You know the old saying, “you get what you pay for?” Well, that doesn’t really apply to buying car insurance. Paying more for your coverage can mean you are getting a good, full-coverage policy, but it can also mean you are over-insured or over-paying. On the flip side, finding cheap car insurance doesn’t necessarily mean that you are getting a sub-par policy, or that you’re going to have to deal with poor customer service.
Instead of the typical auto insurance article design to talk up the benefits of a particular company, here are few informational resources and 6 ways to find cheap car insurance without sacrificing coverage, customer service, claims processing, or anything important to picking a quality carrier.
1. Buying A Car
When buying a car, think about how much it will cost to insure the vehicle before purchasing, not after. Many consumers only take the sticker price into consideration, forgetting the recurring fuel, maintenance, insurance, and repair costs that will burden them for years to come.
As obvious as it is, some consumers need to be reminded – luxury and sports cars are more expensive to insure compared to safe, economical vehicles. A simple rule of thumb to think about is, if your vehicle registers 0-60 times less than 6 seconds, you’re likely going to pay a higher rate because that’s a fast car!
The next step to consider in the car buying process is ensuring your vehicle comes with safety features, such as anti-lock brakes, traction control systems, daytime running lights, air bags, alarm or anti-theft system, etc. If your car is highly rated in safety crashes, you will qualify for discounts.
2. Buy All Your Insurance From One Company
If you plan on buying homeowners, RV, motorcycle, or even life insurance, check with your auto insurance company first to see if you qualify for a bundle discount that could save you up to 15% with some providers. Similarly, if all the drivers in your household are insured under the same policy, you qualify as well.
However, unless the price, perks and discounts justify it, you shouldn’t feel the need to be a loyal customer to one carrier. Do what’s best for your family and finances, and if the company wants your business bad enough, they will match the cheaper premiums of a rival provider.
3. Comparison Shop
Whenever you are planning on making a big purchase, you should always compare prices with various companies. If you were buying a car, you wouldn’t make your purchase from the first lot you stepped on; the same should apply when purchasing car insurance.
First, you must start with some basic research. For example, there is plenty of data on average car insurance rates by state. If you are paying well-above your state’s average, then you definitely need to shop around.
Nevertheless, paying less than the average for you state can still mean you are overpaying for your city or zip code, especially in large states such as New York, California, and Texas. This is where a breakdown of premiums, including lowest, average, and highest rates can help you determine how less you should expect to pay.
After determining where you stand in comparison, review your policy for excess coverage. This will be discussed further in the tips below.
Finally, you need to get quotes from at least three separate insurance companies in your state, preferably from the largest ones with the best ratings. Customer service should be a top priority when choosing your carrier. After all, the last thing you need to deal with after an accident is a provider who doesn’t seem to care about your situation.
Ultimately, the best carrier is going to be the company with strong policy options, low prices, high customer satisfaction, and a reputation for honest, fair claims processing.
4. Drive Less
The less you drive, the less likely it is that you will have an accident. If you don’t drive as much as the average person, or if you carpool regularly, you might be eligible for a “Low Mileage” discount. Talk to your insurance carrier to see if you qualify for this discount.
5. Increase Your Deductible
If you have a larger deductible, you’ll have to pay more should you have an accident, but your monthly or bi-annual premiums will decrease. Because higher deductibles require higher out-of-pocket expenses for drivers, statistically speaking, insurance companies can expect fewer claims from policyholders.
If you choose to have a higher deductible, be sure to save money regularly so that in the event of an accident, you’ll be able to meet that deductible.
6. Improve Your Credit Score
While insurance companies operating in California may not use consumer credit scores to calculate rates, other states permit providers to access a driver’s credit history. This is because carriers have found a strong correlation between good credit and good driving behavior.
If you believe your credit history may be adversely affecting your insurance premiums, obtain a copy and review the accuracy of any claims made against you.
When searching for cheap car insurance, remember that your goal should be about getting the best policy and coverage in terms of value, not just the lowest price. Really cheap rates from a company with terrible customer service and claims processing can just be a stressful experience when you need your carrier the most.
7. Consider raising your deductible
If you buy comprehensive and collision coverage, you can save money by opting for higher deductibles. (There is no deductible on liability insurance, which pays for the damage you cause others in an accident.)
8. Consider usage-based or pay-per-mile insurance
If you’re a safe driver who doesn’t log many miles, consider a usage-based insurance program such as Allstate’s Drivewise, Progressive’s Snapshot or State Farm’s Drive Safe & Save. By signing up for these programs, you let your insurer track your driving in exchange for possible discounts based on how much you drive, when you drive and how well you drive.
If you drive less than 10,000 miles a year, you might be able to save money with a mileage-based insurance program such as Metromile or Esurance Pay Per Mile. Metromile is available in seven states; Esurance Pay Per Mile is available in Oregon.