If you want to drive, auto insurance is a nonnegotiable monthly expense. Whether you drive frequently to commute to work or just occasionally to appointments or on vacation, it is important to have auto insurance to protect your family, your vehicle and your finances. However, as important as car insurance is, there is no reason to overpay for your coverage each month. In order to reduce your car insurance premiums, use these helpful tips.
1. Raise Your Deductible
If your main concern is how much you pay each month in auto insurance payments, then consider raising your deductible. Moving your deductible from a low of $500 up to a high of $2,500 or more, depending on the value of your car, can make a significant difference in your monthly payments. However, to be safe it is also recommended that you set aside enough money to cover the cost of the deductible in the case of an auto accident. Otherwise, you may not be able to get the protection and repairs you need.
2. Reconsider Your Car Choice
Different cars can cost significantly different amounts to insure. A new sports car will be very expensive to cover because typically, more accidents occur for drivers who own that kind of vehicle. On the other end of the spectrum are the safer cars like minivans and sedans, which will cost less to insure. Carefully consider the cost of car insurance payments before you pick a new car.
3. Pay Upfront
Almost all car insurance policies will allow drivers to choose to pay for their entire year-long policy or in monthly installments. Although it can be tempting to split up the payment and defer the bulk of the expenses, if budget allows pay all at once. Typically drivers can save up to 10% by paying for the entire year in advance, or even 6 months at a time.
4. Shop Around
It might seem obvious to shop around among car insurance providers, but it important to fully research each option before committing. Plug in your information online or speak directly to a variety of agents to get an accurate quote. You might be surprised at how a typically cheaper insurance provider charges you more, while a typically more expensive full service provider charges you less.
5. Check Your Credit
Although this isn't often discussed, the truth is that your credit score will have an impact on your monthly car insurance payments. If your credit score is low, work on raising it over time. If your credit score is considerably higher than when you first purchased your insurance policy, call the agent and ask if you can receive a discount. Most companies will be happy to reduce your rate while still keeping you on as a customer.
By implementing these 5 helpful tips you can shop around and find the cheapest possible auto insurance that will still adequately protect your finances, your car, your health and your family.