How To Make Car Insurance More Affordable
When you're thinking about how to make your car insurance more affordable, the key factor to consider is the amount of risk you're asking the inusrer to take on. The greater their perceived risk, the more they're going to charge for coverage. While some of the factors auto insurers use to determine their degree of exposure are outside of your control (your age and/or gender for example), there are ways to make car insurance more affordable.
Maintain A High Credit Score: Unless you live in California, Hawaii, or Massachusetts (where the practice is banned) a number of insurance companies use "credit-based insurance scores" to help determine the level of risk a given policyholder presents. While not exactly the same as the credit score used to determine your suitability for a loan, many of the same factors are considered. If you have a high credit-based insurance score, an excellent driving history, and zero claims on your record, you'll typically qualify for lower rates.
Mutliple Coverage: If you place your homeowners or renter's insurance on the same policy as all of your motor vehicles, most insurers offer a discount.
Multiple Car Discount: Similarly, if you insure all of your vehicles on the same policy, you'll realize savings over insuring them on separate policies.
Clean Driving Record: People with clean driving records pay less for car insurance—period. Moving violations of any kind; and/or accidents resulting in insurance claims can drive the cost of your insurance premiums up.
Approved Driver Training: Defensive driving courses can reduce the price, regardless of your age. Check with your carrier to see which ones they recognize.
Teen Driver Discounts: Because of their relative lack of experience behind the wheel, teens usually cost more to insure. However, if you enroll your teen driver in a recognized driving school, and/or they get really good grades in school, some insurers will offer them coverage at a more favorable rate. Your young driver will be less likely to have an accident too.
Zip Code: Where you live definitely has a bearing on your insurance rates. On average, suburban dwellers have lower insurance premiums than people who live in cities. For insurers, the generally higher concentration of hazards in urban areas mean the likelihood of an incident is greater, so premiums are higher.
The Type Of Car: Yep,a high-flying performance car is going to cost more to insure than a slow and steady economy model. It goes back to the odds. Faster cars are considered more likely to encounter incidents.
Choice Of Coverage: If you’re driving a newer car, or a car with significant value, you’ll probably opt for full coverage. If you’re driving a car with limited value, you might be better off just going with liability insurance in case you hit somebody, trusting the other party’s liability coverage to repair or replace your ride if they hit you. You'll find an explanation of the various types of coverage in the "How To Buy Car Insurance" article.
Coverage Limits: The more adversity you ask an insurance company to protect you against, they more they’re going to charge you to do so. The highest coverage limits carry the highest premiums. Lower coverage limits carry lower premiums—but you also assume more risk.
Higher Deductibles: Speaking of risk, if you’re willing to take on more out-of-pocket responsibility for a repair, insurance companies will float you a discount for doing so. Most people opt for deductibles in the $500 range, but if you go $1000 or more, your car insurance policy will cost less.
Depending upon your insurer, there may be a number of other ways to make your car insurance more affordable. For example, some companies offer discounts to people who work in certain professions—or go to certain schools. Whenever you're considering going with an insurance company, always ask for a full list of the discounts they offer. You might well find you qualify for quite a few of which you were unaware.