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10 ways to save money on auto insurance


Consumers tend to be fairly complacent with their auto insurance policies. However, like with most expenses there are steps that you can take to save money.

 

1. Shop around The information age has made an abundance of resources available to the knowledge-seeking consumer. When looking for a new policy it is no longer necessary to grab the clunky yellow pages and leaf through page after page of insurance companies. Instead, get online and gather as many quotes as possible.

 

2. Increase deductible Deductibles are what you pay out of pocket before the insurance company steps in. Increasing your deductible means that you are now assuming more risk -- resulting in greater cost savings. Increasing your deductible from $200 to $500 can reduce your premium up to 30 %. If you were to increase your deductible to $1000 you would save 40% or more. In summation, pick the highest deductible you can afford. It is best to pay out of pocket for the minor dings and dents on your car than to pay monthly for the possibility of damage.

 

3. Drive less Risk management is a cornerstone of the insurance industry. So it makes sense that most determinants of your auto insurance costs are risk related. The less time you spend on the road the less likely you are to get a ticket or get into an accident. Insurance companies provide 5-10% discounts for policy holders that drive less. There is also the more comprehensive pay-as-you-drive (PAYD) insurance option. With PAYD, premium costs are linked to the number of miles you drive. These low-mileage drivers can save 25-50% off their auto insurance costs.

 

4. Watch your credit Ah, the ubiquitous credit score. In this case, insurance companies use your credit to determine your risk profile. Studies have shown that drivers with higher credit scores make fewer claims. Also, those who pay their bills on time demonstrate greater stability thus lowering their risk in the eyes of insurers. 

 

5. Forgo the flashy car Make sure to consider the extra insurance costs of purchasing a more expensive vehicle. These vehicles tend to have higher repair costs as well as increased collision and theft rates. 

 

6. Add safety features to vehicle Don’t skimp when it comes to your vehicles safety features. Anti-lock brakes, airbags and automatic seatbelts can all reduce your premium.

 

7. Keep a clean driving record Generally speaking, those with better driving records have lower auto insurance costs. If your driving record is awash with traffic violations you will pay higher premiums. One way to be proactive regarding your driving record is to enroll in a driver’s education course. Many auto insurers provide voluntary driver’s education courses that upon completion result in a 5-10% discount.

 

8. Eliminate unnecessary coverage If you have an inexpensive car you do not need expensive protection. Drop the comprehensive and collision coverage for those older vehicles.

 

9. Bundle policies together Insuring multiple cars under the same insurance company can help you save on your auto insurance. Also, look into bundling your homeowners insurance under the same plan. Multi-policy discounts are a great way to streamline the process and save you money.

10. Discounts Don’t forget to ask about discounts: loyalty discounts for those who have been with the same insurance company for a certain period of time; good driver discounts;  good student discounts and AAA discounts.

 

 

 

 

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