To those following our articles on the importance of motor insurance and articles where we juxtapose states on car insurance, it’s no longer news to them that insuring vehicles is a very expensive affair.
Given the fact that this exercise ( insuring your automobiles) can gulp a significant part of your budget, you should know some ways to slash your monthly payment. In today’s post, we will detail some of our favourite strategies for doing just that.
Increase your payables
Basically there exist two types of payments when buying insurance. You have the premium and the deductible. The later basically is the amount of funds you’d be responsible for in case of damage. After paying that money, whatever is left of the repair, you cover will take care of.
Look at this scenario, imagine you have agreed to pay a deductible of $1000 in accident coverage, then that means before your insurers will cover for the repair of your accidented automobile, the cost of the repairs has to be more than $1000. and you’d be the one to offset the first $1000, anything after then, the insurers should take of.
Sometimes, you really only need assurance against bankruptcy or crippling financial damages and are fine with spending a couple hundred or thousand dollars if your car needs to visit the repairman.
Talk with your coverage providers and know what they think, and also how it ( your deductible) would affect your monthly payment.
Opt for collision or liability coverage only
If your automobile has depreciated most of its value away, strongly consider if you have to buy comprehensive insurance. Afterall the vehicle is old, its value might be next to nothing.
Many a time, it is certainly not worth it, and many times an older vehicle won’t take a large collision before the company will decide that the car is too gone for anything to be done about it.
Shop for Estimates from different Firms
As with every insurance agreement, getting estimates from various insurance carriers is the smart step to take.
As you juxtapose estimates, make sure that services being compared and contrasted are equivalent, this would help you understand and make the right decision as you decide the company to choose.
Sometimes companies use marketing tactics to make their premiums look lower, such as offering a lower payment the first month or quoting bare minimum coverage, and it is often not straightforward to fully understand whether you are comparing apples to apples.
Consider bundling your auto insurance policy with other products
Do you have an auto insurance policy with one company and a renter’s or homeowner’s insurance policy with another one?
If so, you could potentially be leaving large savings on the table, as insurance companies really value having multiple products with one client.
They will many times offer discounts to customers that do choose to bundle with them. Not only does this represent savings , but it can also simplify your life as then it means you only have to deal with one insurance company instead of two or multiple.
There are many products you can bundle, including if you already have a motorcycle or a recreational vehicle, or even a life insurance policy as some firms will let you bundle with this.
Pay your policy in full instead of financing it
Loads of brokers would prefer bulk payments or for you pay your policy in full for the length of the term (usually 6 months), they usually offer discounts for this. If you possess the financial capability you should certainly take advantage of this option.
Choosing the monthly instalment option usually comes with a hefty premium if over the lump sum payment, and even more if your credit is less than excellent. On that note, you should be aware that your credit quality is one of the most important factors that insurance companies use to determine your insurance premium.
If you have bad credit, definitely do what you can to improve it and you will see the benefits in the form of reduced premiums.
Take a defensive driving course
Some insurance companies will want to see that you are doing your best to improve your driving, and to support that one of the best things that you can do is to take a defensive driving course.
These courses will teach you how to be a safer driver and often you can get a discount with your insurance company after having taken one.
Some of the things they teach in defensive driving are how to anticipate situations that could potentially lead to an accident, and how you can make the best decisions on the road given those situations you are detecting.
It is also a matter of unlearning bad habits you may have picked up over the years, as most Americans do not take any driving classes at all once they obtain their initial driver’s license.
Considering the fact that most Americans get their driver’s license at 16 when they are young teenagers, this means that most drivers on the road today in the US have not taken a driving class in many decades. One can only imagine the bad habits people pick up after not being to a class in decades.
Take advantage of your own insurance company’s programs
Progressive in particular has a program called “Snapshot” in which you can receive reduced insurance premiums in exchange for installing a kind of tracking device. Progressive will then monitor your driving habits, and if they determine you to be a safe and cautious driver, then they will lower your premium accordingly. Some of the things they teach in defensive driving
It is expedient to realize that when it’s all be said and done, an insurance policy is really just a contract between you and the insurers where they are agreeing to cover some risks that would traditionally be yours in exchange for some monthly premium.
If you are willing to retain some of those risks and shiftless risks to the brokers, then many times you can see a reduction in your premium. This is a trade-off, and you should carefully examine your own personal situation before going down that road.
My name is Jaime A, I am a licensed insurance producer in the Commonwealth of Puerto Rico for property and casualty insurance. I am an engineer by trade, but my true passion is helping consumers save money on their monthly bills. If you would like to learn more about me, you can visit my LinkedIn profile.