How to save money on Auto Insurance

With so many people trying to cut costs on their bills, car insurance companies have spent a lot of time advertising low rates. While shopping for cheap car insurance online can certainly lead to a more inexpensive policy, it is hardly the only way to save money on car insurance. Many people do not fully understand how insurance works or precisely what they are paying for; by educating yourself on a few general principles of insurance, you can save money on your premiums and be sure you are getting the coverage you need. There are several ways you can save money on car insurance:

Drive safely

Car insurance companies want customers who will never file claims; they are worth more to the company as the insurer can gather many years of premiums without ever having to pay for damage to the vehicle. Because of this, car insurance companies will reward safe drivers with low premiums in exchange for years of accident-free driving. The more years you are insured without any accidents or traffic citations, the more discounts you should be eligible for. Talk with your insurance company about any discounts you can take advantage of.

Choose a safe, reliable vehicle

Just as insurance companies measure risk in drivers, they also rate vehicles according to risk and expense to repair. Some vehicles, such as luxury vehicles and sports cars, are more expensive to insure than others. Traditionally minivans are the lowest cost to insure, along with mid-size sedans and some SUVs. You can ask your agent or customer service representative if the company has any guidelines regarding vehicle insurance prices; it can definitely make a difference when selecting a new vehicle.

Reduce your mileage

Statistically, people who drive a lot have more opportunity to get into accidents. Insurance companies take your daily mileage into account when computing your premiums. If you have recently made a change in how much you drive due to unemployment, a closer job, or taking advantage of alternate transportation opportunities, call your insurance company and tell them. Advise your agent that since you are driving fewer miles you deserve a lower rate; very often you can negotiate the price of your insurance down just by asking. You can also inquire about your company?s ?pay as you go? policies, which are special insurance policies designed to track your mileage and driving habits and charge you based upon those metrics.

Change your coverage

You may be paying for more coverage than you really need. If your vehicle is very old, it may not be worthwhile to carry collision coverage anymore: The vehicle may be worth almost as much as your deductible. You may also decide you don?t need extra coverages like rental reimbursement or towing, depending on your needs. You may also save some money by increasing the amount of your deductibles. Higher deductibles cause reduced premiums, since they represent money your insurance company will not have to pay in the event of a claim. Bear in mind before making any changes to your policy that if you were to get into an accident your reduced coverage may not take care of everything. It?s important to understand what your coverage does before dropping it.

Bundle your coverage

Insurance companies will offer discounts to customers who carry multiple types of policies with the company. If you have a home, boat, motorcycle, or RV, consider insuring it through the same company as handles your car insurance. Even if you don?t own a home you can still purchase renter?s insurance, which protects your personal property in the event of theft or disaster regardless of where you are staying. Renters insurance is usually rather affordable, and may be enough to qualify you for a discount with your insurance company.

Compare Car Insurance Quotes

Even after you make changes to your policy or your lifestyle, your insurance may still be too high. This is the time to begin shopping for quotes online for new car insurance companies. Once you fill out a form, you will be given a preliminary quote immediately based on some of your information. A representative from the insurance company will call you shortly afterwards to discuss a more accurate quote, once he or she has had time to review your driving history and claims record. Once you obtain this quote, you can decide if you want to switch insurance companies, or if you would rather try to convince your current company to offer you a discount. Often, companies will make a tremendous effort to save loyal customers. If you contact your agent or customer service representative and explain that you are paying too much for insurance and have received a lower quote from another company, you may be offered a discount to match the competitor?s price.

Whatever method you choose, you can save money on car insurance by improving your habits, trimming coverage, and shopping for quotes online. Once you understand how insurance companies determine your rates, you can make an informed decision about your policy that will save you money without sacrificing the quality of your coverage.

Related posts:

1. How to Save Money on Home Insurance
2. How to Save Money on Life Insurance
3. How to save money on car insurance for young drivers?
4. How to save money on Health Insurance
5. How to save money on Car Insurance

Source: http://www.howtosavemoney.com/how-to-save-money-on-auto-insurance/

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