Your vehicle insurance prices are calculated by car insurance companies based on a number of criteria. They consist of:
- Age: Middle-aged drivers typically pay the least in insurance premiums, while younger drivers typically pay more. Adding a teenage driver to an existing family insurance can help you save money because teen drivers are particularly expensive to insure with an individual policy.
- Driving record: A driver with a spotless record will pay less than one with a speeding ticket, an accident, or a DUI.
- Vehicle type: Sedans are considered to be lesser risk vehicles than sports cars.
- Credit score: Your rates often improve as your credit score rises. The likelihood that a driver will pay premiums and file a claim is often determined by a driver’s credit score by auto insurance providers.
- Location: The risk of submitting a claim is assessed based on where you live, which could result in higher or lower charges. Your car insurance premium can be influenced by a variety of location-specific variables, including the frequency of accidents and vehicle thefts in the neighborhood as well as the presence of hazardous intersections.
While these unique elements affect how much you pay for auto insurance, it’s also conceivable that you’re overpaying for coverage. For instance, if you just bought a new car, many lending providers would need you to carry full coverage. You might not need full coverage if your car is paid off, especially if it has significantly depreciated.
Enter your personal information into our quotation calculator to get an estimated rate for auto insurance to find out how much you might pay.
10 Ways to Reduce the Cost of Your Auto Insurance
There are various actions you may take to lower the price of your auto insurance. They include comparing prices and improving your credit score as well as altering the kind and quantity of coverage you have. While some actions can be taken right away, others will take some time to have an impact on your auto insurance premiums.
1. Look for quotes elsewhere
Shopping around with at least three different auto insurance providers is the quickest and simplest approach to lower auto insurance premiums. If you use online vehicle insurance comparison tools that can estimate the costs of multiple carriers at once, this could take less time. Even though car insurance companies consider many of the same things for every driver, the way they assess those things differs, which can result in reduced car insurance premiums for you. You should give each company you contact with the same personalized information to ensure that you receive comparable estimates. You should also request quotes on the same day.
2. Look for any and all discounts
While you might be aware of some of the discounts provided by auto insurance providers, such as those for having several policies or being a good driver, some providers also provide discounts for owning a vehicle with anti-theft systems or other safety features. If you reduce your annual mileage or set up an automated premium payment, they might also give you a reduction. Find out what discounts are available to you for cheaper auto insurance by speaking with the agent.
3. Improve Your Credit Rating
Start by checking your credit report to make sure it’s correct if your credit score might use some improvement. Sometimes errors are discovered on credit reports, and merely getting rid of them will improve your credit score. Making on-time payments to creditors, paying off debt so you utilize less than 20% of your available credit, and refraining from creating new accounts are further ways to raise your credit score. You might pay less for auto insurance as your credit score rises.
4. Register for Savings Monitored by the Driver
Nowadays, a lot of auto insurance providers provide initiatives aimed at reducing your premiums based on your driving style. Using equipment placed in your car or on your smartphone, they keep tabs on your daily driving. Examples include the Drive Safe and SaveTM campaign from State Farm and the Snapshot initiative from Progressive.
5. Clean Up Your Driving History
Let’s say your driving record already includes a speeding ticket, DUI, or moving infraction for distracted driving. In that situation, there isn’t much you can do to change it other than wait for those occurrences to become less significant over time in terms of assessing your driving history. What you can do is take precautions to avoid getting any extra moving offenses, DUIs, or speeding citations that could raise your vehicle insurance rates.
6. Modify Your Insurance
It’s crucial to frequently assess your auto insurance policy to see whether you still require it. For instance, the vehicle loan lender may insist that you carry full coverage if you buy a new automobile. But, this comprehensive coverage might not be essential any more if your car is paid off and more than a few years old, which would result in lower premiums. Evaluate the amount of coverage you require, then request tailored quotes for that coverage from at least three different providers.
7. Raise Your Deductible
By increasing your deductible, you can cut your auto insurance rates even more quickly and easily. If you have the financial means to pay a greater deductible in the event of a claim, your automobile insurance premium will be less expensive.
8. Combine your home and auto insurance policies
Insurance providers will reward you for using them for all of your insurance requirements because they want to earn as much of your business as they can. You may be able to get cheaper car insurance rates by combining your renters’ and auto insurance, adding more vehicles to the same policy, or bundling your homeowners’ and auto insurance.
9. Change your vehicle
While deciding your car insurance rates, car insurance companies also take into account the kind of vehicle you drive. They take into account things like the vehicle’s safety history, likelihood of theft, and the cost of accident-related repairs. Typically, people view sedans and minivans as being less dangerous than sports cars and high-end vehicles.
10. Enroll in a course on defensive driving
Your driving abilities may be enhanced by taking a defensive driving course, making you a lesser risk for auto insurance providers to cover. If you finish a recognized defensive driving course and submit proof of completion, many auto insurance companies give you a discount.
Tips for Comparing Car Insurance Quotes and Companies to Reduce Costs
One of the best ways to reduce car insurance costs is shopping around for personalized quotes from at least three different car insurance companies. When comparing quotes, you want to look at the coverage, see how much the deductible is and evaluate available discounts.
- Make sure the car insurance quote is for the same coverage across the board. Liability versus full coverage or even varying amounts on full coverage policies can result in different quotes. The quote should be for the same type of coverage to ensure they are comparable.
- Look at the available deductibles for the coverage in your insurance quote. Raising the deductible could result in lower costs.
- Ask about all available discounts offered by each car insurance company. These can dramatically reduce car insurance costs.
- Remember to ask for and compare quotes on the same day. Insurance rates fluctuate frequently, so you want to get quotes at the same time to ensure a fair comparison.