Most motorists buy auto insurance not because it is legally required but it gives tremendous peace of mind. It would be a shame to weaken valuable protection a policy provides in order to save some money. The good news is that you can achieve decent savings while keeping or even increasing coverage. Some of the various solutions discussed below may help you.
As a general rule, underwriters aren’t worried about increasing coverage. Large claims are only small portion of total claims expenditure. Actually, smaller ones are the main worry because they add up when you include administration costs and considering the number of them. That is why the rates charged for higher levels are much lower than the essential part simply because minimum state required auto liability coverage is exhausted often and easily. However, there is a very little chance of a $300,000 limit being ever used.
How to Lower Auto Insurance Premium
Therefore, you should seek to get the maximum coverage you can and find other ways of keeping the cost manageable. Luckily, there are a few things you can do to achieve this goal as discussed below.
- Talk to Them
They have to explain why you are paying a high premium. They will let you know what seems to be a problem and that would be a good starting point to address the issues. It could be that your partner’s bad record inflating prices. If he/she has her own auto and policy they have to take it into account that he/she will only drive yours on occasion. In that case, you may be able to even exclude him/her if you choose to do so.
- Check Credit Score
Lately, credit score is one of the most influential factors that lead to premium increases. Many people don’t realize this because they still think that companies only look at driving record to determine rates. If credit history is the problem, you need to get quotes from insurers who don’t take credit into account as much as others.
- Check Mileage
Some of them use proprietary methods to calculate yearly mileage. There is a high chance they have gotten it wrong. For example, if your work is 40 miles away from home they will assume that you will travel 40 x 2 x 5 x 52 = 20800 miles annually just for commute. If you are taking public transport to work this figure would be 0 and that should reduce premium a lot. There are ways of showing the actual mileage you are doing like giving odometer readings. If you don’t use it for commute you can choose pleasure only that will cut costs considerably.
- Consider Limiting Drivers
Standard policies assume that you may let others use the automobile. If that is not the case, you may buy a named drivers only plan. That would mean that only listed drivers can operate it. But it could be a worthwhile restriction if it can reduce costs. This approach can work well for people with sports cars or SUVs. By the way, you will probably need to disclose every person with license in your house.
- Find the Cheapest Vehicle Insurers
Every carrier has different underwriting criteria and discounts that the chance of two companies offering similar rates is very slim. In fact, the price difference between the cheapest and most expensive can be several folds. The above link lists the most competitive ones near you. Start with them and get a few more quotes to unearth the lowest priced provider for you. This alone can substantially bring down automobile insurance rates.
- Seek Out Further Discounts
Every company determines the type and amount of discounts they will offer independently. There are so many of them that you will almost certainly qualify for one or two more if you look into it. Also, here are some of the other lesser-known ways of reducing car insurance.
- Consider Changing the Policyholder
This can only work for people who are in committed relationship and have one vehicle. For example, ladies generally get cheaper rates. So, if the family car is insured on the male partner’s name you may consider having it the other way around. You may have to deal with title issues in some states since the owner and the policyholder may have to be the same. But it may be worthwhile to go through the trouble if you can save money. Usually, each partner uses the shared vehicle equally and this wouldn’t create a concern.
- Consider Changing the Car
If nothing seems to work and you are struggling to afford auto insurance you may have too look at what you drive. Generally larger vehicles with bigger engines cost more. Replacing such a car with a more modest one can save you a lot of money.
- Consider Telematics
These are the types of policies that base rates on the driving habits. They may need to fit a little telematics device that transmits information back to the carrier. That is why you don’t go for them if you are worried about driving habits and have privacy concerns.
- Talk to an Experienced and Independent Broker
If nothing works, you need to find someone who may know better solutions. This comes with experience and that is why you need to seek out a seasoned broker. Also, tied agents who only work for one company may not be able to help you much unless you talk to a few of them.
The bottom line is that you shouldn’t give up easily and explore different avenues. There are so many ways of saving money on car insurance that you have a pretty good chance of finding a lower premium while keeping or improving coverage. Why not start with getting a few quotes right here from our panel of reliable providers. One of them may be able to offer a cheap quote that can make it worthwhile for you to switch.