•  

How to save money on your auto insurance

Date: Nov 28 2010
Filed In: Auto Insurance101

If you’re looking to save money, a great place to start is with your biggest expenses first. For millions of Americans that mean taking a little closer look at your car and how much you’re paying to insure that car.

Here is five simple steps to lower your auto insurance bill

  1. Pay all your bills on time in order to keep your credit score up.
  2. Raise your deductible. If you raise your deductible from $200-$500, you can see your premium can drop as much as 15% to 30%. If you raise your deductible from $200-$1000, you can see your premium drop as much as 40%.

    The key on how much deductible is right for you is how much cash you have for that emergency fund in case something goes wrong.

    If you raise your deductible to $1000 that means you will have to pay $1000 to the auto insurance company before your insurance kicks in and the math is that 40% deduction will give you enough cash coming in to save up for that $1000.

    Psychologically it feels better if you got into accident and you would only have to pay $200. It’s not math issue because mathematically if you add each month how much you would save in the premium. It would exceed the typical deductible amount of $1000 and that’s the whole point of raising deductible.

    The flipside is that you don’t spend that money you’re saving on the lower premium which is sometime what happened and that is when people get into problems and can’t pay for the deductible.

  3. Ask your auto insurance provider if you are eligible for any discounts. We hear this all the time on TV ads but how much does it really save you money?

    Surprisingly you can save 10% to 15% is not abnormal. If you are a good driver with no speeding tickets, you’re married, and if you have multiple policy at the same carrier. Often times you can see 10% to 15% discounts.

    These are some the things they would not offer to you and you would have to ask for it.

  4. Don’t text or talk and drive. If you have an accident due to distracted driving, you will have a hard time renewing your auto insurance policy.

    What is more interesting now is that it cost more to insure teenage girls then teenage boys because texting while driving has exceeded testosterone and driving fast.

    This tells you a lot about how serious texting while driving really is.

  5. Shop around. Auto insurance premium can vary significantly from one carrier to another.

    A lot of times people say it is such a pain in the neck to do this but ironically is not that difficult. There are two great websites www.insurance.com and www.insweb.com are great websites to do this. You can go there to the websites or you can call a couple of insurance carriers and for 15 minutes you can literally save yourself $1000 or more on your auto insurance depending on your adjustments.

Honestly, the amount of insurance varies depending on your age, your sex, location, and the distance of driving per day, and so on. So you’re cost of insurance will depend on that but the reasonable amount to spend on auto insurance is around $1000 per year per car.

When we say around it means it vary dramatically in different cities. If you live in certain cities, rates could be higher than other cities because of different traffic conditions.

So about $1000 per year per car, for expensive car it could be around $1200-$1300 per year and for older less expensive car it could be under $700-$800 per year.

Related Articles:


Share |

Write a Comment