If you drive, then car insurance is a simple fact of life. Only three US states do not require insurance, and there are additional costs in each case that must be paid to the state in lieu of carrying coverage. In most cases, you are required to carry a certain level of liability coverage. In states with no-fault laws, the requirement is for a special type of no-fault coverage that will pay out regardless of blame during an accident.
While insurance is important and often legally required, it is also costly. Between loan payments, maintenance, and gas, car ownership can already be wildly expensive, so car insurance has the potential to be a great place to save some dough. If you think your rates might be too high, these four tips may help you to bring them back under control.
Most car insurance policies provide six-month terms. This short coverage period is the insurance company's way of saying that they want to regularly reevaluate your risk and potentially adjust your premiums, but you can use it to your advantage as well. There's no better time to shop around for lower rates than when your coverage is just about up, so be sure to check with other insurance companies when your policy is about to end. Changes in your driving record or credit score can potentially affect your premiums, and it can often be easier to get a better rate by jumping to another company than waiting for a discount from the one that you are already with.
Be Aware of Other Drivers on Your Policy
Your auto insurance policy doesn't just cover you; it also covers other drivers in your household that may drive your vehicles. This is important to keep in mind because there may be factors relating to those other drivers which are increasing your premiums. While the insurance company won't pull their credit histories, it will check their driving records and demographic details against the company's actuarial tables. This means that a poor driver who is living with you might secretly be causing your rates to go up. Luckily, you can choose to actively exclude drivers from your policy. If your driving record is much better than the records of the people you are living with, this will likely net you some major savings.
Carefully Consider Your Deductibles
Deductibles on collision and comprehensive are two of the easiest places to save some money on your monthly premiums. Of course, the trade-off is that damage to your car which is not caused by other drivers has the potential to be more costly. Many drivers opt for lower deductibles to save some hassle, but it's worth it to step back and consider your long-term costs and how often you expect to make claims against your policy. If you save $50/month by upping your deductible another $500, then you will make that money back in reduced premiums in just ten months. In cases like this, it makes more sense to reduce your coverage and simply set some money aside for disasters.
Talk to Someone
Perhaps the most important thing you can do to improve your rates is to talk to an actual human being. This is true even when dealing with major companies, and you can sometimes get certain negative factors to remove or reduce in order to snag a lower premium. Local or regional insurers can usually offer competitive rates as well, and one of the main advantages of working with these smaller companies is that it's easy to talk to and negotiate with a real human being.
Auto insurance is something that all drivers need to deal with, but with careful planning and a few tricks, you can potentially save hundreds of dollars per year on your premiums.To learn more about your insurance, contact local insurance companies to get an insurance quote.