While there is plenty of criticism of car insurers using a person’s credit score to determine cost, the fact is that it exists. Maintaining a good credit score will help you score lower rates for your auto insurance. You should also ask a company you are prospecting to disclose how your credit score is affecting your car insurance rate.
While insurance is meant to provide you financial protection when accidents occur, you may want to consider taking a higher deductible to lower your premium. You may pay more if you are involved in an accident but you also pay less when you are not. The car insurance industry estimates the average driver will be involved in a crash only every 17 years.
When you buy a new car, most creditors require that you have full coverage but once you have paid off the loan, this is no longer necessary. While being prepared for accident repairs or even a total loss of your vehicle is important, remember that a vehicle loses value every year. Having full coverage on an older one may be costing you more than it’s worth.
Getting coverage for every possible thing that can happen might be tempting to some but the fact is, you probably don’t need it. You cannot predict what hazards you may come across on your daily drive or while your car is parked, but you cannot let this drive your decision to pay more when you may not need more.
A few good insurance companies do reward you with a substantial discount for staying with them but assuming that your insurer does this could be a big mistake. Many car insurance providers offer no loyalty discount at all and some even charge their long-term customers more. Loyalty penalties do actually exist.
“Bundle and Save” is the slogan many car insurance companies tout but the savings are generally insignificant. If you do bundle, focus on the type of coverage you are getting for each item and the convenience of having one company for auto, home and more. Banking on bundle savings will likely leave you disappointed.