6 Tips to save money
Do you cringe every month when your auto insurance premium is deducted from your bank account? Auto insurance is important and necessary, but that does not mean you should be paying out the nose for coverage. If your bill has crept a little higher than is comfortable, here are some ways to save.
1. Get quotes from other companies.
If it has been more than two years since you shopped around for auto insurance, it's time to get some new quotes. Insurance companies often change how they assess risk. A company that gave you a high quote a few years ago may offer the most affordable coverage now. It's also possible that you've moved into a new age bracket, gotten married, or experienced some other life change that will earn you a discount from some companies, but not others.
Getting insurance estimates online only takes a few minutes, so it's worth getting quotes from at least three different companies. When comparing the quotes, make sure they all offer the same coverage.
2. Ask about member discounts.
Whether you change insurance companies or stick with the same provider, asking about membership discounts is a great way to save money on auto insurance. Many insurers offer small discounts for members of certain professional organizations. You may also qualify for a discount if you are a veteran or if you work for the government.
3. Check your estimated mileage.
When you purchase car insurance, the company typically asks you to estimate how many miles you drive every year or month. The more you drive, the more they charge. Check to make sure this estimate is accurate on your account. If you now work from home a few days a week, or if you no longer drive across town to the gym, your mileage may have decreased. Update your estimated mileage with the insurance company for a lower rate.
4. Choose a higher deductible.
The deductible is the money you have to pay out of pocket before your insurance will "kick in." The lower your deductible, the more you'll pay for auto insurance.
You can save money on auto insurance by raising your deductible. For instance, if your deductible is currently $250, raising it to $1,000 could save you a substantial amount on monthly premiums. Do, however, make sure you have the money set aside to pay this deductible if you were to get in an accident and need to file a claim.
5. Take a defensive driving course.
Most insurance companies offer a substantial discount if you take a defensive driving course. Call your insurer and ask for a list of courses that qualify; this varies by state. Many of these courses are now offered online, so you can take them from the comfort of your own couch! You'll learn tactics to make you a safer driver, which makes you less risky to insure.
6. Pay the entire premium at once.
When you buy auto insurance, you often have the option to pay for the entire 6- or 12-month period up front, or pay month-to-month. If you can afford to pay the entire premium up-front, you'll often save a few dollars by doing so. You may save even more by setting your policy up to auto-renew when the current period is over.
A car accident can happen at any time, and it's important to have good coverage in case of an accident. Thankfully, there are many ways to save money on auto insurance without giving up coverage. Start with the strategies above, and don't be afraid to ask your insurance company if there are any additional ways you can save.