Nine Ways to Lower Your Auto Insurance Costs.
One of the best ways to keep your auto insurance costsdown is to have a good driving record.Listed below are other things you can do to lower yourinsurance costs.
1. SHOP AROUND
Prices vary from company to company, so it pays to shop around. Get at least three price quotes.You can call companies directly or access information on the Internet. Your state insurancedepartment may also provide comparisons of prices charged by major insurers. (State insurancedepartment phone numbers and Web sites can be found on the back cover.)You buy insurance to protect you financially and provide peace of mind. It’s important to pick acompany that is financially stable. Check the financial health of insurance companies with ratingcompanies such as A.M. Best ( www.ambest.com) and Standard & Poor’s(www.standardandpoors.com/ratings) and consult consumer magazines.Get quotes from different types of insurance companies. Some sell through their own agents.These agencies have the same name as the insurance company. Some sell through independentagents who offer policies from several insurance companies. Others do not use agents. They selldirectly to consumers over the phone or via the Internet.Don’t shop by price alone. Ask friends and relatives for their recommendations. Contact your stateinsurance department to find out whether they provide information on consumer complaints bycompany. Pick an agent or company representative that takes the time to answer your questions.You can use the checklist on the back of this brochure to help you compare quotes from insurers.
2. BEFORE YOU BUY A CAR, COMPARE INSURANCE COSTS
Before you buy a new or used car, check into insurance costs. Car insurance premiums arebased in part on the car’s price, the cost to repair it, its overall safety record and the likelihood oftheft. Many insurers offer discounts for features that reduce the risk of injuries or theft. To helpyou decide what car to buy, you can get information from the Insurance Institute for HighwaySafety ( www.iihs.org).3. ASK FOR HIGHER DEDUCTIBLES
Deductibles are what you pay before your insurance policy kicks in. By requesting higherdeductibles, you can lower your costs substantially. For example, increasing your deductible from$200 to $500 could reduce your collision and comprehensive coverage cost by 15 to 30 percent.Going to a $1,000 deductible can save you 40 percent or more. Before choosing a higherdeductible, be sure you have enough money set aside to pay it if you have a claim.4. REDUCE COVERAGE ON OLDER CARS
Consider dropping collision and/or comprehensive coverages on older cars. If your car is worthless than 10 times the premium, purchasing the coverage may not be cost effective. Auto dealersand banks can tell you the worth of cars. Or you can look it up online at Kelley’s Blue Book(www.kbb.com). Review your coverage at renewal time to make sure your insurance needshaven’t changed.5. BUY YOUR HOMEOWNERS AND AUTO COVERAGE FROM THE SAMEINSURER
Many insurers will give you a break if you buy two or more types of insurance. You may also geta reduction if you have more than one vehicle insured with the same company. Some insurers
reduce the rates for long-time customers. But it still makes sense to shop around! You may savemoney buying from different insurance companies, compared with a multipolicy discount.
6. MAINTAIN A GOOD CREDIT RECORD
Establishing a solid credit history can cut your insurance costs. Most insurers use credit information to price auto insurance policies. Research shows that people who effectively managetheir credit have fewer claims. To protect your credit standing, pay your bills on time, don’t obtaimore credit than you need and keep your credit balances as low as possible. Check your creditrecord on a regular basis and have any errors corrected promptly so that your record remainsaccurate.7. TAKE ADVANTAGE OF LOW MILEAGE DISCOUNTS
Some companies offer discounts to motorists who drive a lower than average number of miles peryear. Low mileage discounts can also apply to drivers who car pool to work.8. ASK ABOUT GROUP INSURANCE
Some companies offer reductions to drivers who get insurance through a group plan from theiremployers, through professional, business and alumni groups or from other associations. Askemployers, through professional, business and alumni groups or from other associations. Askyour employer and inquire with groups or clubs you are a member of to see if this is possible.9. SEEK OUT OTHER DISCOUNTS
Companies offer discounts to policyholders who have not had any accidents or moving violationsfor a number of years. You may also get a discount if you take a defensive driving course. If thereis a young driver on the policy who is a good student, has taken a drivers education course or isaway at college without a car, you may also qualify for a lower rate.When you comparison shop, inquire about discounts for the following:*
- Antitheft Devices
- Auto and Homeowners Coverage with the Same Company
- College Students away from Home
- Defensive Driving Courses
- Drivers Ed Courses
- Good Credit Record
- Higher deductibles
- Low Annual Mileage
- Long-Time Customer
- More than 1 car
- No Accidents in 3 Years
- No Moving Violations in 3 Years
- Student Drivers with Good Grades
The key to savings is not the discounts, but the final price. A company that offers few discounts
may still have a lower overall price.