When it comes to lowering your car insurance premiums, there are many things you can do. Here are some tips:
1. Improve your credit score
Insurance companies have found that drivers with better credit scores file fewer claims and cost them less money to insure their vehicles.
So make sure to pay bills on time, pay off your debts and keep your credit record clean. This will save you a bundle in the long run and help you get lower car insurance rates in the future.
1. Improve Your Credit Score
Your credit score plays an important role in deciding whether or not you will get approved for loans, credit cards and mortgages. It is also used to determine how much you will pay for car insurance, depending on your state’s regulations.
The major credit bureaus, Experian, Equifax and TransUnion, calculate your credit score by weighing different pieces of information in your credit report. If you have problems with your score, you may be able to lower it by improving certain aspects of your credit history.
In many states, a low credit score can raise your insurance rates or even deny you coverage altogether. If you suspect your credit score is negatively affecting your insurance, check your credit report and ask the insurer to explain how it was affected.
2. Reduce Unnecessary Coverage
One of the best ways to save money on car insurance is to reduce unnecessary coverage. Some policies come preloaded with bells and whistles you may not need, like roadside assistance or car rental coverage.
Another is to raise your deductible, which can be a relatively quick and easy way to lower your monthly premium.
Lastly, you should also look at your current policy to see if it includes any discounts that could save you a few bucks. From good student discounts to military or employer-related discounts, there are plenty of opportunities for you to earn some extra cash on your insurance payments.
It is important to note that lowering your insurance bill can be a challenge, but with some patience and effort you should be able to reap the benefits.
3. Increase Your Deductible
Increasing your deductible is one of the best ways to save money on car insurance. Depending on your car, your driving history and other factors, raising your deductible may cut costs by 15% to 40% or more.
If you choose a higher deductible, be sure you have a good emergency savings fund in place to cover any unexpected repairs. Otherwise, you could end up with a bill that you can’t afford.
It’s also a good idea to price out the savings at different deductible levels. You’ll want to know how long it would take you to make up the difference in your premiums if you had to file a claim.
4. Buy a Safe Car
Safety is a key factor for any car buyer. Today, more cars are available with advanced safety features than ever before.
Buying a safe vehicle is one of the best ways to lower your car insurance premiums. You should shop for a model that offers superior crash-test results and has safety features that prevent injury to occupants in the event of a collision.
You should also check whether the model you’re interested in has a high safety score and good theft-loss records. Those features can significantly reduce your insurance costs.
5. Shop Around
Whether you need to insure your first car or renew your current policy, shopping around and getting quotes from multiple insurance companies is an effective way to lower your premiums.
The best way to shop around is by requesting quotes from at least three insurers. Using a tool like the one at the Insurance Information Institute can help you estimate the costs of different policies and coverages from multiple providers in just a few minutes.
Besides price, factors that can affect car insurance premiums include your credit score, vehicle type and driving behavior. Changing your vehicle type can make a big difference in your insurance rates.
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