How to Save on Auto Insurance

Not all of us are lucky enough to have easy access to public transport or sometimes it’s not feasible or sometimes too time consuming. We have to rely on our good old car to more around and earn living and with car come necessary overhead of car insurance. Well all I understand is a penny saved is a penny earned and we can use that penny where we need it most. So following are few ways we can reduce or eliminate financial burden of car insurance

1. Have a close look on policy: This is probably one of the prime reasons we pay more than we should. Auto Insurance policies are difficult to understand as they include many details in form of numbers and codes which we cannot understand and sometimes relevant for just internal use of insurance companies.  Check your policy details closely for any mistakes like your postal code, trim level of car, age, sex, marital status, years of experience, KMs driven to work and annually: Many a times a small mistake by your insurance broker can cost you a lot and its very difficult and time consuming to recover losses
2. Maintain a good credit score: Almost all insurance companies check your credit score before offering you quote and some of them factor your credit score for the premium charged. Some companies even provide extra discounts for person having a better credit score considering that a preferred client
3. Maintain a good driving record: Better driving habits leads to better insurance rate. Some companies even offer accident or claims free discount
4. Insure all autos with same insurer: This way you get multi vehicle discount which sometimes is 15% or more
5. Insure home or contents insurance and auto with same insurer: More lines of business you have with your insurer better discounts and better bargaining power you have
6. Understand the coverage you need: Buy insurance for perils you are worried about and want insurance companies to pay for in case of loss. For example consider removing collision and comprehensive in case of older vehicle or for a winter beater. If you are worried about theft of car take specified perils coverage instead of comprehensive, that alone can save you lot of money
7. Buy accident forgiveness: Accident forgiveness coverage means if you are in an accident and that accident is your fault, insurance company will forgive that accident or they will not increase you premium on renewal because of that at-fault accident. Not everybody is eligible for that. Only drivers who are accident free from last 6 years are eligible. It’s an optional coverage so it does cost you. But in case of at-fault accident premium increase is much higher and that accident affects your rates for 6-10 years. With this coverage at least first one will be forgiven. Remember single vehicle accident is considered at-fault accident
8. Buy rental car or non-owned vehicle coverage: Buy this optional coverage that gives you a rental car in case of accident. It’s also called loss of use coverage. If you travel a lot or without a car it will difficult for you to go work or you have no access to second vehicle this coverage is very useful. Cost varies between different companies but much cheaper than if you have to rent a car for a week
9. Choose deductible you are comfortable with in case of claim: I never advice to choose a higher deductible just to reduce your premium. Rather my advice will be choosing a deductible that you are comfortable with in case of loss. Deductible is the amount of money you need to pay from your own pocket before insurance company pay out claim. Example would be comprehensive coverage with (which covers any windshield damage) deductible of $1000. In case of windshield breakage you have to pay for any damage up to $1000 and then company will pay. If cost of repair is less than $1000 insurance company will pay nada. So there is no use have windshield coverage with $1000 deductible when you can never claim it
10. Shop around: Before signing auto insurance contracts shop around. You should take at least 4 quotes before you sign up. Insurance rates change frequently so don’t assume that last year X company was providing higher rates so this year also their rates will be stay high
11. Compare apples to apples: When shopping around for auto insurance compare with same coverage and same deductibles. Your comparison will be wrong if from one company you request $0 deductible and from other company you request $500 deductible or if you add optional coverage available  that you are eligible for
12. Give yourself time to think about: Start shopping around for quotes 30 days before renewal is due for your policy. That way you have enough time to have quotes mailed to you from other companies instead of deciding in a rush
13. Ask about discounts: Discounts varies from company to company like  group insurance discount, membership discount like CAA or sears, student, retiree, occasional driver discount, hybrid vehicle, aftermarket alarm system, snow tire discount, online quote discount, driver training course, lower mileage driven, pay in full discount
14. Inquire if there are any surcharged applied: Sometimes companies charge admin fees or surcharges for high performance vehicles, interest charged for monthly payment, very high mileage driven
15. Pay you insurance on time: Plan and budget for car insurance because if you miss a car insurance payment, insurance companies charge you NSF fees anywhere between $25 - $40 and bank charges you separate NSF charges anywhere between $40-$60. With proper planning you can eliminate these extra charges