The Top Ways to Lower Your Car Insurance Premium

You need car insurance to drive a car – it’s the law. But just because you need it doesn’t mean you have to overspend on it. There are ways that you can control the amount of your premiums. If you’d like to save money on your car insurance, keep reading.

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Take a Higher Deductible

All car insurance plans have a deductible. You must meet this amount before the insurance company will help with your claim. You’ll find that each insurance plan has a different deductible. Did you know that you have options, though? If an insurance agent quotes you a $1,500 deductible, for example, you can ask for a lower deductible.

The reverse is also true, though. Let’s say an agent gives you a quote for insurance with a $500 deductible, but you know you can afford a $1,000 deductible. You can ask the insurance agent for a quote with the higher deductible. The more you can afford (if something happens), the lower your monthly premiums become. The insurance company takes a lower risk of making a payout when you have a high deductible.

Use caution when using this trick, though. Don’t take a deductible that you can’t realistically afford. Look at the big picture and choose one that you can afford easily, even if things changed financially. You can always adjust the deductible before your next renewal period, too, so you aren’t stuck with one choice.

Don’t Overbuy Coverage

The law requires you to have liability insurance – that’s non-negotiable. But, comprehensive and collision insurance aren’t required. If you drive an older or beat up car, it may not make sense to pay for comprehensive or collision insurance. The premiums may add up to more than the car’s worth. Rather than paying for unnecessary insurance, you can lower your premiums and put the money aside to buy a new car should you get into an accident or need a new car.

Bundle Your Policies

If you have other insurance policies, consider buying them all from the same insurance company. They often provide discounts for ‘bundling your policies.’ In other words, buying more than one policy from the same company saves you money. Insurance companies do this for their own good, but you benefit in the end as well. Insurance companies save money on advertising and finding new clients when current clients purchase more than one policy, so they pass along the savings to you, encouraging you to keep your policies with them.

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Research Insurance Prices Before Buying a Car

Just because you love a car doesn’t mean that you’ll love the insurance premiums on it. Before you settle on a make and model, call around to a few insurance agents and find out the cost. You may be unpleasantly surprised at the amounts you hear. If you find the premiums too much, consider a different type of car with lower premiums

Have a Good Driving Record

Your driving record directly impacts your insurance premiums. Even one accident or one moving violation can increase your premiums with your current insurance company or a new one. If you do get into an accident (you are at fault) or get a ticket, you may be better off staying with your same insurance company. There’s no guarantee that new companies will accept your application for insurance if you have a risky driving history.

Have Good Credit

Your credit lets insurance companies know your level of risk. Bad credit signifies irresponsibility behind the wheel, even though driving has nothing to do with your credit. Insurance companies use your credit score as a determination of how much risk you are to the insurance company. They want clients that have a low risk of filing a claim and those clients typically have high credit scores.

Using the above tips, you can lower your insurance premiums, even if just slightly. The best thing you can do is shop around with several insurance companies. Get quotes for the same type of coverage from each agent and compare them side-by-side. Finding the insurance that is affordable, yet reputable will give you the best results.

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