1. Comparison shop
Each car insurance company charges different prices, but they also have different levels of coverage and customer service. Your best bet is to figure your ideal level of insurance coverage and then obtain quotes from at least three reputable insurers. Keep in mind that you must meet the minimum level of insurance required by your state.
Before the internet became popular this required a person too spend hours making phone calls and answering lots of question to get a few comparable quotes. Now you can get multiple quotes in a few minutes by filling out some short forms.
2. Raise your deductible
When you get in an accident and file a claim for the insurance to pay for damages you must first pay an amount of money; called a deductible, before insurance will cover the rest of the bills. Higher deductibles result in lower monthly payments because the insurance company is offering less coverage.
For example if you raise your deductible from $500 to $1000 on collision and comprehensive coverage your premiums will probably go down by 20%-25%. This is a nice saving is you can afford to pay the deductible.
If you have an inexpensive car don't by collision or comprehensive coverage – If your vehicle is ever totaled in an accident you will receive the cash value of the car minus its salvage value. If you have the ability to replace or repair your care without suffering great financial distress then you should not insure against damage to the care. Insurance is a great way to guard against damages that would impose financial hardship, but it isn't an effective way to guard against small expenses because your premiums don't just support the cost of paying claims, they also support all the administrative, marketing and sales costs an insurance company incurs plus its profit.
3. Buy a boring car
Cars that have expensive repairs and are frequently stolen cost more to insure. Before you buy a car consider the cost of insuring it along with the gas mileage and price tag. Also fast sports cars are more likely to get into accidents than minivans are so naturally it costs more to insure them.
4. Get a low-mileage discount
Most car insurance companies will give you a discount if you drive your car less frequently than the average driver. If you have a short commute to work, carpool or just drive your car for pleasure you should be able to get a discount of 10% or more depending on just how little driving you do. Be aware that if you tell your car insurance company that you have a 5 mile commute to work to get this discount when in reality you have a 30 mile commute to work you will not receive any money from them when it comes time to file a claim.
5. Consider moving to a rural area
Its cheaper to insure a driver who resides in a rural area than one who lives in a city because congested areas have more accidents and rural drivers are more likely to garage their cars which will extend the life of the vehicle by protecting it from the elements. Also car theft rates are lower in the suburbs than the city. The cost difference between insuring a rural driver and an identical city driver is about 10%-20%.
6. Safety feature discounts
Some car insurance companies will discount your insurance if your car has any of the following features: Air bags, car alarms, anti-lock breaks, Anti-theft devices, premium tires and breaks.
7. Look for other discounts
When it comes time to insure your children inquiry about a good student discount. Most of the time insurance companies will reduce the premium on a young driver by 5% if they have a B or better average. Also you can often get a discount on your own insurance by taking drivers safety classes from a recognized institution. Additionally if you have more than one vehicle in your family some insurers will give you a discount if you insure all your vehicles through them.
Buy all your insurance coverage through one company – Medical, home, disability, umbrella, you name it. If you buy more than one type of insurance through a provider they should be inclined to give you a discount for all the business you do with them.
8. Look into group discounts
Discounted car insurance policies are available through professional groups, auto related memberships (like AAA) and large employers.
9. Build a good credit score
Your credit score is one of the factors car insurance companies use to estimate how risky a driver you are. If you are paying your bills on time and keeping your debt under control you will be able to buy car insurance at cheaper rates than drivers who are less credit worthy.
10. Be a good driver
Studies show that drivers who have a history of getting into accidents or receiving tickets for traffic violations cost more to insure. One recent study indicated if you have received one speeding ticket in the last three years the chance of you getting into an at fault accident increased 95%. with two tickets your chance increased 170%. If you have received three speeding ticket you were 254% more likely to have an accident. This makes it pretty clear why insurance companies raise rates on drivers who get into trouble with the law.
11. Don't buy medical coverage if you already have health insurance
Most car insurance companies will offer coverage for medical payments resulting from an accident and personal injury protection (PIP) which replaces any wages lost while recovering from an accident. All your medical expense should already be covered under your health insurance so additional medical insurance through you car insurance is just redundant.
Even if you don't have disability insurance, the personal injury protection offered is not the best way to guard against the financial risk of disability. Your best bet is to buy a separate disability insurance policy and avoid the PIP coverage on your car insurance.
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