Every driver is unique and vehicle insurance policy requirements are as unique as people. While some don’t mind paying a few dollars extra for a deluxe coverage a few others would rather look for the most affordable auto insurance. There is no right or wrong when it comes to making your own choices. But you need to make sure your decision meets your needs.
When you have good income it may not be crucial to find the most affordable auto insurance policies. However, loss of job, reduced earnings or sending children to private school can reduce your spendable income considerably that it becomes priority to reduce insurance costs. These steps can be taken by anyone who likes to manage a tight budget by controlling some expenses.
1. The Most Affordable Auto Insurance Coverage
If you are really looking to know what is the cheapest car insurance coverage you must buy it is the liability only cover. However, the most popular US auto insurance is full coverage with more than 72% of motorists buying it. That is why we suggest that you should try to find cheap full coverage car insurance using the tips below.
Before you look to find the most affordable car insurance you may want to think about what level of coverage you will be comfortable with. As a general rule, the more is the better. But you will have to find a good balance between costs and coverage. One thing to keep in mind is that you don’t want to make matters worse by dropping essential coverage as discussed above.
Drop coverage when you are able to handle insurable losses on your own. For example, if your automobile is worth about $4,000 and you are confident you can handle this amount of loss if it is totalled you can drop it. This may save you some money now. If your driving record and claim history is good your chances of having an accident would be low as well. Perhaps your old car will die before it suffers an insured loss. Then, you will need the money to buy another vehicle and savings on insurance can help you there.
2. Get Discounts for the Most Affordable Car Insurance
By now, you have a good idea about what type of risk you are to auto insurers. If you are a low risk you will be offered good discounts by most companies. These discounts can easily halve your costs. Some of them are good driver, no claim, safe zip code, home owner, safe car and low mileage discounts. You can read more about possible auto insurance savings and see if you could qualify for any of them.
3. Manage Your Credit Score
When you know you may run into money problems, be active and manage your spending. If you let some of the bills sit unpaid you will see a drop on your credit score. Most states allow credit score to be used in premium calculations and most companies use them. First, try to cut some of the expenses and create some cash.
For example, it may have been a good idea to own a timeshare when things are good but it would not be any more when things turn for the worst and you are trying to save your home. See if you can sell and make some cash for the rainy days. This would also get rid of the maintenance fees. Look at your own circumstances and see if there is any adjustment you can make. Another one is to let that basement out. Also, be prepared for the worst if you see it coming.
If you feel that your credit score is going to go down try to find the most affordable auto insurance company now and take a 12 month policy. This way you will be ahead of the game and fix your rates for the next 12 months at least. If you are lucky your current insurer may not look at your credit score again at the next renewal since they checked it recently already.
4. Choose Your Cars Well
You should look at the overall cost of auto ownership along with cost of insuring vehicles. For example, cars with high engine power are generally expensive to run and insure. If you are worried about filling the petrol tank every so often, maybe it is time to be more sensible about the cars you own. Not only petrol costs but also repairs on such automobiles can be really expensive. They have expensive parts that you would have to pay a lot of money when you have to change them.
Buying a sensible family car instead of your sporty one can save you considerable amount of money on petrol, repairs and insurance. Insuring a reliable family automobile is generally cheaper in comparison with SUVs, trucks and sport cars. Furthermore, it may be time to trim your inventory. One or two reliable cars can be enough for a family that you don’t need to keep that old car anymore when you have a replacement already.
5. Have a Look at Driving History and Claims Record
Your driving history will affect the premium as much as 40%. If you want the most affordable auto insurance rates you need to avoid getting speeding tickets and other traffic violations. If you are over 55 you can save around 10% by taking defensive driving courses. In some states including New York you can take these courses and get discounts regardless of your age.
Your claims record is an indication of how good a driver you are as well. Also, it is important that you have an honest assessment of your driving and ability to stay away from accidents. This will be important when you are choosing coverage and deductibles. If you are not confident that you or your listed drivers can stay accident free you should have sufficient coverage for possible losses and keep deductibles low.
Otherwise, you will run into more troubles while you are trying to save money by choosing high deductibles and low coverage. This brings us to the next consideration.
6. Consider Your Financial Reserves
If you have no or very little cash reserves, it becomes extra important that you choose good level of coverage. Increasing your coverage to a sufficient level will not cost you awful a lot more. But you will have a serious problem if you cannot get your automobile repaired following an accident or find the money to buy another one (if it is totaled).
Again, you would probably save money if you increase your deductible to $1,000 from $250. However, you would run into troubles if you cannot find $1,000 to cover the deductible when you have an accident.
7. Higher Deductibles
We have already covered this above. If you see the chances of having an accident or face auto theft low and you have sufficient financial reserves you may consider increasing deductibles. You should get two quotes, one with low and the other with high deductibles and see if you are saving enough for taking more risk yourself.
8. Look for the Most Affordable Car Insurance Quotes
Never settle for the first quote you got. True that it may be the lowest and the best coverage indeed. However, you need to test this by getting alternative quotations. You probably know the level of coverage you need by now. Offer the same information and coverage levels to all of them and compare the quotes you received.
Once you have a short list of agreeable quotes, you can go to your state insurance department website and check how many complaints each company received and how they dealt complaints. Remember to look at the number of complaint in the light of company size. A company may have received fewer complaints but it may be a fairly small company in the market anyway.
Some states may offer complaint ratio of companies. This figure is worked out based on the number of complaints and the company’s share of the automobile insurance market in the state. The national median is 1.0 but even good companies may fail to score as good. You don’t want to be messed around by your insurer when you have a claim especially if a rejection of a claim will affect your finances terribly.
9. Use Independent Auto Insurance Brokers
If you have already identified a particular and highly competitive company and like to buy through an agent instead of online you may be alright with a tied agent. Otherwise, you should look for an independent broker. They can talk to several companies and choose the best deal for you. There is no harm in telling the broker that you have already got some quotes online and he/she needs to beat a certain figure if he/she wants the business.
Remember you are looking for the best and this applies to brokers as well. If they are not willing to work for your business perhaps they don’t deserve the commission. Brokers can be real handy if you are struggling to find the most affordable car insurance rates. Good ones would know where to look for each client.
10. Check for State Low Cost Auto Insurance Programs
If you are not having any luck with your search you can check to see if your state is offering low cost vehicle insurance for low income drivers. California, New Jersey and Hawaii have such programs and some other states may have different arrangements in place. You can find out from state insurance department website. You will find the website details here under your state. Generally they are available to low income families and qualification requirements may apply. If you can qualify you can get a really good deal for a basic policy.