Your car insurance premiums are very much determined by the type of motorist you are and the kind of car you drive. Knowing this, you may tend to believe that you have little influence over the amount of money you pay your insurer every month. But that is not true! There actually are ways to reduce your car insurance costs significantly, and here are 7 of them.
1. Combine your policies
If you own more than one car, the chances are that combining your policies with one carrier will lower your insurance premiums. The reason for this is that most automobile insurance companies offer discounts for multiple-vehicle policies. Insuring your cars with the same carrier is not only convenient: it could also save you big bucks!
This rationale does not only apply to cars, however. In effect, if you own assets of another kind, such as a house or a recreational vehicle, insuring them with the company which also happens to take care of your automobile could be highly profitable.
2. Request higher deductibles
When you insure a car, you agree with your company on a deductible, which usually ranges somewhere between $250 and $1,000. In a nutshell, a deductible simply is the amount of money you have to pay yourself when you file in a claim; the rest of the bill is assumed by your insurer.
The trick lies in the fact that agreeing to a small deductible may increase your monthly payment which, in the long run, will cost you more than you first thought especially if you never file in a claim. You should thus compare the impact that various deductibles have on your monthly payments.
3. Drive less
What determines your car insurance premium is the “risk” factor. The more at risk you are of filing in a claim, the more money your insurance will cost you. Risk has numerous components: one of them concerns how likely you are to be caught in a road accident. Not surprisingly, those who drive a lot are considered to be more at risk.
Some companies now offer “pay-per-mile” automobile insurance programs tracking the distance their clients travel with their car. Others offer “low-mileage discounts”. These types of programs can be highly profitable for those who do not drive much. You should thus consider reorganizing your driving habits around a schema that makes you save money!
4. Improve your driving record
Spending years on the road without being caught in a single accident looks very good to your insurer and rhymes with low risk. Therefore, being careful every time you take the wheel may first and foremost be a matter of protecting your life, but such responsible behaviour may also have a positive impact on your insurance costs.
Another way of saving money is to avoid filing in a claim every single time your car is dented. Even though reporting accidents is important in most cases, filing in no claim when the damages do not add up to big amounts of money may be profitable for you. In fact, repeated claims may well cover repair costs, but they also increase your monthly insurance payments!
5. Keep your insurer posted
Telling your insurance company about home address and job changes is not only a matter of keeping your file up-to-date and devoid of inaccuracies. It is also a way of making potential financial gains. Imagine you used to live in an area where the accident or vehicle theft rate is the highest in the country: moving to a safer area reduces the risk factor and could decrease your insurance premium accordingly!
6. Choose your car wisely
If the model of your car is one that is abnormally involved in road accidents or one that happens to be a robbers’ favourite, you can be assured that your insurance costs will be quite high. Choosing your car model wisely according to its mechanical complexity, its cost, its statistical risk of being caught in a crash or of being stolen has a strong money-saving potential.
7. Go for safety gear
Airbags, automatic seat belts, visible wheel locks, anti-lock brakes, daytime running lights, electronic keys: all of these security devices significantly diminish the risk of your car being damaged or robbed. Having them may substantially lower your insurance costs. Thus, when you go shopping for your next car, do not look down on such devices as they could be worth hundreds of dollars in insurance savings in the long run!
About the author : Alexandre Duval is a blogger for Merlin Assurance. He is also currently completing his master’s degree in political science at the University of Quebec in Montreal.