What do you know about your auto insurance policy? Some car owners buy policies that give them full coverage at the expense of their budget.
A basic way to find out whether you are paying for the right policy is to set a strict budget. With a budget in mind, you can adapt your policy according to your needs.
According to a survey made by NerdWallet.com, 38% of motor vehicle owners haven’t even bothered to compare or even analyze their auto insurance rates in the past three years or more.
Not to mention that 17% of participants do not even check them at all. That result gives a rationale to the importance of lower premiums and research.
Of course, there are some place-dependent factors (weather, location, number of uninsured drivers) that are out of your control, but that doesn’t mean you have to accept whatever your insurer offers you.
For that reason, here are 5 tips to reduce your auto insurance rates.
#1 Set an annual payment
An effective way of taking care of your budget is to sign up for an annual payment on your auto insurance plan. Know that auto insurance companies reward customers who pay their policy upfront.
You’ll benefit from not handling monthly payments nor coping with late fees. More importantly, you are not subject to the monthly fluctuations that happen in the car insurance industry.
#2 Take your time shopping around
Take your time while looking for the best auto insurance rate. Believe it or not, auto insurance companies tend to charge their most loyal customers the highest rates.
They are really good at examining your buying habits. How likely are you to switch from one insurer to another? The more prone you are to switch to another auto insurance provider, the lower the auto insurance rates you could qualify to.
Don’t rely on insurers to help you save money. Take your risks and aim for the best quote.
#3 Increase your deductibles
An auto insurance deductible is the amount of money you have to pay towards car repairs before your insurers covers the rest.
If you sign up for a higher deductible, you’ll be handling lower monthly payments. Always ensure you can afford your deductible prior to making any decision.
#4 Get more than one type of insurance from the same provider
Sometimes car owners work with the same insurer to get other type of insurance policies, say homeowners insurance. This method allows them to qualify for lower auto insurance rates.
Additionally, if there are multiple drivers in your family, insurers could offer you a good price on your auto insurance.
#5 Work on your credit score
Paying your bills on time comes with extra benefits. Auto insurance companies reward customers who lower their credit balance because that reduces the risk of making a loss.
Make sure you check your credit balance on a monthly basis, as your credit score matters. Some people fail to notice some errors on their balance or even fell victim to fraudulent activity. Watch out!