1. Increase your deductible – Your deductible is the amount you have to pay when you make a claim before your insurance company pays you. The advantage of increasing your deductible is that your yearly insurance costs go down. The disadvantage is that, if you do make a claim, you’ll have to pay more. But raise your deductible, save on your yearly insurance costs for a few years, and you’ll end up saving more money in the long-term on insurance costs than you’d have to spend extra as part of your raised deductible.
2. Decrease your collision and comprehensive insurance on older, cheaper cars – If your car is old and relatively cheap, then it usually isn’t worth paying for these types of insurance. You’ll just end up losing money by paying more in insurance costs than your car’s true worth.
To find out the true worth of your car, you can get in touch with an auto dealer, or do some research on your own through automotive magazines, guides, and websites.
3. Buy and drive a less “flashy†and “high maintenance†vehicle – The cost of insurance is influenced significantly by the kind of car you drive. Some cars are more prone to being stolen than others. Other vehicles cost a lot more to repair and service. These kinds of vehicles – those with a high risk of being stolen or with very expensive maintenance costs – typically have much higher insurance costs as well.
4. Consider the cost of your car insurance when you move to a new area – The cost of insurance varies from place to place – depending on factors like population density, crime rates (auto theft in particular), etc. Keep this in mind – you might want to think twice about moving to an area with significantly higher auto insurance costs. Or, at least find a more affordable auto insurance provider.
5. Make sure your insurance company has the proper model, rating, and use of your vehicle in its records – Manufacturers often have similar model names for their vehicles. But insurance rates can vary considerably depending on the model of your car, so make sure your insurance company isn’t overcharging you because its records show a different vehicle model than you actually have.
6. Take every advantage you can of a distance discount or low mileage rating – You can find insurance companies that give discounts to drivers who drive less than a certain number of miles each year, or only drive certain regular distances (e.g. directly to and from their place of work). These discounts can help you save on your auto insurance rates.
7. Have your broker look for and compare other insurance company discounts - For example, many insurance companies offer discounts to drivers who got more than one different insurance policy from them. So your insurance company may give you a discount if you have both your homeowners and auto insurance policies with them, plus any additional insurance policies. This is called a multi-policy discount.
There are other kinds of discounts, such as:
- Multiple-vehicle discounts
- Anti-theft device discounts
- Retiree discounts
- Drivers’ education discounts
- Alcohol abstainers’ discounts
- Age discounts (e.g. insurance rates tend to decrease for those over 25)
Get your broker to find all discounts that apply to you, and take advantage of every single one of them. And if you’re not eligible for some of these discounts now, you can take steps to become eligible for them – e.g. you can have an anti-theft device installed in your car to both protect it and get that anti-theft discount from your insurance company as well. Or take the necessary drivers’ education courses to get a drivers’ education discount.
8. Maintain a good driving record – This one is a no-brainer: The more spotless your driving record, the lower your insurance rates will be. Insurance coverage rates have a nasty habit of going up dramatically for even minor traffic infractions. So keep your driving record as close to spotless as you can – take additional driving courses if necessary.
9. Maintain your vehicle - The better condition your car is in, the less likely you are to be involved in an accident (an accident that could really hurt your driving record). Needless to say, good car maintenance will also ensure your personal safety on the road.
10. Consider getting rid of insurance coverage you don’t really need – for example, if you have one or more vehicles you rarely (if ever) use, you may wish to get rid of all unnecessary coverage for them.
Bonus Tip:
11. Have your credit score and history in order before applying for any auto loan - Your credit score will be checked by your auto loan provider, and the worse it is, the higher your insurance rates will be. And if you have a bad credit score, an auto loan provider may refuse to give you a car loan in the first place. So check your credit reports to make sure there's nothing wrong. If there is, have it corrected. You can read more about how to improve your credit rating in another one of my articles: Just click here. My name's Vlad Vassilovski. I'm a guy in Toronto, Canada, who's real interested in cars and all financially related topics. I'd like to become one of those "auto experts" quoted in all the automotive publications, so I've started a blog - CarInfoCentral.Com - where I write about topics like: Auto insurance, auto loans, buying a car, car shopping online, car leases, and more.
If you'd like to repost one of my articles online, you're welcome to do so. The only thing I ask for is that you clearly state that I'm the author, include a link back to my blog (CarInfoCentral.Com), and leave any links in my articles the way they are. Otherwise, you're welcome to use my information.
And if you'd like to contact me, my email address is Vlad@carinfocentral.com
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