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How To Save Money Buying Auto Insurance?

December 16, 2008 | Insurance | No Comments

The price you pay for car insurance can vary by hundreds of dollars, depending the insurance company, the type of car you have, your driving record, where you live, etc.

Below are some techniques you can use to save money.

Shop Around

Get at least three quotes because prices vary from company to company.  The Internet makes it easy to easily and quickly get quotes.  You can always call the the companies directly.

Remember not to shop by price alone. You want a reputable company that you can rely on if you ever have to file a claim. You can ask friends and relatives for their recommendations of their insurance company.

Purchase a Policy with a Higher Deductible

Deductibles is the amount of money you pay before your insurance policy kicks in. By requesting higher deductibles, you will lower your insurance premium substantially. For example, increasing your deductible from $200 to $500 could reduce your collision and comprehensive coverage cost by 15 percent to 30 percent. Going to a $1,000 deductible can save you 40 percent or more.

Maintain Good Credit

Your credit rating may affect what you pay for insurance, so keep a close eye on it. Credit makes insurance rates more accurate, fair and objective. While the use of insurance scoring varies from state to state and company to company, it is a fact that drivers with long, stable credit records have fewer accidents than drivers who don’t. There are various Internet services that allow you to check your credit rating and provide tips on how to improve your score.

Seek out Safe Driver Discounts

Companies offer discounts to policyholders who have not had any accidents or moving violations for a number of years. You may also qualify for a cut if you have recently taken a defensive driving course.

Inquire about other discounts

You may get a break on your insurance if you are over 50 or in some cases 55 and retired or 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, generally at least 100 miles away.

Reduce Coverage on Older Cars

Consider eliminating collision and/or comprehensive coverages on older cars. It may not be cost-effective to continue insuring a car worth less than 10 times the amount you would pay for coverage.

Buy your Homeowners and Auto coverage From the Same Insurer

Many insurers will give you a discount if you buy two or more types of insurance from them. Also you may get a reduction if you have more than one vehicle insured with the same company.

Take advantage of low-mileage discounts

Some companies offer discounts to motorists who drive a lower than average number of miles per year. Low mileage discounts can also apply to drivers who carpool to work.

Inquire About Group Insurance

Some companies offer reductions to drivers who get insurance through a group plan from their employers, or through professional, business and alumni groups and other associations. Ask your employer or any groups or clubs to which you belong.

When shopping for auto insurance inquire about discounts for:

  • $500 deductible
  • $1,000 deductible
  • More than 1 car
  • No accidents in 3 years
  • No moving violations in 3 years
  • Drivers over 50-55 years of age
  • Driver training course
  • Defensive driving course
  • Anti-theft device
  • Low annual mileage
  • Air bag
  • Anti-lock brakes
  • Daytime running lights
  • Student drivers with good grades
  • Auto and homeowners coverage with the same company
  • College students away from home
  • Long-time customer
  • Other discounts

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