July 29, 2011

4 Ways To Immediately Pay Less For Car Insurance

There are several ways to save on car insurance, some obvious and others that take a little research to learn. Insurance premiums are calculated using a number of factors, including age, gender, type of vehicle, driving record, home address, how many miles are driven annually, etc. Some of these facts are unchangeable and affect how much an auto insurance policy will cost. But there are at least four ways to immediately begin paying less for car insurance.

The first and most obvious is cutting back on the coverage in the policy and raising the deductible. Is it an older car? If the car is worth less than 10 times the premium, chances are the coverage is not cost effective. Maybe full coverage is no longer needed; it might cost more to pay a deductible on the car than it is worth. And when the deductible is raised, e.g. from $250 to $1000, the premiums could decrease as much as 40 percent. Consider these important factors when discussing with an agent how much coverage is desired and how much the deductible should be in the event of an accident.

Secondly, just like anything else, buying in bulk can usually save a bundle. Check to see if adding a homeowner's policy to the auto coverage and any other property that needs insurance will lower the policy premium for the car insurance. When an insurance agency holds multiple policies for the same person, there can be big discounts given. If they also sell life insurance, see if transferring a policy or opening a new one will also get the premiums lowered.

Next, just as group health insurance plans save the insured money, so can a group auto insurance plan. Some companies offer discounts to customers who get insurance through a group plan, membership association or other professional organizations. Some employers have a group auto insurance plan their employees can be added to as well. Drivers might already belong to a group or organization that offers a discount and not even know it.

Lastly, there are discounts to be found in when and how payments are made. Find out how much can be saved by paying the annual or bi-annual insurance premiums in full. Some companies will give a discount for paying the premium up front, or a monthly service charge is avoided when it is paid in full. In addition to paying it up front, when an autopay program is implemented, it can save a few dollars every month. See if automatically making payments by using a checking account or credit card can lower the premium. Keep digging for discounts since insurance agents don't usually offer them freely!