By Amanda Smith
Owning a car can cost quite a bit of money and many people fail to take into account all the costs which are associated with owning a car. Loan payments, gas, maintenance, taxes and depreciation all comprise a significant financial investment. And that’s not even including yearly insurance requirements. For most people, insurance accounts for a significant portion of their yearly budget. And when it comes to dealing with insurance costs, some people just don’t know how to reduce this particular type of financial obligation. Don’t fall in the group of people who pay unnecessarily high insurance costs. Use these 5 ways to save on car insurance:
Weigh your options
Shop around. Find the best rates. If you’re like some people, you may feel constricted when it comes to your auto insurance options. The good news is that you don’t have to settle for an insurance carrier just because the office is located near where you live, or because that’s the provider you’ve always chosen. Shopping for the best rates with such sites as AutoInsurance.US is a great way to get more saving on your monthly premiums. Online auto insurance providers offer competitive rates because they don’t have to deal with the overhead of a traditional insurance office.
Get only the coverage you need
Some people pay more in insurance coverage each year than their car is worth. Obviously, this doesn’t make sense financially, and can lead to you paying unnecessary insurance costs. If you have comprehensive or collision insurance, consider dropping it for older models. Ask a financial professional whether it’s appropriate to fully insure your vehicle.
Ask for a deductible increase
Increasing your deductible lowers your insurance premiums so that, assuming you don’t make a claim over the course of the year, you pay less for auto insurance. There is a certain level of risk associated with increasing your deductible, especially if you don’t have money set aside to cover the deductible if you have to make a claim. But if you know you can pay the deductible in the event of an accident or other claim situation, asking for a higher deductible increase insures you pay less in premiums.
Ask for discounts when you apply
One of the best ways to instantly save on insurance is to ask the provider if they offer discounts. For example, group discounts through employers and financial institutions may enable you to save money on premiums as a part of an agreement between the provider and the partner. You can also ask about discounts associated with car safety features, low-mileage driving, a clean driving record or completion of driving safety courses.
Keep a clean credit report and safe driving record
Two significant criteria insurance companies use when determining your premiums are your credit history and your driving record. There’s not a better way to save on insurance than to clean up your credit report and FICO score, and to demonstrate that you are a safe responsible driver who is less of a risk to insure. Correcting these issues can take time, but they ultimately have a heavy impact on how much you pay for insurance. Saving money on auto insurance isn’t that difficult when you know where to start. Try these 5 tips and you can save money each year that could be better spent on gas or other expenses in these tough economic times.