Auto insurance protects drivers in the event of accidents, vandalism or theft. It is tied to a car’s market value. The best way to ensure that you pay less for good coverage is, of course to drive safely, observe the rules of the road and maintain good credit. But there are other things consumers looking for lower auto insurance rates can do to tip the scales in their favor.
Get multiple rate quotes
J. Robert Hunter of the Consumer Federation of America tells Edmunds.com that “You can easily wind up paying double from one company to the next,” so don’t be afraid to shop around. Further research through a site such as the National Association of Insurance can confirm that some of the lower-priced insurance policies actually offer some of the best customer service.
Don’t jump at full coverage
Instead of carrying full- or low deductible-coverage for such things as comprehensive and collision damage, going with higher deductibles or dropping comprehensive and collision altogether can save a great deal of money. Hunter says that going from a $250 to $1,000 deductible can save from 25 to 40 percent on total premium cost. And if the car is older, dropping comprehensive and collision coverage is advisable.
If you aren’t sure, Hunter suggests adding the deductibles and multiplying the result by 10. If the vehicle is currently worth less than what you come up with, the coverage is inadvisable. The average insurance carrier only files a claim once every 11 years, so dropping comprehensive and collision on less valuable vehicles isn’t much of a gamble.
Reaping the discounts
If you drive infrequently and use the car for pleasure purposes only (rather than for work), there are discounts to be had. Not only that, but membership in various professional organizations may entitle you to additional savings. Safety and anti-theft devices will also translate into lower premiums. Being a good student or a senior citizen doesn’t hurt, either.
Pay in full and don’t allow coverage to lapse
Paying your insurance premium in installments can be convenient, but there will inevitably be an administrative fee of $10 to $15 per installment attached. If you are able, pay the full premium up front and save. And keep paying for as long as you plan to drive. Many insurers will charge exorbitant rates if there is even a brief coverage lapse.
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