4 Ways to Save Money on Auto Insurance
How to Save Money on Auto Insurance
Due to rising inflation, you’re now likely to pay more for auto insurance. According to the S&P market intelligence report, insurance companies have increased their rates this year by 8.3% on average. Others have increased insurance rates by double digits to help cover increasing costs.
Apart from inflation-related dynamics, insurance companies have also witnessed an increase in the number of claims. This increase is due to more Americans driving longer distances than they did during the pandemic. As a result, the rates of accidents and car-related crimes have increased.
There’s also an increase in the prices of new and used cars. Due to these reasons, an increase in premiums makes more sense to insurance companies. Despite the increase, it’s still possible to save money on auto insurance.
Let’s see four ways you can do that.
Increase Your Deductible
A deductible is an amount you agree to contribute in case of a loss resulting from auto accidents. You have to pay it first; then, the insurer will pay the remaining balance. In sum, the higher the deductible, the lower the insurance rates.
To save money on car insurance, you have to pay a higher deductible. Let’s say you increase your deductibles for property damage liability coverage from $250 to $500.
Then an accident happens, damaging properties worth $5,000. Initially, you would pay $250, and the insurer would pay the balance of $4,750. But after the increase, you’ll pay $500 and the insurer $4,500.
Since the amount you get from the insurance company reduces, the premiums will also reduce. However, you may have to set up an emergency fund to pay your contribution.
Take Advantage of Discounts
Many companies offer discounts to customers who buy several insurance products from them. So, it’s a good idea to get several products and services from one insurer, such as auto-insurance and homeowners’ insurance.
Other channels for getting discounts include:
- Having advanced safety features such as airbags, anti-theft devices, and anti-lock brakes
- Taking a defensive driving course
- Taking additional driving lessons and having good grades for teen drivers
- Paying your premiums in advance, such as annually or semi-annually
- Insuring more than one car under one policy
- Sharing your driving metrics with the insurance company
- Driving less frequently, in which case you get a mileage discount
Keep in mind that insurance coverages are based on individuals. The insurers offer them at different rates based on many factors. So, if you qualify, grab as many discounts as possible.
Maintain A Clean Driving Record
Being a good driver can help reduce car insurance rates. That means avoiding moving violations like speeding and running a stop sign. If you’ve never had an accident, received a traffic ticket, or been arrested for driving while intoxicated, you probably have a clean driver’s record.
If you violate traffic rules in another state, your violations will follow you to Florida. If you lend your car to another person, their driving habits will affect your driver’s record. In Florida, your driver’s record is open to the public. It will take 3 to 5 years to remove those violations and accidents from your record.
Also, if you make claims for liability insurance or comprehensive coverage more frequently, you’re a high-risk driver. Here, you’ll pay a higher insurance bill because car insurance companies consider you a high-risk policy holder.
Improve Your Credit Score
Insurance companies use credit scores to predict the possibility of making payments to cover damages. A low credit score presents more risk than a higher one. So, if you have a high credit score, you’ll pay less money on car insurance.
To boost your credit score and reduce the cost to insure, minimize your borrowings. Ensure you always pay your mortgage and car payments on time every month. That will show the insurer you’re responsible and present a lower risk.
Act Smart and Save Money on Auto Insurance
Even though auto insurance rates are increasing, you can still save a few hundred dollars on premiums by taking certain steps. These include raising your deductibles, having a clean driving record, exploiting discounts, and improving your credit score. But you can do more, such as comparing what you pay in your auto insurance company with what other companies charge.
If you’re looking for auto insurance or homeowners’ insurance in Clearwater, talk to Coleman Insurance Agency. We can advise you on the best companies offering car insurance in Clearwater based on your needs. Call us today and let us help you save money on auto insurance.
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