In this economy, everybody is more nervous about their money. Even if you generally feel comfortable and your bank account looks healthy today, there is just so much uncertainty in the world right now. Who’s to say things won’t change for the worse soon?
So, it only makes sense to try to lower your bills wherever possible. And one great place to look is at your auto insurance policy. Everyone has one and — for most people, in most cases — there are ways to save. For some, there may be ways to save a lot. But almost everyone can cut their bill by at least a little bit. And even small savings will add up over time.
Interested in lowering your premiums? Well, if you think you are paying too much for auto insurance, try these three strategies to realize some real savings today.
1. Raise Your Deductible
Some people think their deductible is set in stone. But the default value offered by any provider is usually something you can change — if you just ask. Now, this isn’t a way to earn a free lunch. If you raise your deductible, your premium should go down each month. That's great!
But it also means you are now responsible for a larger chunk of any repairs or damage caused by an accident. So while the ongoing savings are nice, there is a balance to strike. That's why this is usually only a good option for people who are already financially stable and have a large emergency fund in their savings accounts that allows them to comfortably accept this additional risk.
2. Find Lower Premiums
If the deductible route doesn’t make sense for you, there are other great ways to lower your premium. One may be right there at the end of your commute each morning: your job. Teachers, some lawyers, engineers, union workers in general, and some other professions can usually find discounts. And military members and veterans are able to get industry-leading coverage and great auto insurance rates from USAA, which caters to those who have served their country.
Then comes safe-driving discounts. You may be able to take a course that makes you eligible for lower rates. Some companies offer what is known as telematics that they install in your car to actually track how well you drive — and then provide discounts if you score well. Lastly, usage-based insurance could save you some money if you are a low-mileage driver who rarely goes farther than the store or on a short commute to work.
3. Get a New Car
Nobody should ever go out and spend tens of thousands of dollars on a new vehicle just to save a few bucks per month on insurance. That goes without saying and would only be attempted by fools. Nevertheless, if you are planning to change cars soon, you can make a strategic purchase that will help you pay a lot less in insurance over the lifespan of the automobile.
While rates vary considerably between makes and models, as a general rule, sports cars will lead to higher premiums and the same goes for luxury brands. Even color and other factors that lead to people getting pulled over more or vehicles being stolen more often can impact rates. But on the other hand, vehicles with better safety records and more safety features, like rear-seat and side airbags, usually lead to lower rates.
You Really Can Pay Less for Auto Insurance
Beyond meeting the legal requirements and doing what you can to maximize your coverage, there is one main question that everyone should ask about their auto insurance: Am I paying too much?
Most people probably are. But there are a few great ways to remedy this — and fast. Start by considering your deductible, look into possible discounts available on the marketplace, and then buy a safe, more modest car whenever you switch vehicles.
Just with these simple moves, you can start to keep some more of your hard-earned money. Nobody wants to overpay. So take the common-sense approaches and stop shelling out more than necessary.