Tips For Lower Car Insurance Rates

If you’re looking to find low cost car insurance, the answer may be closer than you think. In fact, you may not even need to change insurers in order to lower your car insurance bills as you can find some cost savings through reviewing your current car insurance policy.One way to turn your current insurance into low cost car insurance is to pay your entire bill up-front instead of opting for the monthly installment plan. While it can be challenging to come up with the larger sum up front, paying your entire premium at once can considerably lower your bill. If your monthly service charge is $5.00, paying your bill at once will save you $30 over six months, or 6% on a $500 car insurance policy, which can add up to some pretty significant savings.

Another way to turn your current policy into low cost car insurance is to thoroughly review your bill to ensure that you need all of the coverage that you are currently paying for. For example, if you are a AAA member, you may not need coverage for towing under your car insurance policy. You can choose not to have rental car coverage if you don’t think that you will need it in case of an accident. Removing these charges from your bill can bring you even closer to low cost car insurance.

If your car is older, it may make sense for you to remove collision coverage from your car insurance. Let’s say that you have a 2008 Dodge that is worth $1750. If you’re paying for collision coverage on the car, you are most likely paying at least $100-$150 per year to cover the car in case you are in an accident and require work to be completed. Since this coverage is almost 10% of what the car is actually worth, it doesn’t make sense to pay for collision coverage on the car in this case.

In order to ensure that you have low cost car insurance, you’ll also want to check your deductible amount. The lower the deductible amount (or the amount that you will pay for work completed if you are at fault in an accident), the higher insurance cost. It is a risk to increase your deductible level, but this may make sense from a financial standpoint. If you haven’t combined your home and car insurance to one insurer, you may want to consider doing this as well since this can also decrease your rates by 5-10%.

Completing these steps can put you on your way to turning your current policy into low cost car insurance. Of course, you can always look at competitors to lower your rates and you should apply this advice to any plan you consider, whether its your current policy or a new one.

Some Things To Consider When Buying Insurance

Despite the fact that auto, home and health insurance rates are on the rise, there are always ways to save money on these necessities with a little ingenuity. In our free enterprise economic system, you can always find a better deal on anything by comparison shopping. The trick is to know, down to the last detail, the insurance coverage you are comparing.

Auto Insurance
Your agent will determine your auto insurance rates by assessing your risk and comparing it in an insurance tier system which considers your age, gender, profession, type of automobile, credit rating, driving record, and other factors. Now, some of these factors, like age and gender are not subject to manipulation, while some of the others are.

Credit scores are used by insurers to predict how responsible a person you are. If you have a habit of being late on your credit card payments, insurers can raise your rates. Improve your credit report by repairing any errors and stay on time paying your bills. Everyone knows blemishes on your driving record can cause your insurance rates to go up, but you can also do something about that. Aside from criminal offenses, minor traffic violations can be erased by completing a Driver Education Course.

By raising your deductible, you can also lower your rate. By installing theft deterrents like the LoJack Theft Recovery System, some insurers will discount your rates by up to 35%. Buying a previously owned vehicle instead of a new car is another big money saver.

Home Insurance
Homeowners are acutely aware of the importance of keeping within a budget and saving here and there. Start off with the no-brainers first, like comparison shopping and improving your credit score. Raising your deductible by $500 can save you 12% on your premiums. Bundle your home and car insurance for a discount. Install dead bolt locks, smoke detectors, and burglar alarms. Make payments electronically to save a $5 per payment handling fee. Check your home insurance policy yearly to change your coverage if you add or remove valuable assets from your home.

Health Insurance
Those of us with an active health insurance policy, either from our employers, or purchased outright, can save money on health insurance rates by raising the deductible and also asking for generic rather than brand name prescriptions. During the open enrollment period which occurs once a year, insurers allow members to make changes to their coverage. This is the only time you can remove a dependent who is no longer using your policy or remove other coverage that can save you on your premium

As more employers are cutting back on benefits they offer new hires, group health insurance is no longer something that can be counted on. If you do not receive health insurance benefits, one way to obtain cheap health insurance is through membership in an association or club which has procured health insurance at a reduced rate for its members. AARP (American Association of Retired Persons) offers health insurance discounts for its members. If you are a member of a trade association, such as National Association for the Self-Employed you can sign up for coverage through them.

Tips For Keeping Your Auto Insurance Rates Low

If you can take the measures now to ensure certain things are in order, you’ll definitely save money in the long run. Hence, the existence of different types of insurance. If you have read this blog for any period of time, you know I extol the value of buying insurance (especially health insurance). Being caught uninsured can only lead to ever-increasing costs–and stressful headaches–down the road.

In addition to health, life, and home insurance, it’s important to not only have automotive insurance, but to make sure you keep your payments current and that you’re getting the best bang for your buck. (The only way to guarantee this is by doing your research. Another value whose virtues I extol on this blog. My mantra: Research, research, research.)

But, I digress. Back to the idea of prevention. We often take car of our cars when that check engine light comes on. We change the oil every 3,000 miles. We wash our cars. Each of these is a preventative measure. Too often though, many of us don’t take the necessary precautions that might prevent our cars from being stolen or the headaches that ensue if our cars our robbed.

I came across the following helpful hints from Geico. Some preventative measures that can keep you save and, possibly, limit your financial loss if your car is stolen. My responses/comments are in parenthesis.

  • Keep your vehicle locked at all times, even while driving. Close all windows and sunroofs, no matter how hot it is. (I live in L.A. My car is locked at all times. The windows and sunroofs however, are sometimes open. It’s hot. I live in L.A.)
  • Never leave your keys in the car. (What is this? 1963? Who leaves their keys in their car?)
  • Avoid leaving valuables inside your vehicle where passersby can see them. (Sometimes, I leave things out for the world to see. I need to get better with this.)
  • Install an anti-theft system in your vehicle if it doesn’t have one. A mechanism that locks onto the steering wheel can be a very visible sign that you’ve taken steps to protect your vehicle. Ignition cut-off systems prevent a car from being started. Some new cars come with passive alarms that activate automatically when the key is removed from the ignition. One system emits a signal that can be tracked by the police. Thieves are reluctant to steal vehicles that can be tracked and recovered quickly. Many insurers offer discounts for these types of systems. (That last line is important. Spend a little money now to save a lot down the road.)
  • Beware of the “bump-and-rob” technique. Carjackers bump your car from the rear, then steal it when you get out to look for damage. When stopped at a traffic light, leave room to maneuver around the vehicle ahead if you need to. If another car bumps yours and you feel threatened, drive to a populated area. If you have a cell phone, call the police for assistance. (Have you heard of this? Terrifying. I’ve also heard that insurance fraud is being committed by people who work together driving two different cars. The car in front of you will slam on his brakes causing you to stop abruptly…but the driver behind you–who is in cahoots with the car in front of you–rear ends you because of your unsafe driving. How ridiculous is this?)
  • Do not leave registration or title in the car. Too often a car thief is pulled over and gets away from the police because he or she can produce the auto registration. If multiple drivers use the vehicle, the best suggestion would be to hide the registration in a secret location that only the owners know. (Interesting…never thought of this.)
  • If confronted by a carjacker, do not resist. Cars can be replaced; you can’t. (As stated above: I live in L.A. I am ready to walk away from the scene. Car-less, yes. But alive.)
  • Have your car’s vehicle identification number (VIN) etched on each of the windows. Car thieves want to get off cheap. They don’t want to go to the expense of replacing all the glass. (How much would this cost?)

Some things to think about and ponder. I can’t imagine the frustration of having your car stolen. In fact, I have to clean my car out tomorrow, just to make sure no important papers or objects are in it…

Auto Insurance Overview

Although most of us are required–by our different state laws–to have auto insurance, I wonder how many of us know what the ins-and-outs of our policies are. In continuing with my “Insurance Overview” series, I thought I would delve in and explore the different types of auto insurance policies, what they means, and–in a later post–factors that can lead to lower rates.

Different Types of Auto Insurance

Liability insurance covers for the damages you cause to another person or another vehicle as the result of an auto accident. Types of liability insurance include:

  • Bodily Injury covers all claims for injury or death (and the cost of a legal defense) in the event that you injure someone as a result of your legal liability.
  • Property Damage pays for damage that you have caused to someone else’s vehicle if you are legally responsible for the accident. This does not cover the cost of repairing your own car.
  • Medical Payments covers the cost of medical and funeral expenses in the event that you–or passengers riding in your car–are killed or injured in a car accident regardless of fault. It also covers you and your family members (as pedestrians or passengers) in case of injury as the result of a car accident.

Physical Damage covers damages to your car, repair costs, and the cost of a temporary replacement vehicle.

  • Collision covers damages to your car regardless of fault. You will pay a base amount to fix your car (a deductible). Anything over that deductible the insurance company will cover. If you increase your deductible–i.e. the amount you pay towards the repair of your car–it will lower your insurance premiums.
  • Comprehensive insurance covers damage to your car as a result of (almost) anything else. Damages caused as a result of theft, fire, vandalism, or floods (among other things) are all covered under comprehensive insurance. Again, by increasing your deductible you can lower your premiums.

Other Types of Insurance

Uninsured/Underinsured coverage is somewhat self-explanatory. You are covered for the damage to your car if the other driver who caused the accident is either uninsured or underinsured.

Other policies cover loss of use, loan/lease payoffs, and roadside assistance. As always, do your research. This post is to serve as a helpful starting point in navigating the chopping auto insurance waters.

Tips For Saving Money On Auto Insurance

In addition to knowing exactly what to look for when buying auto insurance, you should also know that there are ways to save money and reduce your premium. Below are some things you might think about when purchasing auto insurance:

When Buying a Car When shopping for a car, keep in mind that some cars are going to be more expensive to insure than others. If auto insurance premiums are a going to be a factor in your annual budget, then buy a lower profile car.

Comparison Shop When buying auto insurance, remember that the cost of similar policies can differ greatly from company to company. Research the policy you want and then compare specific quotes from at least three different insurance companies.

Keep A Good Credit Rating Your credit rating is one of the primary factors insurers use to set your premium. Be sure to keep your credit in check.

Low Mileage Discounts My commute drastically changed a year ago, but it didn’t dawn on me to call my insurance company for some time. The result was a sizeable decrease in my premium.

Pay Annually If you have the cash to pay your auto insurance annually, do it. For those of you who pay your premiums on a monthly basis, you’re being charged a transaction fee that, in the long run, adds nearly $100 to your insurance costs every year.

Use the Same Company You’ll receive a discount if your the same insurance company covers your home and your car.

Ask Your Agent Talk to your agent about other possible discounts that you may not know about. In addition to what I’ve already covered, here’s a checklist of other areas that might end up saving you money:

  • air bags in your car
  • anti-lock brakes
  • good driver discount (meaning you haven’t been in an accident in 3+ years)
  • completion of driver training/defensive driving courses
  • good student discount
  • anti-theft devices
  • multiple car/multiple driver discounts
  • discounts for drivers over 50
  • …and there may be others your company offers: ask!