Wednesday, June 23, 2010

6 ways to lower your car insurance bill

Last December I wrote an article called “Can you really afford not to check your auto insurance policy regularly?” were I took you step by step on how to buy car insurance in your state and what information you need to fill out the application. Today I am continuing this series with a second article on how to lower your car insurance bill.
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1. Shop around:

Shopping around to find the best deal for car insurance in your state (if you live in the United States, each state has their own list of companies that you can do business with) or country is one the best piece of advice I can give consumers. Each company has their own system for handing out a car insurance quote. You would be surprise just how much of a difference each company’s quote can be.

But keep in mind that just because a quote is lower than all of the rest, that doesn’t mean you should sign up, instead check out the company online with several sites first, you want to go with a trusted company. What good is a quote if the company doesn’t have the customer service to back it up.

2. Buying a new or used car, check for a quote first:

The make and model of your automobile will affect your premium or your car insurance bill, but one way to lower the bill is your choice of vehicle. Muscle cars are different from trucks, trucks are different than passenger cars and so on and so is the premiums. The same can be said for the engine size, drivetrain (FWD, AWD, RWD, 4WD), they make a difference and etc.

A consumer that is trying to decide between two vehicles could use this option to decide between the two. If one car costs $1200 to insure, while another costs $900 that could be a real good point in buying the car. By the way, if you fall into this category with using the quotes as factor, you might want to also check online and with the dealership to find out what the maintains costs will be as well as the warranty. The total cost including insurance is what sells the car.

However if you buy a older car, you might be able to lower the cost by working with an agent on dropping collision and/or comprehensive coverage’s if the car isn’t worth that much. Check out Kelly’s Blue Book for the value of your car. I would go to an agent to see exactly what you can do here and keep in mind, I have never done this before on my car insurance. Weight this option carefully before you sign.

3. Change your deductable:

Working with your deductable can make a difference in your premium. For example, instead of a $250 deductable, you might want to consider either a $500 or $1000 deductable. But be careful that you don’t put yourself into a financial pinch if you have an accident, meaning you need to have to that deductable (money) set aside in a savings account or something if you have an accident to cover what the insurance company doesn't cover. And don’t depend upon a credit card, that’s not a good idea, you want to save money, not pay interest on $500 or $1000. The most common deductable is $500 and is pretty reasonable for most consumers.

4. Put Teens on Parent’s insurance policy:

A teenager in this day and age in most cases whether you live in the United States, United Kingdom, Australia, or just about any other country shouldn’t have their own car insurance policy, nor an expensive car. It’s really too expensive for them to neither handle nor spend the money on it. This could cut you as much as half the bill and I’m not kidding depending upon where you live especially in the UK.

5. Bundle/combine your homeowners insurance and auto insurance with one company:

Bundling seems to be a good idea depending upon the company. Each company is different, but generally if you bundle, you can get a discount from them for having more than one type of insurance on one bill. And let’s be honest here, this bundling works on your cable/internet/phone bill as well.

Plus having one company handle both your homeowner’s insurance and car insurance can make it easier for you when it comes time to pay the bills. If you really want to bundle and save even more, you might try buying your car insurance, homeowners insurance and life insurance with one company. This can be done, but I don’t know anybody who does it, however like everything, make sure it all fits for you.

6. Check for discounts:

You would be surprised with what extra items that are already on your car could save you money in the long run as well as how you got your driver’s license.

- More than one car on a policy, Air bags, low annual mileage (how far you drive in a year, if you’re under the average mileage per year, can save you money), anti-lock brakes, good driving records, security system and more. The biggest thing, ask, it doesn’t hurt to ask.

And of course, a good credit report makes a difference as well. Yet again, the credit report comes into play, it doesn’t matter if you’re getting a mortgage to buy a home, rent an apartment, buy a new or used car, get a job, your credit report makes a difference at least here in the United States it does.