1. Shop around. The price you pay for car insurance can vary by hundreds of dollars from company to company, so Rule One is to shop around.
As you know, insurance companies sell policies different ways. Some sell through their own agents. These agencies have the same name as the insurance company. Some sell through independent agents who offer policies from several different insurance companies. Others do not use agents and sell directly to consumers over the phone or online. Pick the type of professional arrangement that suits your needs and comfort level.
Your final selection should be based on price, coverage and your overall comfort level with the company or person who will be providing the auto insurance for you. Remember, you will be contacting them during a crisis, such as an accident or a stolen vehicle, so you want to be sure you’re happy with the level of support they offer.
2. Consider insurance costs when you buy a car. It costs more to insure your Corvette, Lamborghini or Farrari than it does to insure my Chevy Cobalt. That is because car insurance premiums are based in part on the car’s price, the cost to repair it, its overall safety record and the likelihood of theft.
3. Elect higher deductibles. Higher deductibles for collision and comprehensive coverages can lower your insurance costs substantially. For example, increasing your deductible from $200 to $500 could reduce your collision and comprehensive coverage cost by 15 to 30 percent. Going to a $1,000 deductible can save you 40 percent or more. Obviously, you should not choose a deductible that you will not be able to pay if you have an accident.
4. Consider dropping collision and/or comprehensive coverages on older cars. If your car is worth less than 10 times the premium, purchasing the coverage may not be cost effective.
5. Buy your homeowners and car insurance coverages from the same company. Many insurers will give you a multi-policy discount if you buy two or more types of insurance. You may also get a reduction if you have more than one vehicle insured with the same company.
6. Keep your credit score up. Most insurers use credit information to price their car insurance policies.
7. See if you qualify for a low mileage discount. . Some companies offer discounts to motorists who drive a lower than average number of miles per year. Low mileage discounts can also apply to drivers who car pool to work.
8. Other common discounts. Many car insurance companies offer discounts if your young driver has good grades, has had a driver’s ed or defensive driving course or is away at college and not driving. You may also get a discount if you have had no moving violations or accidents in 3 years, or if your car has a anti-theft device.
**This article is designed to provide helpful information that can be read within 2 minutes. It is neither a full explanation of this subject nor legal advice. To learn more, and to receive legal advice on which you can rely, contact me or another lawyer.