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10 Easy Ways to Lower Your Car Insurance Costs

Car insurance is a monthly or annual expense that can be costly, depending on uncontrollable factors like location and car type. However, as with most things related to your vehicle, there are ways you can save money. From good driver discounts to advance payments plans – read ahead to find out how lower your costs.

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How to Reduce Your Car Insurance Costs

Although it may take some effort, the best car insurance discount is out there for you. If you believe that you are paying too much for your current coverage, consider trying one of these ways to reduce your costs. With a few simple changes, you could see a significant reduction in both your premiums and monthly payments.

1. Choose the Right Coverage

The type of coverage you have is one of the most significant elements affecting your vehicle insurance rates. Check with your state’s legislation and standards to see if a bare-bones policy is cheaper than collision and comprehensive coverage. To lower your automobile insurance premiums, pick a plan with a higher deductible.

Remember that switching to a high-deductible plan or reducing your coverage may increase your risk. If you take this approach, keep in mind that if you file a claim, you might have to pay more out of pocket. Also, remember that before deciding on a policy, compare automobile insurance rates from various companies.

2. Pick the Best Vehicle Insurance Provider

The easiest way to save money on your automobile insurance is to shop around before choosing a policy. Because each vehicle insurance firm uses different pricing strategies, the best one for you will be determined by how well matched you are to the company.

It’s possible that one firm may provide greater rates to new drivers while another business could appeal to a high-mileage motorist.

3. Bundle Insurance Together

You can often save money by buying multiple insurance policies from the same company. For example, you might get a discount if you buy both auto and homeowner’s insurance from the same insurer. Ask your agent about other possible combinations, such as renter’s or small-business insurance.

The plan will be a new one, with its own deductible. However, by utilizing the same provider across your plans, you may save money in the long run.

4. Pay Car Insurance Premiums in Advance

A typical discount is offered if you pay for the full insurance term in one lump sum rather than in monthly payments. Keep in mind that this is only a smart option if you have sufficient cash on hand.

If you must use a credit card to pay for the whole cost, you’ll almost certainly pay more in credit card interest charges than you would save on your car insurance discount.

5. Take a Defensive Driving Course

A simple method to save money on your auto insurance is to get a multi-year premium reduction with a minimal investment upfront. Many insurance providers provide discounts for individuals who complete an approved defensive driving course. This can help drivers who have been in an accident reduce their license points, as well as reduce rates for people with a clean driving history.

The laws regarding defensive driving courses and insurance premium reductions vary by state, so it is best to consult your local DMV or insurance provider. In New York, for example, a 6-hour course costs approximately $30 and drivers can receive up to a 10% reduction on their premiums for three years.

6. Get a Low-Mileage Discount

Insurance companies offer discounts to those who drive less. If you’re retired, live close to work, frequently take public transportation, or don’t drive extensively, a low-mileage discount can help save you money on your car insurance premiums.

Check with your insurance company to see if you qualify for this simple method to save money on car insurance.

7. Improve Your Credit Score

When you get your insurance quotes, insurance providers may consider your credit score if it’s legal to do so in your state. This can mean that improving your credit score will help you to lower your base rates.

The first step to improving your credit score is to check your credit report. Resolving any issues or inaccuracies can be a quick fix that can have a big impact on your insurance rates. Also, take steps to gradually improve your credit score through financial practices such as paying your bills on time.

8. Opt-in to a Usage-Based Insurance Program

Depending on the state where you reside, some companies provide discounts based on your actual driving habits. These programs usually utilize a telematics device installed in your automobile to record driving activities such as hard braking and the number of miles driven.

Usually, signing up for a monitoring service comes with a discount. Find out what is being tracked by your provider and whether or not you meet the criteria in order to avoid any unpleasant surprises. It’s also a good idea to double-check that your rates won’t go up if you’re deemed a risky driver.

10. Choose the Right Car

The kind of automobile you insure affects your insurance rates as well. If you want to save money on your auto insurance, consider trading in that sports vehicle for a more insurance-friendly model. Expensive vehicles with a high risk of damage are less likely to receive a bargain price. Standard model automobiles with the best safety features are generally the cheapest to insure.