9 Tips for How to Save Money On Auto Insurance

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car insuranceWhile auto insurance is required to operate a motor vehicle on streets and highways, that doesn’t mean you have to pay a lot for it. Below, you’ll discover nine ways to save money on auto insurance and put a smile on your face.

1. Always ask about discounts – All auto insurance companies offer a menu of discounts. They’ll grant some of them to you automatically, but there are plenty of others they don’t readily advertise. For example, they may not mention a military discount because they may not know you’re a military retiree. So be sure to ask about all of their available discounts. Here is a list that can also help you know what’s available…15 Car Insurance Discounts All Drivers Should Know About.

2. Shop around and get several quotes – Car insurance rates can vary by a lot. That’s because all companies are different and they can charge whatever they want. One company could pay out big salaries to it’s executives and operate inefficiently, while another could be a penny-pincher on their expenses. So get multiple quotes before making a decision.

3. Maintain a good FICO credit score – I don’t know if you knew this, but insurance companies check your credit file before approving you for a policy. If they find bad things in there, they could reject you outright or charge you a higher rate.

4. Never let insurance lapse on a financed vehicle – If you fail to pay the car insurance on a vehicle that you are financing, the insurance company will notify the financing company. The financing company will then get coverage on the vehicle and start charging you for it monthly. The bad news is that the rates they charge you will likely be much more than you were paying under your policy.

5. Adjust the deductibles – A deductible is simply the amount that you prefer to pay out of pocket. For example, if you’re involved in an auto accident and your deductible is $1,000, this means that you must pay the first $1,000 for any damage to the vehicle and then the insurance company will cover the rest. So the higher the deductible, the cheaper your annual premiums. Over time, this could add up to thousands of dollars.

6. Buy insurance from direct sellers – Many insurance companies use agents to help promote their products. But there are also some companies that sell auto insurance directly to the public without insurance agents. Buying from direct carriers can save you money. Some of the names that you may be familiar with include Geico, Progressive, USAA, and Hartford.

7. Keep a good driving history – Other than age, the influencers that determine how much you’ll be charged for insurance include things such as speeding tickets, dui’s, and accidents. If you can keep your driving record clear of these negatives, your insurance rates will remain low.

8. Don’t have long breaks between policies – Insurance companies use the word “persistence” to refer to someone who has always had insurance on their vehicles. So when you maintain your persistence, they like that. And if you do have breaks where policies lapsed or were canceled, they could you charge you higher rates.

9. Inquire about all fees – Just to make sure that you don’t have a Homer Simpson “Doh” moment, ask the insurance company about any and all fees, deposits, charges, costs, etc., before signing up. You don’t want any unwanted surprises later on.

So that’s nine ways for how to save money on auto insurance and reduce your rates. Specifically, you should inquire about discounts, get multiple quotes, maintain good credit, increase deductibles, buy from direct sellers, and maintain a good driving record. You’ll quickly discover that it doesn’t take much to save hundreds, if not thousands of dollars.