8 Ways to Save Money on Car Insurance

Featured image by Tumisu via Pixabay

In today’s economy, everyone is looking for ways to save money. While car insurance may not be the most expensive item in your budget, it can certainly add up over time. It can be a significant financial burden, especially for those on a tight budget. This can be especially critical if your car is a key part of running your business. Thankfully, there are a few simple ways to save money on car insurance premiums.

1. Bundle Your Policies to Save Money on Car Insurance

You may be eligible for a bundling discount if you have multiple types of insurance with the same company. For example, you can usually get a discount if you have your auto and homeowners insurance with the same company. Some companies also offer discounts if you bundle other types of insurance, such as life, health, or renters insurance.

However, that’s not the only advantage. You achieve greater efficiency and convenience when you have multiple policies with the same insurer. For example, you only have to deal with a single insurer regarding billing, claims, and customer service. Bundling can also help you to manage your risk better. By having multiple policies with the same insurer, you can more easily ensure that you have the coverage you need in case of a claim.

2. Take a Defensive Driving Course

This is a great way to refresh your knowledge of road rules and learn new safety strategies. Many insurance companies offer discounts to drivers who have completed a defensive driving course. These courses cover a variety of topics, such as how to:

Use proper braking techniques
Deal with aggressive drivers
Stay calm and focused in stressful situations
Handle inclement weather conditions
React quickly and effectively if an accident does occur

A defensive driving course can also help reduce stress levels when behind the wheel. By learning how to anticipate danger and avoid potential accidents, you can enjoy a more relaxed driving experience. With the convenient online courses available today, there’s no excuse not to take one.

3. Shop Around for Car Insurance

Many people overpay for car insurance because they choose the first company they come across or the one their friends or family recommend. However, shopping around is the only way to ensure you get the best car insurance deal.

There are several ways to get multiple auto insurance quotes, including visiting the websites of different insurers and using a quote comparison site. Provide the same information to each company so that you’re comparing similar coverage.

When shopping, consider other factors such as the company’s financial stability, customer service record, and coverage options.

4. Raise Your Credit Score

Your credit score is one of the factors that insurance companies use to determine your premium. If you have a high credit score, you’re seen as less risk and will pay less for your car insurance.

RELATED ARTICLE: WHAT MAKES UP YOUR CREDIT SCORE?

To raise your credit score, you can:

Pay Your Bills on Time

This includes not only your car and mortgage payments but also your credit card bills, utility bills, and any other type of loan you might have. Set up automatic payments for all your bills, so you don’t accidentally miss a payment. Payment history accounts for 35% of your FICO score, so missing even one payment can significantly affect your score.

Keep Your Balances Low

This shows creditors that you’re not overextended and can manage your finances responsibly. When your credit card balances are close to or at their limit, it indicates that you’re using too much of your available credit, which can lower your score. If you’re unsure about your credit score, you can check for free on websites like Credit Karma. Once you know where you stand, you can work on improving your score and saving money on car insurance.

5. Drive Less

The less you drive, the lower your chances of being in an accident. Therefore, many insurance companies offer discounts to drivers who log fewer miles. If you work from home or take public transportation to work, tell your insurer and see if you qualify for a low-mileage discount.

You may also be able to get a telematics discount, which is based on the data collected by a device installed in your car. This device tracks how much you drive, when you drive, and other factors that can impact your risk of having an accident.

6. Consider Raising Your Car Insurance Deductible

The deductible is the amount you’ll pay out of pocket before your insurance company starts covering expenses. By raising your deductible, you can lower your monthly premium. Of course, this means that you’ll be responsible for a larger portion of any repairs or medical bills in the event of an accident.

However, if you have a good driving record and are comfortable taking on a little more risk, raising your deductible could be a wise financial decision. Set aside enough money if you need to make a claim. That way, you’ll be prepared no matter what happens on the road.

7. Drive Safely

The safer you drive, the lower your risk of having an accident. And the lower your risk, the lower your insurance rates will be. Distractions, fatigue, and other factors can increase your risk of being in an accident. To help keep yourself and others safe on the road:

Always drive with caution and be prepared for the unexpected.
Follow the speed limit, always use your turn signals, and keep your eyes on the road.
If you are tired or distracted, pull over to rest or wait until you can focus on the task.

If you do get into an accident or receive a ticket, compare rates with other insurers to see if you can find a better deal. Shop around for car insurance every year to ensure you’re still getting the best rate.

8. Pay Annually

You’ll usually save money if you can afford to pay your premium in one lump sum. Insurance companies typically offer a discount for customers who pay their premiums annually. It costs the insurer less to process one payment than to process twelve.

In addition, you won’t have to worry about missing a payment or being charged a late fee. If you can’t afford to pay your premium all at once, consider setting up automatic payments from your checking account. This way, you can ensure your bill is paid on time each month and take advantage of any discounts your insurer may offer.

Use These Tips to Save Money on Car Insurance

By following these tips, you can save money on your car insurance. Compare rates and coverage options before buying to ensure you get the best deal. Remember, the best way to save on car insurance is to be a safe driver. Drive carefully and always obey the law to keep your rates low.