Car insurance can take a significant chunk out of your budget, but you can still get great coverage at lower rates. Shopping smart, having a good idea of what fits your needs and taking advantage of available discounts are all wise strategies. Use these tips to find a policy that protects you without breaking the bank.
Owned, Leased or Financed?
While shopping for an auto policy, remember that you’ll need to carry comprehensive and collision along with standard liability if you’re still paying lease or finance payments. Collision handles damages from automobile accidents, while comprehensive deals with claims related to vandalism, theft, weather, water or other non-accident causes. Because the bank or leasing agency owns your automobile until the loan or lease period is complete, it wants to ensure its interests are secure. However, Investopedia advises that you may be able to skip out on comp and collision if you’ve paid off your vehicle, especially if it’s blue book value is below $5,000.
Sensible Deductible Strategies
Consumer Reports discusses a few hints for selecting a wise deductible amount for your policy. Since this is what you’ll pay before your coverage kicks in, it reduces the money that your insurance reimburses for your claims. That’s because you’re choosing to take on a little more financial responsibility for repairs, with the reward being lower premiums. However, it’s wise not to set the deductible too high, as this could make it more difficult to get your vehicle fixed. Use your driving record as a barometer. If you’ve been accident-free, choosing a larger deductible is probably a safe bet.
Dip Into the Discounts
If you’re renewing your current policy or opt to purchase a new one, your local insurance agent should ask you certain questions to ensure you’re matched up with some potentially money-saving perks. Most companies offer a wide range of discounts, but it doesn’t hurt to ask your agent about these common offerings:
- “Good student” discounts for earning a “B” average or higher or maintaining honor roll status
- Completing a defensive driver’s training course
- Membership in alumni or professional associations
- Discounts for your vehicle’s anti-theft and safety features
Even if you don’t qualify for any of these cost slashers, a multipolicy bundle is sure to be a money saver across the board. Usually, you can combine auto with either homeowner’s, renter’s or life insurance to pay a little less money for both. Multi-vehicle specials may also be available to give you even greater savings all around.
What About Your Teenage Drivers?
Your rates will likely be higher if you have teenage drivers in your household. A 2013 Bankrate article explains that premiums tend to increase by 50 percent if you have underaged motorists on your policy. Nevertheless, you’re not without solutions to avoid paying more than necessary for auto insurance. It’s wise to insist that they complete a safe driver’s training course and take advantage of the good student discounts mentioned earlier. Allowing your kids to drive an older vehicle could drop your premiums, but keep in mind that newer year automobiles come with safety features that older versions lack.
Shop Smart to Buy Smart
It’s prudent to understand your possible options before shopping for auto insurance. Your first step is to know the terminology behind common indemnity protection products, such as the difference between liability, comprehensive and collision. It’s also important to keep a balance between affordable premiums and keeping your deductible easily within reach, to balance cost effectiveness while ensure repairs are affordable. Furthermore, taking advantage of available discounts can cut back your insurance expenses even more. Finally, don’t forget to adopt money-saving measures to offset the extra you’ll pay for the teen drivers under your roof.
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