Shop around.
One of your first steps should be to shop around.
A particularly good time to investigate your
alternatives is when your current policy is about
to be up for renewal, especially if you find that
your premium has gone up. You may be surprised to
learn that auto insurance premiums for the exact
same coverage on the same car can vary widely (by
hundreds of dollars) between different insurers,
even in states that regulate auto insurance rates.
Increase your deductible.
For many people, raising the deductible on their
auto insurance is a good way to cut the cost of
the policy. Sometimes you can reduce your annual
premium by 10 percent or more if you increase your
deductible from, say, $250 to $500. If you do
this, however, make sure you have the financial
resources to handle the larger deductible when the
time comes.
Keep an eye on your credit report.
Your credit history is an important factor for
most auto insurance companies. Many studies have
shown a correlation between your credit history
and the risk to an insurance company. Paying your
bills on time and maintaining a good credit
history will allow you to enjoy lower auto
insurance rates.
Drive less.
If you drive less than a certain number of miles
in a year (e.g., 7,500), you may qualify for a
low-mileage discount. If your insurer offers this
discount, try to limit your driving as much as
possible. If you commute to work, use public
transportation instead of driving. When you go
away on vacation, fly or take the train.
Don't use your car for business purposes.
Since work-related driving generally subjects you
to higher premiums than pleasure driving, it may
be in your best interest to stop using your car
for business purposes.
Drive more safely.
You may be eligible for a price break on your
policy if you maintain a clean driving record for
a specified period (usually three years). A clean
driving record generally means no accidents,
moving violations, drunk driving convictions,
etc., during that period. The best way to qualify
for the applicable discount is to drive carefully
and defensively at all times.
Buy a low-profile car.
Cars are rated on a risk scale for auto insurance
purposes. In general, sports cars and other
high-performance, flashy vehicles are classified
as higher risks because they are common targets
for thieves and vandals, and because
statistically, the people who own them tend to
drive more recklessly. If you own such a vehicle,
you will likely pay a higher premium than if you
owned a station wagon, sedan, or other low-risk
vehicle.
Move.
If you live in a rural community with little crime
and traffic congestion, your premium will
generally be lower than if you live in an urban
area where your car is more likely to be stolen,
vandalized, or involved in an accident. Granted,
you shouldn't move just to cut your auto insurance
costs. However, this may be one of many factors in
your decision if you're thinking about relocating
from the country to the city.
Keep your car in a garage.
Cars parked in garages are less likely to be
stolen, vandalized, or struck by other vehicles.
Using a garage to store your car may entitle you
to a slight premium reduction.
Have safety/anti-theft devices installed.
You may receive discounts on your insurance if
your car is equipped with one or more of the
following options: anti-lock brakes, automatic
seat belts, and airbags. Similarly, anti-theft
devices such as car alarms and tracking systems
(e.g., Lojack) may also get you a discount because
they reduce the chances of your car being stolen
or vandalized.
Inquire about multifamily/multi policy
discounts.
You may receive a discount from your insurance
company if you buy more than one type of insurance
through that same company (e.g., auto and
homeowner's). A discount may also apply to your
auto insurance if you insure multiple cars under
the same policy or with the same company.
Other discounts
Other discounts may be available if you meet
certain criteria. Examples may include discounts
for taking a defensive driving course, being a AAA
member or staying with the same auto insurance
company for a number of years. These discounts
vary by company.
