If you own a car, you really should have car insurance. Yeah, it’s an extra expense, but you’ll be happy you have insurance when you get into an accident. That doesn’t mean you need to spend an excessive amount on it though.
To save money on car insurance you need to know what affects your rates. To help you save money relatively quickly, here are 5 different ways to get discounts on car insurance.
Get Usage-Based Insurance
If you don’t drive a whole lot, see if you can go with a company that offers a usage-based driving program. The rates for these types of policies area based on how much you actually drive or even how well you drive. These companies will ask you to install a tiny device in your car and it’ll transmit data to your insurance company.
That means the less you drive, the cheaper your insurance rates will be. Esurance and MetroMile are two companies that offer pay-per-mile insurance. They’re not in every state, so you’ll have to check if you can take advantage of this in your state.
Get a Cheaper Car
If you can, change the car you’re driving (but don’t do so if it’ll cost you too much money!). Go ahead and check the your current insurance provider to see if different vehicle models will affect rates. Really, the car you drive will affect your premium, especially if you choose to purchase comprehensive coverage. In general, flashy cars (like sports cars) are more expensive to insure than more “safe” vehicles like mini SUVs and sedans.
Don’t Pay For Insurance You Don’t Need
Have you really looked at exactly what you’re paying for? If you haven’t, how do you know that what you’re currently paying for something you absolutely need?
Comb through your current insurance policy and see if you actually need any of what you’re paying for. For example, if you have an old car, it might not be worth it to keep paying for comprehensive insurance (it pays for damages to your vehicle). If you have collision premiums, paying for it if you have an older car might not make sense. If replacing your car is cheaper than making major repairs, then you might want to consider dropping collision insurance.
A quick calculation you can make is to see if your car is currently worth more than you deductible plus what you pay for annual coverage. If it isn’t then consider dropping excess coverage. Usually, collision and comprehensive coverage usually doesn’t pay more than what the car is worth.
Find Car Insurance Discounts
Ok, this one is pretty obvious, but call your current insurance company to see if you can save right now. Ask if there are any discounts you’re automatically entitled to or even ask to see if there are any current promos you can take advantage of.
For example, if you bundle insurance policies, you typically get a discount. If your household has more than one car, that also qualifies for a discount as well. Have a child in the family? Enroll your teenage in driver training classes and your premiums will most likely drop.
Using one or even all of the above methods will definitely help you lower your insurance rates relatively quickly. You can then take the money you save towards other things, like a new car or even to go on the vacation of your dreams.