Saving on Car Insurance: 7 Smart Ways to Lower Your Rate
If you own a vehicle, car insurance is a must that will help you a lot in case you have an accident or any damage to your car. However, you don’t have to spend more money than necessary on good insurance. If you know which factors affect your insurance rates, you can save a lot of money and still get great coverage. Here are the best ways to minimize car insurance rates and maximize protection:
Be a good driver
First things first, fix your driving. Tickets and accidents can drive up your premiums like crazy. In case you get a ticket, see if you can go to traffic school and get it dismissed or at least reduce the number of violation points. If you can keep tickets and accidents off your record, it will save you hundreds of dollars over the years. Also, try to minimize your driving. Car insurance rates are usually lower for infrequent drivers, because the more time you spend on the road, the bigger the chance of accident and damage.
Pick the right car
Before you start looking for new cars, check the rates and how they go for models you have your eye on. The type of car you drive can affect your car insurance premiums, especially if you invest in comprehensive and collision packages. Vehicles like minivans and small SUVs always have cheaper insurance than fast and fancy cars, this is important to know about car insurance.
Shop around
Your impatience can cost you hundreds of dollars a year—this is the difference in car insurance rates among insurers. So do your homework by comparing rates. If you find the cheapest insurer and are a driver with a clean record, you can save more than $100 a month on insurance. However, the company with the lowest rates in one state doesn’t need to be the cheapest in the entire country or might not be the cheapest for a bad driver, so compare all the factors.
Take advantage of discounts
Most insurance companies offer various ways to lower your rates, so make sure to ask your agent to review your savings and ensure you get all the discounts possible. For instance, some insurance companies offer discounts based on coverage options, lifestyle, vehicle type, miles and driving record. You can get a discount anywhere from 5% to 35% on things like automatic premium payment setup. Pro tip: just because you get many discounts, it doesn’t mean you will get away with the best deal on the market.
Pay attention to GAP insurance
In case your car gets stolen or totaled, your regular insurance will only cover the value of your vehicle at that moment. This means you have to cover the difference between your car loan and the car’s value on your own. However, this is where GAP insurance might come in handy. It will supplement the payout you get in case your car is kaput. Some even cover your insurance deductible.
However, GAP insurance can only be given to those with comprehensive car insurance. If you don’t have that and you were still sold GAP insurance, you should find professionals to get a GAP insurance refund and put money back into your pocket. Your hired experts will work with the insurance provider, help you cancel the policy and award you with your refund.
Improve your credit
Your credit score plays a big role with car insurance companies, especially when they calculate your rates (sometimes even more than your driving record). To improve your insurance coverage and rates, you should boost your credit score by making all your loan and credit card payments on time, keeping your credit card balance below your limits and minimizing the number of credit accounts. Too many credit cards can ruin your credit score so reach for them only when completely necessary.
Boost your car’s safety and security
If you make an effort to keep your car safe and secure, your insurer will offer you better premiums. So whenever possible, keep your car in a secured garage or driveway instead of on the road with easy access to thieves and vandals. You can also lower your rates by investing in additional security features. Things like alarms and trackers will help you out here. Also, make sure to provide your parking spot with a spotlight to make it less attractive for bad guys.
It’s very important to keep your car safe, but you don’t have to overpay for these services. If you do your homework and do your best to be a responsible driver, you can achieve the best rates with the best coverage.
By Mike Johnston