Many car insurance companies adhere to different sets of guidelines when determining the premium for your policy. The best way to save on car insurance is to be well educated on the topic and discover which aspects of the policy you can take advantage of in order to receive a lower premium. In tough economic times, any place to save a buck or two is definitely important. Small savings can add up to create a more stable economic situation. Different companies offer different ways to save on car insurance; these are some of the things to look for with each individual policy that can save you money in the long run.
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See if the company offers a low mileage discount. Many companies will take into consideration the distance driven by the insured. The lower the mileage, the less of a chance that the driver will be involved in a costly accident; this often translates into a lower premium. In order to take advantage of this, it is wise to drive as little as possible. Many companies gauge the discount in intervals and are incredibly meticulous about mileage. Companies will offer a discount for those who drive less than 10,000 miles a year. In order to fit these requirements, find alternate forms of transportation. Carpool, take the bus, or cut back on unnecessary trips when possible.
Maintain good grades. While this may seem like an unrelated topic, one of the demographics with inflated premiums is younger drivers and students. Insurance companies believe their lack of inexperience in driving to be a high risk and will likely charge them more for insurance. Students who maintain a B or better average may qualify for a good student discount in high school and college. The discount generally requires the student to provide the insurance company with proof of GPA annually.
Take more courses. Better drivers receive better premiums. Taking a defensive driving course can allow drivers to qualify for a discount if they’ve proven themselves to be a safe and defensive driver. Many states offer defensive driving courses and a few other certifications that establish them as safe and educated drivers. Each state differs, but almost every state has a defensive driving course in some form or another which will often translate into savings on car insurance.
Be energy efficient. A few low cost auto insurance companies offer drivers discounts for driving hybrids or other energy efficient vehicles. Some companies that embrace the Green Movement will offer whopping discounts for utilize fuel-efficient cars. If you’re thinking about purchasing a new vehicle, check out some of the different companies and see if they offer discounts for energy efficient vehicles before making your decision. The choice to switch to a more environmentally friendly vehicle can not only be better for Mother Earth, but better for your wallet as well.
Look into getting a multi-policy discount. Insurance companies are businesses that appreciate loyal customers as much as the next. Aside from car insurance, many companies offer insurance for other vehicles as well. Individuals with motorcycles or boats can take advantage of these different areas of insurance and receive a discount from the company on all forms of coverage.
Switch to higher deductibles. The amount of money paid out of the driver’s pockets in the event of a collision, a deductable can decrease premiums. Drivers can save as much as 15-20% on their annual insurance on Comprehensive and Collision premiums by choosing a $500 or $1000 deductible. These advantages are especially useful on newer cars.
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Buy gap insurance. This costs a little more annually, but can cover loan payments on new vehicles. In the event that a driver damages their car beyond repair while still financing the vehicle, gap insurance will cover the loss of a new car that’s worth less than your outstanding balance. This is used to compensate for the instant plunge in value of a vehicle once it’s been purchased.
Don’t let your policy lapse. You could pay 25% more for a new policy when you’re ready to buy one. Some insurers offer a transfer discount for people in these situations. Make sure to renew your policy in plenty of time so you won’t lose your old benefits and be subject to more signup fees.