Everyone knows that auto insurance is something no driver should ever be without, and can protect you immensely if you get in an accident. Even though you know you have to have auto insurance, the bill can sometimes seem like a big financial burden. Luckily, there are several things you can do to lower your premiums. Here are five ways to save money on auto insurance:
Bundle Your Policies
You can often save money by bundling one insurance policy, like homeowners or renters insurance, with the same company as your auto insurance. This is because insurance companies like to reward their customers' loyalty with discounts for having multiple accounts. This can also make your life more convenient since you can probably make payments for both policies at the same time, and work with only one insurance agent instead of dealing with multiple agents.
Opt For a Higher Deductible
Opting for a higher deductible might sound counter-intuitive as a way to save money since in the case of an accident you'll have to pay more money out of pocket. But as long as you have enough in savings to easily cover the deductible, and are not an accident-prone driver, this can be a great money saver because the higher your deductible, the lower your payments.
Just be sure not to choose a deductible that is higher than you can truly afford, since this is too risky and will cause serious financial hardship if you do get in an accident. Ideally, you will drive safely, avoid accidents, and never have to pay the deductible at all.
Many car insurance companies offer discounts to drivers who drive fewer than a certain amount of miles per year. The amount varies from company to company, but according to the DMV it's typically between 7500 and 15,000 miles a year. It's worth a phone call to your insurance company to see if they offer this discount if you are pretty sure you drive less than an average driver.
For example, if you live close to work or work from home, carpool to work, or often ride your bike or take the bus instead of driving, you are probably not racking up as many miles as other drivers. Car insurance companies love drivers who drive less than average, since the less you drive the less chance there is that you'll have an accident.
Ask About Special Discounts
Since special discounts vary by state and individual insurance companies, you should contact your insurance company directly for this. Simply ask what discounts they have available and see if any of them apply to you.
For example, some auto insurance companies offer discounts to those who've taken defensive driving classes, retirees, college students with high GPA's, drivers of cars with certain safety features, and more. These discounts are not usually automatic, so it's definitely worth taking five minutes to make a phone call in order to see which discounts you might be able to take advantage of.
Consider Reducing Your Coverage
Full coverage makes sense in a lot of cases, but if you are driving an older vehicle that isn't worth a lot of money you really may not need it. Determine the amount you are paying for collision coverage each year and compare it to the amount it would cost to replace your car if it was totaled. The newer and more expensive your car, the more important it is to have collision coverage. If you could easily replace your car without insurance, on the other hand, you might want to opt for just liability insurance, which is much cheaper.
Check out sites like http://www.collinginsurance.com/ for more info.