provide discounts of almost 25% if you are a safe driver who has had no accidents or claims in the past. As in-car distractions increase, it becomes important you keep your eyes on the road.
You don’t just have to have been involved in accidents either. The fewer points are on the license, the better the premium will be. Keep points down by cutting back on traffic violations like speeding.
9. Change Your Coverage
Just because your provider offered the best low-rate car insurance last year, does not mean they will this year. You may find that your needs change. Perhaps you get a different car or you improve your driving record.
Review the insurance every time it needs renewing. Shop around and see who makes the best offer. You can take them up on it, or ask your current provider if they can match it for you.
Finding Lower Car Insurance Rates
Now you have our tips for lower car insurance rates, plan in advance. Improve your driving, get better credit scores, and then shop around. If you are buying a new vehicle, it may even be better to check rates before you buy.
We have many informative articles just like this one, so check them out. We can help you make household savings in the coming year.