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Some Suggested Tips to Lower Your Auto Insurance Costs
1. Prices vary from company to company, so it pays to shop
around. Get at least three price quotes.
2. You buy insurance to protect you financially and provide
peace of mind. It's important to pick a company that is
financially stable.
3. Don't shop price alone. Ask friends and relatives for their
recommendations. Contact your state insurance department to find
out whether they provide information on consumer complaints by
company.
4. Before you buy a new or used car, check into insurance
costs. Car insurance premiums are based in part on the car's
sticker price, the cost to repair it, its overall safety record,
and the likelihood of theft.
5. Establishing a solid credit history can cut your insurance
costs. Insurers are increasingly using credit information to
price auto insurance policies, check your quote. To protect your
credit standing, pay your bills on time, don't obtain more
credit than you need and keep your credit balances as low as
possible.
6. Companies offer discounts to policyholders who have not had
any accidents or moving violations for a number of years. You
may also get a discount if you take a defensive driving course.
If there is a young driver on the policy who is a good student,
has taken a drivers education course or is at a college out of
the area without a car, you may also qualify for a lower rate.
Here's some more..
1. Get an annual review to be sure you are getting all the
discounts you are entitled to with your current carrier,
including:
multiple vehicle insure your home with same carrier additional
safety features on vehicle (ABS, anti-theft system, etc) do you
need full coverage? If you vehicle is paid for, over a certain
age, is it costing you more to insure than just to replace?
increase your deductibles pay for small damages vs. using your
insurances to risk an increase in rates and lose certain
deductions
2. When shopping around for quotes, be wary of giving out SSNs,
your FICA score gets hit by 5 points for each inquiry. So ask
for a general quote, most reputable agents will do this.
3. If you don't own a home, get renters insurance! I cannot
stress this enough. It is cheap, like less than $10/month for
$100,000 of content coverage, and if your apt/house is in a
fire, you will be able to replace your stuff.
As a former insurance adjuster (15 years in the biz), here are
some more:
1. Don't lie on an application. This is about the worst thing
you can possibly do. If you lie, you'll get caught at some
point. You'll then be cancelled/declined, and that will follow
you around for years. You'll notice on each application, there
is a question something along the lines of, "Have you ever been
denied insurance or had a policy cancelled before?"
They'll check. They'll also pull your MVR (Motor Vehicle
Report). They'll also likely run a CARFAX on your vehicle to see
if it has been involved in any prior accidents.
2. Pick the highest deductible that you can afford. This is
difficult for many people to comprehend. Many times, people will
choose $500 or $1000 deductibles because it makes the premiums
very attractive. Unfortunately, when you get into an accident
(your fault or not), you then have to pony up the deductible
(unless the other carrier pays for your damage). As an adjuster,
one of the most common complaints that I'd hear is, "Well, I
don't have $1000 in the bank to repair the car. The accident
wasn't my fault. What are you going to do about it?"
Unfortunately, the answer typically is that the adjuster is not
going to do anything about it, aside from try to get your
deductible back from the responsible party, either by the
process of subrogation (one insurance company going after
another) or a lawsuit if the person is uninsured. Neither
guarantee success, and in most cases, the adjuster is going to
require that your vehicle be fixed prior to taking any action
against a responsible party because, if we do it beforehand and
the repairs cost more than the demanded amount, the insurance
company is out that additional money.
So, the rule of thumb is as follows: If you don't normally have
$1000 in the bank, then don't take the $1000 deductible. If you
really only have $500 or $250 in the bank at any one time,
choose that as your deductible amounts.
3. Know the value of your vehicle. Many people throw out
thousands of dollars per year on useless insurance. A good and
honest insurance agent will help you determine if you need
Comprehensive and Collision insurance. A less-than-good agent
(not necessarily dishonest, but let's leave it at inexperienced)
will write you up any coverage you want without asking
money-saving questions.
In the Internet-shopping environment, many times you don't deal
with sales agents to look out for you. Saying that, most people
have no realistic clue on the planet what their vehicle is
worth. Check your car.There are several great websites that, for
free, will help you assess the vehicle's value.
You have to be realistic when you use these websites,
particularly NADA and Kelly Blue Book (KBB). Read the
descriptions, particularly the "Vehicle Condition" descriptions
on the website. While you may think your vehicle is in
"excellent" condition, it is extremely likely that it isn't. KBB
will help you, if you need it, to accurately determine the
condition of your vehicle.
The above websites are what your own insurance company uses to
value your vehicle in the event it is a total loss. They'll also
likely use CCC Valuescope, which is not a free site. But, CCC
Valuescope relies on CARFAX and NADA to do a lot of the dirty
work for them.
Realize that mileage is one of the biggest factors in
determining the value of your vehicle. Higher mileage equals
lower value.
Compare the premium of the Collision and Comprehensive
insurances to the value of your vehicle, and don't forget to
take into account the deductible. If you're carrying a $500
deductible on a $1500 vehicle, you're throwing out money. All
you need is liability insurance, along with whatever uninsured
motorist protection and medical coverages you need. You don't
need to be wasting your money on Comp and Collision.
Finally, the whole depreciation issue comes to bear.
Depreciation is best defined as Replacement Cost (what it would
cost you to purchase something new at today's price) less any
Betterment (any wear/tear that is associated with the use of the
product). Let's take tires for an example. If a new tire costs
$100 (Replacement Cost), and has a 100,000 mile useful life (not
realistic, and warranty is a seperate issue), and you've put
25,000 miles on the tire (betterment), then the depreciated
value of the tire is $75. That's all you're going to get from
anyone, unless you have a Replacement Cost policy
(extraordinarily rare).
Paint, any moving parts, rubber, carpeting, leather, vinyl,
lights, etc. all wear out and thus, are depreciated. Most
insurance companies won't depreciate paint if only a panel or
two is damaged on your vehicle. But, if the entire car requires
repainting, you're going to suffer a depreciated payment on top
of the deductible that you've already incurred. So, you need to
keep depreciation in mind when you're considering a deductible.
To recap, a $500 deductible might wind up being more than that
when depreciation is factored into the mix. Sometimes, with
engines for instance, the depreciation can be several thousands
of dollars.
Learn more about insurance quote: www.insurance-quote-free.com
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