10 Secrets to Saving Money on Auto Insurance

10 Secrets to Saving Money on Auto Insurance

Shop Multiple Companies – The difference between the highest and the lowest priced insurance quote can be hundreds of dollars. It pays to shop as many companies as practical when buying insurance. How can you do this without taking a month off work? First, deal with an independent agent rather than a single company agent. It goes without saying that a single company agent is going to attempt to convince you that his single company is the best deal for you – even if the price is way-off. Almost all independent agents have specialized software that can instantly rate your policy with dozens of insurance companies. This is how you find that low rate.

Don’t Premium Finance – Pay for your insurance up-front. Premium financing can add more than 20% to the cost of your auto insurance!

Always buy motor club benefits with your auto insurance – Ask your agent for towing and rental benefits. For less than you would pay for towing and emergency road service alone from a national motor club, you can generally add a heftier towing benefit plus auto rental while your car is being repaired after an accident to your insurance policy. The secret here is to ASK for a towing and rental contract. Many agents will not offer if not asked.

Increase your deductibles – Deductibles are a time-honored way to reduce the cost of auto insurance by reducing the insurance companies risk on small losses. Take the largest deductible you can afford on coverage for your car and talk to your agent about taking a deductible on your no-fault coverage – especially if you have a major medical policy in force that doesn’t coordinate with no-fault benefits.

Make monthly payments on time – If you must premium finance your auto insurance, make certain you make your monthly payments on time. A late payment will generally cost you at least $20. If you were late on all 8 payments of a typical premium finance contract, you could add as much as $160 to your insurance costs just by paying your monthly payments a little late. If you fail to make a payment altogether, you may be assessed even more charges for short-term cancellation and reinstatement charges.

Don’t let your insurance lapse – Many insurance companies will refuse to accept you or increase your rates if you have a history of driving without insurance. Keep insurance continually in force!

Understand limits of coverage – Talk to your agent about adequate coverage limits. If you have a net worth of $15,000 do you really need $300,000 in liability protection? If you already have a great major medical policy, do you really need excess medical payments? Carefully evaluate Uninsured-Underinsured Motorists to see what, if any, limits of this coverage you require. UM pays for medical bills and non-compensatory damages such as pain and suffering and loss of income if you or others in your car are injured by an uninsured motorists. If you don’t want it, don’t pay for it. But talk to your agent before you decide.

Ask about credits – Many insurance companies offer good-student, driver training and multi-car discounts. When possible, put all your vehicles on one policy and ask you agent about other discounts.

Put youthful operators on their own policy with their own car – If you carry a high-limits policy, it may make sense for your teenager to carry his own policy for his own car – at lower limits.

Check your credit rating – For a while now, many insurance companies have been using credit rating as a rating/acceptance factor. Contact the credit agencies and obtain a copy of your credit report. Check the report for accuracy and report any errors immediately with the credit agency. Then make certain you protect your credit – and your low auto insurance rates – by taking care of your financial obligations as agreed.