No one wants to overpay for car insurance. Here are seven ways to pay less than your state’s average driver.
- If you haven’t purchased a car yet, do your due diligence and compare insurance prices for each car model that you’re interested in. The price differences might surprise you.
- Increase your deductibles. A higher deductible means lower premiums. What’s a deductible and what’s a premium? The deductible is the amount that you have to pay out of pocket before your car insurance covers the rest. So for example, if you have a $500 deductible on a $2,000 accident, then you would have to pay $500 out of your own pocket before your insurance company covers the other $1,500. The premium is basically the price that your insurance company is charging you for the policy plan. However this means that if you ever do actually get into an accident, you will have to pay more than if your deductibles were lower.
- Check and maintain your credit history. Most auto insurance companies take your credit history into account for your pricing. The reasoning behind it? Research actually shows that people with a higher credit score tend to make fewer claims.
- Low mileage discount. If you drive under a certain amount of miles every year, you can tell your insurance company and possibly qualify for a low mileage discount. This is a common discount that many drivers actually qualify for but are not aware of. Discount and mileage amount varies based on insurance company.
- Group discount. If the insurance company you’re with offers more than just auto insurance, consider getting all your insurance through them. Most companies offer a group discount, even if it’s just for more than 1 car. For example, common insurance policies to bundle together are home and car insurance.
- Adjust your coverage. Do you really need all that coverage for that 1990 Toyota Camry? Make sure you are getting the appropriate coverage for the car that you’ve driving. In the 1990 Toyota Camry example, you might skip out on comprehensive coverage for example.
- Compare insurance providers. In a study done in New York, the average driver can save up to $625 by switching car insurances. Insurance prices differ for all individuals based on age, driving history, credit history, car model etc. so it is best to always check with at least 2 or 3 providers before committing to a company.