Due to the rising costs of vehicles and their numbers on the road, and the increased frequency of accidents and claims, auto insurance premiums continue to rise. However, lower auto premiums are available, and it only takes a little effort on your part to find coverage at a lower cost. Just like managing your credit rating and your investments is important, staying on top of your car insurance can pay off big time regarding lower rates and better coverage.
Do your own research. Advertisements claim you can save hundreds of dollars simply by switching insurance companies. If you could save money just by moving from one company to another, wouldn't that mean that there is only one company out there that can give you the lowest rates? Not likely.
Even though most insurance agencies set their premiums based on probabilities and averages, they do not treat all insured drivers equally. It often depends on your individual driving history, your needs, and your credit health, among other factors. Sure, your neighbor may get a lower rate by moving to another insurance provider, but that does not mean you will.
It is up to you, the savvy consumer, to do your research and take the effort to get the best coverage you can at an affordable rate.
Ways to Lower Your Insurance Costs
Here are some tips you can follow to lower your auto insurance premium.
Install Security and Safety Devices
Although the U.S. now requires all new vehicles to have features like air bags and anti-lock brakes, if you have an older car, make sure you inform your insurance company of your vehicles safety devices. That can save you some money upfront and on your monthly premium bills. As an example, many insurers offer up to a 25 percent discount to consumers under the Comprehensive portion of their policy just for having an anti-theft system installed on their vehicle.
Pay Up Front
Some insurance companies offer you a discount if you pay a year upfront instead of paying a monthly payment plan. If you can afford to pay up front, you are not at risk of losing it if you do decide to switch companies. All insurance companies are required to pro-rate your entire bill and give you a refund for any days after you terminated coverage.
Cut Your Miles
Many auto insurance providers offer lower rates to drivers who put fewer miles per month on their vehicles. That is something that not only makes sense to you but for them as well. Moving closer to work not only saves you on commute time and fuel, but it could also save you money on your car insurance premium as well. If you do move closer to your workplace or cut down the number of miles you drive significantly, give your insurer a call to see if you can take advantage of a discount. Many insurers will offer pay-by-the-mile programs that can cost you less on standard plans if you hardly drive at all.
Do Some Insurance Premium Comparison Shopping
Rates will vary between companies; therefore it pays to do some comparison shopping. Get several quotes before deciding on a company. Contact insurers directly or go online to do some quote shopping. You may even get information from your state insurance department of price comparisons between major insurers.
Get some quotes from various insurance providers. Some providers have company agents to sell insurance while others market through independent agents who represent a range of insurance companies. Some don't use agents at all. They do their selling to consumers directly through the Internet or over the phone.
Don't make it a point to shop by price alone. Ask around to family and friends what their recommendations are. See if you can get information by your state insurance department about consumer complaints. Choose a company representative or agent who takes the time to be thorough with you and answer all your questions.
When you are a safe driver, your insurance company just may offer you a better rate. Stay out of accidents and avoid speeding and you may get classified as a 'safe driver' by your insurance company and receive a five percent or more discount on your monthly rate. Moreover, for every three years, you go without an accident or traffic violation, your car insurance company may even further reduce your rate.
Auto insurance prices are likely to continue rising in the future. However, this does not mean you cannot reduce the sting by following these tips above.
Insurance products are offered through Bangor Insurance, a division of Bangor Savings Bank.