July 25, 2017

Are-You-Paying-Too-Much-on-Auto-Insurance

Before you buy a new car, it is always a good idea to get in touch with your insurance company.  This way you not only get an idea of what your minimum requirements will be, but also the type of insurance policy that will be applicable to your circumstances and specific vehicle.

In the current auto insurance market, many consumers are unaware of the discounts that they qualify for.  And insurers, who make their money from premiums, won’t tell you if you don’t ask.

Without discussing your options with your insurance carrier, you may continue overpaying on your insurance policy.

Here are some tips to keep in mind when considering your auto insurance policy.

1. Avoid Unnecessary Cover

You should definitely not insure an old car like a new one. If you have an older model car, it may not actually be worth it to have collision and/or comprehensive cover.  However, until the car is paid off, a lender will require that you carry comprehensive and collision coverage. It’s extremely important to discuss your options with an insurer so that you avoid a situation where your deductibles actually exceed the value of your vehicle. Your insurance should never cost more than the actual payout you would receive in the event of a claim.

2. Low-Mileage Discounts

Do you use your car to drive to the shop, work, or other short trips? If you have managed to maintain low-milage in your vehicle, you may be eligible for a discount on your insurance policy. This type of discount will only be applicable if you have done less than 15,000 miles per year, but you will have to talk to your insurance carrier to figure out if you qualify for this type of discount.

3. Vehicle Specific Discounts

Some vehicles demand higher premiums than others. Insurance companies will look at factors such as how often a particular model might be stolen, targeted by radar, or even pulled over. These “high profile” vehicles will inevitably cost more to insure. On the other hand, vehicles fitted with airbags, anti-lock brakes, automated seat belts and other safety features will demand lower premiums.

4. Higher Deductibles Allow Lower Premiums

Increasing your deductible will allow you to pay lower premiums on your car insurance. However, this is not a good idea if you do not have some emergency savings to tap into once you actually need to make a claim. By increasing your deductibles, you could lower your car insurance premiums by as much as 40%. But always keep in mind, only opt for higher deductibles if you can actually afford it, or you may end up in financial dire straits.

5. Unblemished Driving Record

If you have a clean driving record, you could qualify for a discount on your insurance premiums. This means that you should have no violations, speeding tickets, accidents, or DUIs to your name. Essentially, this is a discount for good behavior.  For completing a defensive driving course, you could also lower your auto insurance rates.

6. Membership Discounts

Being a member of specific organizations could also allow you to qualify for discounted rates on your car insurance premiums. These may include certain credit unions, AAA, alumni, certain banks, schools, and even certain companies also have this type of benefit. It’s always a good idea to check with your insurer what other discounts you may qualify for that you were previously unaware of.

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