It pays to shop around. Call both independent and captive agents. Independent agents represent multiple insurance companies and captive agents represent a single company. Contacting both kinds of insurance agents gives a bigger choice of insurance companies and the best chance of getting the lowest possible rate.
Get the Discounts
Discounts are available on car insurance for people who have their home, condo or renter’s insurance through the same company. Some companies offer a discount just for owning a home or a condo. There are also discounts for being claims free, for renewing a policy, for being a AAA member, for taking driver safety courses, for being a single parent with custody of a child, for purchasing the policy 7+ days in advance of the effective date and for paying the policy premium in full.
Increase the Collision Deductible
The collision deductible has a much greater effect on the premium than the comprehensive deductible. For example, someone with a comprehensive and collision deductible of $250 would save a significant amount of money by raising their collision deductible to $500. Keep the collision deductible as high as possible and shell out less money to the insurance company.
For older cars that don’t have a lien, money can be saved by foregoing the collision coverage altogether. Keep the comprehensive and purchase UMPD (Uninsured Motorist Property Damage). UMPD is much less expensive than collision. Collision coverage only covers the actual cash value of the vehicle, which isn’t much for older cars. The car will still be covered for everything collision covers except at fault accidents.
Avoid Filing Claims
Claims that are filed against insurance companies affect the premiums even if nothing is paid. Insurance should be reserved for big, unmanageable expenses. For example, small claims that could easily be handled by the insured, such as towing, should not be filed. If the cost to repair a vehicle is less than or equal to the deductible, filing a claim would not be wise. The fewer the claims, the lower the rate.
Save Police Reports for Not at Fault Accidents
Insurance companies are highly automated these days and a great deal of the underwriting is done by computers. When reports are run, the computer underwriter automatically assumes all accidents are chargeable. It is up to the insured to show proof of not at fault accidents. Police reports should be saved for three years. This information applies to most, but not all states.
Get a Better Payment Plan
The installment fees that insurance companies charge can really add up. For example, a twelve pay, direct bill plan with a fee of $11 per installment adds up to $132.00 in extra charges! These fees can be avoided by paying the policy premium in full or by enrolling in an automatic bank draft payment plan. When insurance companies do not have to send out paper statements every month, it saves them money. This, in turn, saves money for the policy holder.
Choose the Right Policy Term
People with clean driving records should choose a twelve month policy instead of a six month policy. This locks in the rate for a longer period of time. Plus, if the insured gets a speeding ticket during the policy term it won’t affect the rate until the next renewal. A six month policy is good for people with tickets or accidents coming off their records within six to eleven months because driving record changes don’t affect the rate until the next renewal. For people who can pay in full for a six month policy but not for a twelve month policy, getting a six month policy will eliminate installment fees and give an additional discount.
It’s so easy to eliminate unnecessary costs on car insurance. Take advantage of the competition between insurance companies and get a better rate. People should check with their agent to make sure they’re getting all the discounts that are available. Excessive fees can be avoided by choosing a better payment plan. Rates can be kept lower by not filing claims whenever possible. Changing the policy term can sometimes save money. People who follow the steps outlined above can say hello to lower car insurance premiums!