As per insurance experts, to get the lowest possible insurance rates from your insurer, you need to learn the type of coverage you need to carry, research several different reputed insurance companies and find out every possible discount that you are eligible for and take full advantage of them. There are pay-as-you-drive policies that are recommended by them which set premiums based on how much miles you cover in your car each year. Finally, if you live in states like California, Hawaii, New Jersey, etc you can look into their low-cost auto insurance programs which are offered to eligible people with very low incomes.
You are your best advocate when it comes to buying affordable auto insurance. But it is not advised to settle for the first insurance company that you find. Big insurance companies spend more money on advertisements for exposure and hence they charge more premiums when you buy their insurance policies.
Below you will find 10 steps to help you find the best possible car insurance at low rates without getting ripped off:
1. Your Car – Depending on the year, make and model of your car, the premium your pay comprehensive and collision coverage varies. Speaking in general, new and expensive cars attract higher premiums. So if you are looking to buy a car and can’t afford to pay a lot for insurance, then buy a car that’s inexpensive.
2. Coverage limits – Many states in the US have set coverage minimums for liability insurance, for both body and property damages. You can find out the minimums for each state by visiting your state insurance commission’s Web site. The National Association of Insurance Commissioner website can be checked which has listed insurance commissions in all 50 states and U.S. states. According to NAIC, if you are taking a loan for a new or used car, then the lender will most likely require you to carry minimum comprehensive or collision coverage.
3. Deductibles – You can lower your premium amount easily by taking the highest deductible possible by you. If you opt for a $1000 annual deductible instead of $250, you will pay less up front. But in case if you get involved in an accident, then you will foot in most of the bill before your insurance payment kicks in.
4. Credit score – Your credit history can also be taken into account when calculating your premium, which is called as insurance credit score. If you are maintaining a bad credit score overdue bills, bankruptcy, etc then you will end up paying more for your insurance premium. Improving your credit score by paying bills on time and anything to fix your credit problems will help you in reducing your premium.
5. Research – Before selecting an insurance company, go through several insurance companies and find out their quotations and the coverage they provide. You can also get in touch with agents to get quotes. You can start by visiting your state insurance commission’s website which usually lists the areas popular insurance companies. Then you can compare these companies by checking out which is providing better quotes, what their policy covers, customer reviews, the complaints they receive and other factors to filter out till you are left with one or two insurers. Finally you can opt for the insurance company that suits your requirement.
6. Finding an agent – If the insurance companies that you have shortlisted sell directly to customers, then you can visit their website and fill in your information to get quotes and have someone contact you. If the companies sell through an agent network, then you can ask your family and friends who have used the service of such agents, or you can check the insurer’s website to lookup for the location of agents in your area. Agents always offer attractive quotes to beat their competitors so it’s a good idea to contact them before deciding.
7. Discounts – Look out for discounts offered by insurance companies which include low rates for drivers who commute short distances, students, retired people, vehicles with safety alarm features, etc. According to the Insurance Information Institute, if you are above 55 yrs old, then you will be eligible for 10% discount by passing defensive driving course. If you are dealing with an agent, then don’t forget to ask them about such discounts. You can also ask for group discounts that some insurance companies offer for professional organizations and other groups.
8. Selective coverage – If you own an older car, then you can consider skipping comprehensive and collision coverage. If your car is very old, you could be paying much more for the insurance that what it is really worth. You can hold on to liability coverage since it is illegal in some states to drive without it and some insurance companies might charge higher premiums if it is lapsed.
9. State-run low-cost insurance programs – Many states have low-cost insurance programs for people whose household income is close to or less than poverty level. You can check in your state’s insurance commission website to check if you are eligible for such programs.
10. Assess insurance needs and costs annually – Our life isn’t static and similarly our insurance premiums shouldn’t be either. It is a good idea to review your policy once a year. If you have moved your house or switched to a new job which requires you to travel more or less, then you can review your policy needs accordingly. A review time is also good for you to checkout if you are eligible to any additional discounts.