How to save money on car insurance
Having adequate car insurance is both smart and prudent, but there's no question that it adds to the expense of driving. The good news is that premiums can vary by hundreds of dollars depending on a number of factors. Review your coverage at renewal time to make sure your insurance is in step with your needs, and follow these practical steps to reduce the bottom line on your auto policy.
• Compare insurance costs before you buy a car. Auto insurance premiums are based in part on the car’s price, the cost to repair it, its overall safety record and the likelihood of theft. When you're comparing new or used vehicles to purchase, also research what each will cost to insure.
• Raise your deductible. By choosing a higher deductible on your car insurance, you can significantly lower your premium costs. Of course, be sure you have enough money set aside to pay the higher deductible in the event you have a claim.
• Reduce optional insurance on your older car. As a rule of thumb, if your older car is worth less than 10 times the insurance premium, having collision and/or comprehensive coverage may not be cost effective.
• Bundle your insurance and/or stick with the same company. Many insurers will give you a discount if you purchase two or more types of insurance from them—such as homeowners and auto—or have more than one vehicle insured.
• Seek out other discounts. There are other discounts that your insurer may offer to policyholders. For example, some companies offer discounts to those who've not had any accidents or moving violations during a specified period, or who have taken a defensive driving course. If there is a young driver on your policy who is a good student, has taken a drivers education course or is away at college without a car, you may also qualify for a lower rate.
