10 Tips to Getting the Best Deal on Car Insurance
We need it, we must
have it, but we don’t love searching for the best car insurance. It can be a
true pain in the neck getting quotes from insurance company after insurance
company. A ton of questions, applications, and even credit checks to just get a
disappointingly high rate quoted to you. There’s got to be a better way to get
the coverage and features that will make you feel satisfied at the end of the day.
Well there is a better way; begin your insurance search with the knowledge and
tools that will open the door to the lowest quote you can receive.
There are several
factors insurance companies look at to determine your insurance premium.
Following are some the factors they consider:
Record – Driving violations and accidents will raise your risk as a driver and
increase your insurance costs. Depending on your state, violations and accidents
will stay on your driving record for a certain number of years before being
you live – Insurance companies look at the area you live in and whether it is
rural or in a city. Cities have more claims made and are considered a higher
& Age – Whether you are a male or female does matter; men have more
accidents than women and by simply being a man your rate will raise. In
addition, certain age groups (normally those under 25) have more accidents and
are considered more of a risk than others.
Status – Single drivers are considered a higher risk than married drivers and
receive higher quotes.
of Vehicle – The make, model and year help determine the rate for multiple
reasons. Newer cars tend to cost more than older cars, unless it is a rare or
antique car. It is all based on how much it would ultimately cost to either
repair or replace the vehicle. In addition, sports cars will cost more to
insure than a mini-van due to the perceived safety of the vehicle model.
Insurance Coverage – Insurance companies consider your prior coverage when
quoting. If you allowed your prior coverage to lapse they increase your quote.
Use – It makes a difference to insurance companies whether you use your vehicle
for business or personal use. Business use, including driving back and forth to
work or school, results in a higher rate quote.
There are many
different ways to get the best rates in the automobile insurance hunt. Don’t
get frustrated if you get a couple of high quotes, each company is different
and there is sure to be a company that will give you a decent rate if you
follow these tips:
1. Shop Around
When shopping for
coverage don’t just settle for the first quote you receive, or even the second
or third. Getting a recommendation from a friend or family member is great, but
just because they receive a good rate from a company doesn’t necessarily mean
you will too. Because insurance company rates differ greatly from company to
company, you could end up paying a lot more if you don’t take the time to
There are many websites
that offer comparisons of online quotes. They will show you several different
insurance quotes based upon the information you provide. This can be quite
helpful by comparing the rates of many insurance companies. But be aware that
these sites may be fueled by promotional purposes and may not include the
lowest rates due to not being in business with all the available insurance
companies. It’s a good idea to do your own research as to who the insurance
companies are that are licensed to do business in your state and area.
A good tool to get an
idea of the lowest priced insurance carriers is to check the National Association of
Insurance Commissioners. Their site offers a map that connects
you to each state’s Department of Insurance websites. The Dept. of Insurance
websites will offer a comparison of rates from that state’s insurance carriers.
In addition, any complaints or violations will be logged by the state and will
be publicly listed.
2. Check for Discounts
These days, the
majority of insurance companies, and most certainly the large ones, offer
driver discounts. These discounts can make the difference when you choose you
carrier, and can save you a lot of money. The following are some of the
discounts that Insurance companies offer:
of affinity groups
and safety equipment
safety or driving courses taken
One of the most popular
discounts that most major insurance companies give is an on-time payment
discount. Make sure to make all your installment payments on time if you pay in
installments. You will notice that some companies also offer a discount if you pay
the whole policy premium in one payment as well.
3. Choose The Deductible
When choosing your
options for your car insurance you will be able to choose how high, or low,
your deductible will be. Typically, deductibles start as low as $250 and can go
as high as a couple of thousand dollars. Remember, this will be the amount you
pay when you need repairs on your vehicles, so pick an amount you can afford if
there is a need.
The lower your
deductible, the higher your insurance premium will be however, if you raise the
deductible you can lower your premium. A study done by Nerd Wallet
showed that increasing your deductible from $250 to $1000 can cut your premium
by as much as 40%. But, if you do so, it is a good idea to set aside some
savings to be able to cover the higher deductible in case of an accident.
4. Monitor your Credit Score
Many large insurance
companies factor your credit score into your rate premium. Not all states allow
this practice, but most do, so it’s a good idea to maintain your credit score.
A bad score can raise your premium by as much as 50%. You will notice that
insurance applications ask you to rate your credit score, but if they don’t
check your score right then, they may raise your rate with your first bill to
adjust for incorrect application information.
Work on repairing your
credit if you have bad or fair credit. It is reported that if you raise your credit
score by at least one tier you may save up to 17% off your
annual premium. You are entitled to a free credit report every year.
5. Bundle your Services
There are many
companies that offer several different products, such: Life Insurance, Renters
Insurance, or Home Owner’s Insurance. These companies will offer a “bundle” or
“package” deal if you use their company to insure multiple products.
Huge companies like Progressive and GEICO have
fantastic bundle packages for a whole range of products from Home Insurance to
ATV and Renter’s insurance. These bundles will give a package discount for
combining several of their products together. You can save an average of $110
if you bundle with home insurance or about $72 a year if you bundle with
6. Lower Coverages
Insurance is required
in all states, but each state has their own minimum coverage requirements. Make
sure and check what your state insurance requirements are. Many states only
require what is called “liability” coverage. Liability
coverage will, in the case of an accident you cause, cover the
opposite party’s expenses. All injuries, repairs and costs for yourself,
however, will not be covered. This ensures that accident victim’s expenses and
medical needs will be covered.
You may have collision
coverage as well. This type of coverage will include liability as
well, but also covers the cost of repairing your own vehicle as well. Another
level of coverage you may have is called comprehensive
coverage. This coverage includes liability, and collision, but also
covers loss due to weather, vandalism, animal accidents and theft. You will
most probably be able to adjust the amounts of coverage and deductible as well.
There are companies that also offer add-on services, such as: towing, lodging, rental
car, etc. for additional costs. Double check your policy, if you do have these
then you can opt out of these services and save some money as well.
So, if your coverage
includes not only liability, but also collision and/or comprehensive, then you
may consider lowering your coverage. This is a good way to lower your rate,
especially if you have an older car. A good rule to follow is if your car is worth
less than ten times your insurance premium, having collision/comprehensive
isn’t worth it. But if you are still paying on your vehicle be aware that most
loan companies require you to have collision while still paying on the loan.
Several major insurance
companies offer new programs that track your driving and give discounts based on
several factors. Progressive’s Snapshot program is one of the most well-known
of these programs. Typically, the company will send you a small plug-in device
to install in your car. This device automatically transmits your usage to your
There are also
pay-per-mile insurance programs, like Metro
that offers coverage if you drive less than 10,000 miles per year. This type of
coverage isn’t available in every state though. Currently it’s available in
only seven states (California, Illinois, New Jersey, Oregon, Pennsylvania
Virginia and Washington). The company uses a plug-in device that plugs into
your car’s OBD-II
to monitor the car’s mileage.
Another company, Esurance Pay Per Mile, is
only available in Oregon. This insurance coverage is available for those who
drive less than 10,000 per year. There is a base cost for the policy and then
an added cost per mile (generally a few cents). The company sends a plug-in
unit to be plugged into your OBD-II port.
8. Don’t pay in Installments
When you receive an
insurance quote and get ready to purchase, you will notice that they will give
you several options. These options may be a choice to pay the premium in one
payment, two payments, or installments. Many people may not have the money to
pay for the whole year and installments just make it easier. Unfortunately,
while it’s easier to pay smaller amounts it can end up costing you more in the
companies charge a transaction fee per installment payment. Fees vary, but can
add up. If you are able to pay the total premium in one or two payments the
more money you will save. On average, you can save about $62 per year.
9. Avoid Lapses in Coverage
On auto insurance
applications you will notice they will ask you if you currently have insurance,
and with what company. If you don’t currently have insurance coverage, they may
ask you how long you haven’t had it. This information is used to determine risk
and will factor into your rate quote.
It is best to not allow
your coverage lapse, as lapses in coverage will raise your premium. Some
insurance company rates can drop by about 7% after one year of continuous coverage.
If you decide to change insurance companies, make sure not to cancel your
coverage until your new coverage begins. It is said that if you start shopping
for insurance a couple weeks before you cancel your current insurance you will
save money on your new quote.
10. Check rates when
purchasing a new vehicle
In the excitement of
getting your new dream car it’s not any fun to worry about insurance costs, but
it’s a practice that can save you money. Newer, more expensive cars will cost
more in insurance, as they are more expensive to repair or replace. Insurance
companies will also raise the rate if the car is a popular car amongst car
thieves. For example, SUVs tend to have high theft rates, driving their
insurance premiums up, while having a vehicle with built-in anti-theft features
can reduce your premium.
It’s also important to
consider the safety of the vehicle you are considering. Insurance companies
take into consideration national injury statistics for vehicles. The Highway Loss Data Institute(HLDI)
releases information regarding injury claims per vehicle type. The HLDI reports
that the lowest amount of injury claims is from larger vehicles.
We, at Eden Autos, hope
these 10 tips help you better navigate through the grueling process of getting
the best insurance rates for your vehicle. If we can help you in any way with
this, or any other vehicle matter, please don’t hesitate to give us a call, or
simply drop by any time. Our vehicle inventory is
quite extensive, and our friendly staff will gladly help you find the car or
truck that meets your needs and financing budget.