Thinking about car insurance isn't high on most people's list of fun things to do. But what if you save more money by spending an hour or two learning some trade secrets? You won't get that from another two hours of reality television.
Here are some insider tips that may help drop your car insurance premiums:
1. Choose a high deductible. Companies appreciate customers who take on more risk. Not everybody is willing to have a $3,000 or $5,000 deducible. However, statistically speaking, you will be a better customer than those who have $500 deductibles. Your insurance company might not have to issue a claim for smaller damage. You agree to handle it yourself.
2. Consider whether to make a claim or not. Assuming you choose a high deductive, this will be easy. But even a $200 repair will likely be worth making out of pocket. Insurance companies often look at your past claim history to determine your rates. The more frequent you make claims, the more your car insurance costs. Remember insurance is a safeguard to protect you when something goes wrong, such as when you get rear ended and need thousands of dollars of repairs. It's not an investment. Companies will reward you with lower rates when you show that you don't cost them much money. It's probably not worth it to make a claim on the scratches left by the neighbor’s kids when you can fix it for $100.
3. Bundle your auto and home insurance. It's easier to keep a client than to get a new one. Auto insurance companies will often give you a discount for giving them the extra business. You might also get benefits for referring new clients, as well.
4. Raise your credit score. Easier said than done, but important nonetheless. Paying your bills on time and paying off debt, especially old debt can help increase your score. These are key factors in your credit score. Insurance companies use your credit score to gauge how much of a risk you will be. It's not foolproof, but it's an industry standard.
5. Pay annually. While you won't see a huge drop in the price when you pay once a year, it might drop by several dollars or more. Companies frequently reward customers who pay their full premium up front. This is because they won't have to rely on you to make a monthly payment. To make it easier on your bank account, set aside 1/12 of the total amount every month. Come next year, you'll make your payment painlessly.
Remember, every little bit of savings adds up. To save money on auto insurance, look for a company that offers these or similar policies.