Car insurance is an important thing to have for many reasons, and in most states it is even a legal requirement if you own and drive a vehicle. The downside of having car insurance is that it can be very expensive, which can be tough for frugal people to swallow. With that in mind, here are a few ideas to help you lower your car insurance premiums:
Drive a Beater
Not driving the ?latest and greatest? new car can help save you money not only by avoiding expensive car payments, but it can also save you from having to pay more for car insurance too. Insurance premiums are higher for newer and more expensive models, which is something a lot of people overlook when considering what vehicle to buy and how long to keep it. Generally speaking, the longer you keep the car the less you?ll spend on insurance premiums each year.
Don?t Pay for Coverage You Don?t Need
Every year I get a call from my insurance company to set up a time to review my current coverage levels vs. my actual needs. While this may seem like a waste of time, especially if you?re busy, it is important to do this at least annually. At this meeting you should review what coverages you are currently paying for and if it?s a good time to drop excess coverage you may not need. Consider switching from full-coverage on your beater car to a cheaper alternative that will save you a lot of money, or you could raise your deductible to shave a few dollars off your premium too.
Ask for Discounts
Most insurance companies offer several discounts, including multi-car and multi-policy discounts if you have more than vehicle or policy (think homeowner?s or renter?s insurance) with the same company.
Another discount to consider is a safe driver discount. If you?ve had to take a safe driving course for your job, take your completion certificate in to your insurance agent. These types of courses can save you between 5-15% annually on your insurance policy. But, keep in mind that safe driver course discounts only last for around 3 years.
There are lots of other discounts that you may qualify for, so it?s important to sit down and review your coverage and what discounts are available to you. You might be surprised by what discounts are available and which ones you can qualify for.
Switch to Annual (or Semi-Annual) Payments
When you meet with your insurance agent ask if there is a discount factor applied for paying in a large lump-sum vs. paying your insurance monthly. Many insurance companies prefer you pay your premium once or twice a year instead of monthly and so they?ll offer a discount if you choose to pay a large portion of it at once.
Not every savings method will work at every insurance company because they all offer different discounts and incentives. But it never hurts to ask for discounts or a cheaper rate. Insurance companies offer lots of different ways to save and together they can add up to a big difference on your annual premium.
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