When you buy a new car, you spend a great deal of time comparing the makes and models, and finding the best deals, whether you choose to buy your car outright or lease it. However, do you put the same amount of effort into insuring your new car? After all, it is a significant expense that you will need to pay every year.
Fortunately, there are plenty of ways to save money on your car insurance. Insurers take a range of factors into account when setting premiums. These include the level of coverage you want, where you live, how old you are, your driving history, and the make and model of the car that you are driving. Here, we share some top tips to help you get cheap car insurance.
Shop Around
When we buy appliances such as new televisions or washing machines, we tend to shop around and compare prices from different retailers, and you should do exactly the same when looking for car insurance. Get prices from a range of insurance companies before you commit to taking out a policy, as you may find some differences in the prices offered by them. All too often, we let our insurance auto-renew with the same insurance company we have always used, despite them not offering the best price or any discounts.
Take Advantage Of Discounts
Whether you have been driving for many years or you have just passed your test, car insurance companies can offer a range of discounts to help you save money. Some will be automatically applied when you submit an insurance quote, but in some cases, you may need to ask your insurance company or agent.
For example, bundle coverage is one way you may be entitled to a discount. If you are buying your homeowners' or renters' insurance from the same company, they may offer you a discount. The same applies to households with more than one driver - putting all vehicles and drivers on a multi-policy package can save you money.
Drive Safely
One of the quickest ways to drive up your car insurance premium is to have a poor driving history, with accidents and speeding tickets. These are automatic red flags to insurers because they are going to assume that you are a careless driver and are more likely to be involved in a car accident.
If you do get a ticket, and it is your first one, you may be eligible to take a driver's education course. By doing this, you may be allowed to keep the ticket off your driving record and save some money on your driving insurance.
Consider Your Location
Your insurance premium will be based on the zip code where you live. Some regions will have more claims than others, and so these areas are liable to pay higher rates to insure a vehicle. If you move to an area with a new zip code, make sure that you notify your insurance company right away, as you may find that your rates drop. Of course, if you move to a busier area or one with higher crime levels, you may find that your premium goes up.
Keep An Eye On Your Mileage
When you take out coverage, you have to estimate your annual mileage. Of course, no one can ever be entirely sure, but it is important to keep an eye on it and track how many miles you drive. If you change job, have a different commute, or something else happens that reduces the number of miles that you drive, you need to report it to your insurer. The fewer miles you drive, the lower the chances of you being involved in an accident, so drivers with low mileage generally costs less to insure than those who are commuting long distances every single day.
Some insurance companies offer discounts to drivers who drive very little. These are particularly useful for older people who may only drive a few miles each year.
Tell Your Insurance Company About Any Life Changes
Whenever you go through a life change, whether that is getting married or divorced, having children, or starting a new job, make sure you let your insurance company know, as these can change the price of your insurance premium. Of course, it can also increase it as well as decrease it! It is not just important for saving money - not informing your auto insurance company about certain life changes can make your policy void, and this can cause some big problems if you were involved in an accident.
Maintain A High Credit Score
Many people are not aware that their credit scores can play a big role in the price of their insurance premiums. Insurance providers can show a correlation between credit scores and claims, so they base their fees around credit scores.
You can keep your credit score looking healthy by paying all of your bills, including utilities, credit cards and loans, car payments, rent or mortgage, on time and in full every month. Missing payments or late payments will lower your credit score and increase your insurance costs.
Have A Higher Deductible
While many people are not keen on having an insurance policy with a high deductible, increasing it to the highest amount you feel comfortable with is an easy way to bring down car insurance costs. Car insurance is based on risk. If you are willing to take on more of the risk yourself with a higher deductible, the lower your car insurance costs.
However you need to know that you can afford to absorb those costs if you are in an accident. If you have a deductible of $1000, it means that you are liable for the first $1000 of any costs associated if you have an accident.
Choose Your Car Carefully
Most of us buy the car and then think about the insurance, but sometimes, we need to do it the other way around. Different cars cost different amounts to insure, depending on things like horsepower, safety, and the cost to repair. When buying a car, make sure you have looked at how much it will cost to insure it beforehand.
