27 Jun How to Save on Auto Insurance – Know Your Options
Our fast-paced lives never seem to slow, and often require a car to get us where we need to go. Automobile insurance is required in Florida, but premiums can vary greatly among insurance companies, even when the same set of criteria (covered driver’s age, gender, driving record and vehicle, for example) is involved. According to a report by insurance search engine The Zebra, the average American pays $1,427 annually for auto insurance. Rates are 20% higher than in 2011 and are expected to continue rising. While the cost of auto insurance premiums greatly depend on where you live, there are strategies you can use to keep premiums at a minimum.
Tips on How to Save on Auto Insurance
Stick to one company – Imagine that you receive a car insurance quote from an insurance agency that is less than the quote of the company you have purchased the rest of your insurance from. Are the savings worth choosing the separate company? It depends. Always consider the cost of paying a separate company, versus a multi-line discount with your current one. More often than not, the convenience and the discount will cover the difference. Compare the two, as the decision can save you up to 10% off your premium total.
Research before you buy – Besides your location, insurance premiums depend largely on your car’s make, model and year. Not only is your personal risk assessed, so is your vehicle’s ‒ such as size, horsepower and likelihood of theft. Insurers also prefer new technology, including “green” initiatives and safety features. A few of the most discounted safety features include electronic stability control (ESC), anti-theft systems, and emergency response systems. Before you purchase a vehicle, always request an auto insurance quote from your agent.
Drive with caution – Auto insurance premiums are primarily determined by your assessed risk. Speeding tickets, prior accidents and more recently, distracted driving, will spike your rates. Your risk can also include the actual time you spend on the road. If you are not a frequent driver, inform your agent, as less time on the road decreases your chance of being in an accident, and could mean a lower premium.
This falls into a “low-mileage discount,” one of the most beneficial and overlooked discounts. The definition of low mileage” varies with each provider; however, the mileage cap typically falls between 7,500 and 15,000 miles per year. It may apply to carpoolers, senior citizens, students, those who work close to home or work from home, and secondary car owners.
Drop coverage you don’t need – A good practice is to regularly re-evaluate the coverage you are paying for. It can clash with your updated needs, making you pay for services or protection no longer relevant to your life. For example, keeping coverage on older vehicles may actually be more costly than the value of the car. You may also find overlapping coverage. If you are unsure, you can always contact your agent to define what is and is not covered by your policy. If there is coverage you do not need, removing it may reduce your auto insurance bill.
Avoid a monthly bill payment – Paying your premium on a monthly base can come with add-on fees, easily avoided when you pay on a six- or 12- month plan. If this is too large an amount to pay at once, you can divide the premium by 12 and deposit that amount into a savings account each month. This will ensure that you always have the money available when the bill is due.
Improve your credit score – When it comes to determining your risk, most financial institutions rely on your credit score – including 90 percent of auto insurers. If you have a high score, you will likely benefit from a financial stability discount. Each insurance company has its own method for determining a financial stability discount, and the methods are kept proprietary. For this reason, you may find a significant difference in rates by shopping around if you have a lower credit score. Regardless of your credit score, of course, be sure to always pay your premium on time!
Talk to a Strassman Insurance Group Agent
Our experienced agents at Strassman Insurance Group contact our policyholders every year to review their policies to see if they’re eligible for additional discounts based upon life changes or other factors that affect their coverage. Please contact us at any time if you’d like to discuss possible discounts you may be eligible for before then. If you’re shopping for auto (or any) insurance, call us for a free, no-obligation consultation, or fill out our easy online form to get a quote with the coverage you need at a competitive price. Contact us today.