Getting the best rate on car insurance is important for keeping more money in your pocket. While insurance is necessary for responsible driving, there are several easy ways you can save on your premiums. The following are essential tips for saving money on auto insurance.
Shop Around
The first key to savings is to compare rates across various insurance companies. Premiums vary widely between insurers due to factors like a company’s risk assessment, coverage offerings, and discounts. Getting quotes from at least three providers ensures you find personalized coverage plans. You can conveniently shop rates online or work with an independent insurance broker to simplify the process.
Raise Your Deductibles
Consider raising your car insurance deductible. This is one of the easiest ways to bring the premium down. However, if paying a high deductible would be a financial hardship, sticking with a lower one and slightly higher premium could be the wise option to avoid money stress after an incident. Ultimately, it’s about weighing premium savings vs. the ability to cover immediate out-of-pocket costs.
Enroll in Usage-Based Programs
Many insurers now offer usage-based programs using telematics technology. These programs track policyholder driving habits like mileage, acceleration, braking, turning, and phone usage. Safe driving is rewarded through discounted premiums and cash back. Usage-based programs provide a significant opportunity to save money for attentive, low-mileage drivers. Insurers look at the data collected and provide personalized premiums and feedback to reward safe driving habits.
For instance, drivers who stay under a set mileage threshold each month or exhibit low rates of aggressive acceleration and braking during trips may receive discounted rates. These usage-based programs empower drivers to control costs by modifying driving patterns. Not only do good drivers pay less for coverage, but the awareness and incentives provided by these programs also improve overall road safety.
Maintain Good Credit
Your credit score can greatly impact your insurance rate. Insurers analyze credit when underwriting policies because research shows a correlation between creditworthiness and claims risk. Drivers with poor credit often see the most savings from improving their scores. However, keep in mind it takes diligence and time to boost your score through steps like paying bills on time and limiting hard credit inquiries.
Take Advantage of Discounts
There are many common auto insurance discounts to explore so you can maximize your savings. Bundle your home and auto policies with the same provider to save up to 15%. You can also often get a lower rate if you insure multiple cars on the same policy, and make sure to ask providers what other discounts are available. For example, savings may apply for being a good student, completing a defensive driver class, having anti-theft devices, choosing lower coverage limits, and more.
Being a smart and savvy shopper is key to locking in the lowest car insurance rate. Comparing providers, minimizing risk factors, maintaining good credit, exploring discount opportunities, and enrolling in mileage-based programs can potentially help you save hundreds per year. Putting in the effort makes finding an affordable rate attainable.