It’s the question that’s been around since the first car was sold, “how can I lower my auto insurance?”
You go to the mailbox and find a letter from your insurance company, your hands are shaking because you know there is a possibility that your rates are about to go up. If you are like most of us this year your rates did go up.
I didn’t have an accident or a speeding ticket, why did my rates go up?
There are many reasons why rates go up, the simplest answer is “bad drivers”. Fatal accidents are the highest they have been in over a decade and are increasing each year. The largest factor in these increases, distracted drivers.
So how do you combat these rate increases? Here are a couple of tips to keep your rates as low as they can be.
1. Bundle Multiple Policies With The Same Insurer
Many insurers will give you a discount when you have multiple policies with them. If you are not a homeowner don’t worry, most insurers will still give you a discount for the other types of insurance you need like renters insurance, umbrella insurance and personal articles insurance (jewelry, engagement rings, etc.)
2. Ask For More Discounts
Are you getting all of the discounts that you are eligible for? Different insurers have different discounts. Discounts can range from safe driver discounts to new car discounts and everything in between, some insurers will even give you a discount if you have a College Degree. Bottom line, if you think you are missing out on some discounts be sure to ask your insurer or your agent.
3. Pay Your Bills On Time
This goes for all of your bills, not just your insurance. Most people are aware that their credit score is one of the largest factors in how much you pay for car insurance. If you let your insurance lapse will also play a role in if an insurer will even offer you insurance. If you know you will be shopping around for insurance soon, try to get your score up by paying down some debt and being careful on the number of credit inquiries you have. Every point helps when it comes to your credit score.
4. Raise Your Deductible
The higher your deductible, the lower your payments will be. The more risk you take responsibility for (higher deductibles) the lower amount of risk you leave for the insurer. Be sure you raise your deductible to a rate that you are comfortable paying if an accident does occur.
5. Get Multiple Quotes
Don’t stop with just one quote. A lot of agents are limited to quote you for the insurance company they work for, these are called captive agents and they can only quote one company. Get quotes from different insurers, insurance companies’ discounts and rates change all the time. Just because your insurance company had the lowest rate last year doesn’t mean they have the lowest rate this year. Another insurance myth is that each quote will show an inquiry on your credit report. Insurance companies never do a “hard pull” on your credit. You can get as many quotes as you like and they will never hurt your credit score!
6. Choose The Right Coverage
Don’t be over insured, but don’t be under insured. Make sure your coverage fits your lifestyle and your budget. If you have an older car you may want to consider only carrying liability insurance. Ask your agent if this will be a good fit for you. Don’t be afraid to get a second opinion!
7. Drive Safe
We all know that accidents and speeding tickets can and will affect your rates. So don’t speed and try not to get distracted by today’s gadgets while driving. It can take years for these violations to fall off your driving record.
8. Lock In Your Rates
If you have the option to go for a 12 month policy and you have no violations, take it. You will lock your rate in for the entire term if something does occur. Some insurers don’t offer more than 6 months at a time, this is because they can adjust your rates if something does happen.
9. Pay Your Policy In Full
If you can afford it, pay your policy for the full year. Most insurers will give you a discount for paying in full. If you do choose to make payments you will also pay an installment fee, this is generally no more than a few dollars per month but it all adds up!
10. Use An Independent Insurance Agent
Independent insurance agents can give you quotes from multiple insurance companies. Captive agents can only give you a quote for the company they work for. Independent agents generally have the knowledge of which company will fit your needs and budget best!
Fairway Insurance is an Independent Agency Servicing all of your insurance needs. Call or email us today to see how much you can save on your Auto Insurance!