Car insurance protects you, your car, passengers, and other drivers on the road. Many car owners believe that their auto insurance bill is set in stone. The truth is, there are ways you can reduce your auto insurance payments. Here are three little-known tips on saving on auto insurance.
Studies show that few drivers spend time shopping for insurance policies. Most of the drivers who compare quotes from different insurers switch to those with lower premiums. What many people do not know is that different insurance companies offer different rates for the same coverage.
Different insurance companies measure risk differently. Therefore, what one company considers high-risk may be a medium-risk with another company. Also, a past accident history may cost more with one company than with another. Some companies also disregard your credit history. Compare the charges of different insurance companies to find the one with lower rates.
Bundle Your Policies
Auto insurance companies offer discounts to clients that have more than one policy with their company. If you have a homeowners insurance or life insurance policy with a different company, ask your car insurance company how much savings you would make by bundling all the policies. You could save 5%–25% on all your policies.
However, even if your auto insurance company offers a bundle discount, you should not think that it is the best option in the market. Inquire what discounts their competitors are offering to determine whether you have got the best deal. Since new insurance companies are coming into the market, you should review your policy every few years to make sure it is the most affordable coverage available.
The deductible is the out-of-pocket payments you make before your insurance begins to pay. For example, if you were in an accident and the cost of repairs is $2,500 and your deductible is $500, you will pay this amount, and the insurance company will pay the remaining $2,000.
Many people go for low deductibles because they are anticipating huge bills after an auto accident. However, if you opt for a low deductible, your insurer will require you to pay high monthly rates to cover the risk of paying more for your car repairs. Raising your deductible will help you save on premiums. For example, if you raise your deductible to $1,000, you can manage to save 40% on premiums.
For more information, reach out to an auto insurance provider.
Purchasing insurance — the right insurance — is one of the smartest things you will ever do. While there are definitely differences between homeowners, car, life, and health insurance policies, they all serve the same purpose when it comes down to it. Insurance protects you against financial ruin should a tragedy happen in your life. In the case of homeowners insurance, that tragedy could be a fire or a flood. In the case of life insurance, that tragedy would be your death. The more you learn about insurance, the better the decisions you'll make when purchasing it. So dive into the articles here, and start reading.