Auto insurance is big business — With so many insurance companies vying for your business, and new insurers appearing all the time, it’s hard to know where to start, and how to find the best deal for you.
But it doesn’t have to be that way. We’ve compiled the most effective tips for lowering the cost of your car insurance to help you get started.
One of the biggest mistakes you can make when you’re insuring your vehicle is taking the first quote you are offered. You can save some money just by shopping around and comparing quotes from different car insurance companies.
- If you’re insuring your first vehicle, compare a number of quotes; and
- When your insurance policy is coming to an end, don’t simply let it renew. See what else is out there, and give your current insurer the chance to offer a more competitive renewal quote.
Make sure you’re comparing like-for-like cover, though. You don’t want to sign up for cheaper insurance only to realize it’s not as comprehensive as more expensive quotes. Remember, you’re looking for the best deal for the level of cover you need.
Choose the Right Car
The car you’re driving will affect the cost of your auto insurance. Cars which are cheaper to maintain and service can cost less to insure, but this isn’t the whole story. Insurers also consider:
- Car safety ratings;
- Anti-theft and security features;
- Frequency in claims for that vehicle;
- Common reasons for claims for the vehicle — for example, easily broken into; and
- Your driver profile.
Just because you’re a new driver, for example, doesn’t mean your insurance will be higher — some companies want to attract new drivers with the hope of insuring them for years to come. Some insurance companies also prefer to insure specific makes and models of vehicle. That’s why it’s so important to shop around.
Factors Vary by State
In some states, one insurer might charge new drivers more, but charge “good” drivers less. In other states, there might not be a difference. It’s important to note that insurance costs vary according to state laws and trends within their individual boundaries.
- Smaller, state-specific insurers often have high customer satisfaction ratings; and
- They’re often cheaper to take out insurance with than the larger, national companies.
Again, this is why it’s imperative that you shop around and take your time picking the right insurer for you.
Look for Discounts
There are easy savings to be made if you know where to look. Insurers often offer discounts to the kind of driver they’re hoping to insure, or simply to encourage more drivers to choose them. You can make savings by:
- Having a clean driving record;
- Insuring multiple cars under one policy;
- Bundling your vehicle insurance with, for example, home insurance;
- Receiving documents online and reducing postage costs; and
- Joining certain professional affiliations or organizations; and
- Paying the whole premium, or a significant part of the premium, off at once.
Usage or Pay-per-Mile Insurance
You can save money on your insurance by picking a policy which reflects your driving behavior. For example, if you’ll clock a low mileage that year, mileage-based policies, which are available in some states, are economical. The insurer might want to track your driving, but it’s worth it for the savings you’ll recoup.
Be Careful with Add-Ons
You might take out more expensive cover than you need if you choose optional extras that go beyond your requirements or are already covered elsewhere. For example, your other insurance policies might already cover legal assistance. It’s also best to “package” breakdown cover with your insurance policy, so you’re not paying for two separate policies.
From shopping around to simply making informed choices, we hope these tips will help you find the perfect insurance quote for your needs.