How To Get The Lowest Auto Insurance Rates |
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Mike Miscal
2 November 2012
Auto insurance is mandatory in almost every state. There are many ways to save on car insurance if you know the right questions to ask and utilize good strategies for keeping your premium rates low.
Tip #1 ? Compare Rates
Car insurance rates can vary widely from carrier to carrier. To get the best rate possible, it is important to compare rates from several different sources before making a buying choice. Look at rates from at least three different companies and compare the same kind of insurance and same deductible levels.
You can get rates for comparison from several different sources. Insurance comparison websites are an excellent source because you can enter your information one time and get quotes from several different companies within a short period of time. Keep in mind that the quotes are preliminary and an agent or insurance company representative will need to gather additional information from you to provide a firm rate quote.
You can also get rate quotes from independent agents and directly from insurance companies. Independent agents can provide you with information about the best kind of insurance for your needs. Insurance companies can provide you with information about other insurance products you may want to purchase.
Tip #2 ? Only Buy What You Need
It can be tempting to want to buy maximum coverage when you are buying car insurance. However, if you have an older car, you may be spending money you could be saving.
Comprehensive and collision insurance are great protection if you have a newer car or your car is financed. These kinds of auto insurance pay for damage to your car if you are involved in an accident. However, the coverage only pays for repairs if the cost to repair the car is less expensive than the value of the car. For older cars, in many cases, it is too expensive to repair the car and the insurance company will simply declare the car a total loss and pay you for the value of the car at the time of the loss. Frequently, this value is far less than Blue Book value.
Instead of spending money on premiums for collision and comprehensive car insurance, save the money you would be putting toward premium payments. You can use this money to pay for a new car if your car is damaged beyond repair.
Tip #3 ? Bundle Policies
Most insurance companies will offer lower rates if you purchase more than one type of policy with your car insurance. You can buy homeowners, rental, boat or another type of insurance policy and get reduced rates on all of the policies if you bundle them together.
Tip #4 ? Ask About Discounts
Almost all car insurance companies offer a wide range of discounts, all you have to do is ask about them and find out which ones can be applied to your policy. For example, if you are in school or are insuring a teenage child or young adult who is in school, ask about a good student discount. Other common discounts include safety equipment, good driver, older drivers, defensive driving course and many others.
Tip #5 ? Maintain Excellent Credit Scores
Many people do not realize it, but your credit score can have a dramatic effect on your car insurance rates. If you have a poor credit score, insurance companies consider you a high risk driver and will charge you higher rates for car insurance. By paying your bills on time and maintaining good credit you can realize lower auto insurance premiums.
If you have been working to clear your credit and improve your credit scores, make sure you shop for better insurance rates the next time your insurance comes up for renewal. As your credit score improves, your rates should also improve.
Buying car insurance is a relatively easy process and there are lots of ways to save money on your premiums. By shopping wisely and asking for discounts, you should be able to find affordable rates each time you renew your policy.