How To Save Money On Auto Insurance
It’s important to understand that auto insurance premiums
can increase, even in the absence of a claim. Costs associated with
auto repairs, labor, medical costs, fraud and theft continue to
rise. Subsequently additional premium may be needed to cover such
Cutting your costs
There are ways to save on your auto insurance without compromising
your insurance needs.
Comparison shop. Check with several insurance
companies and agents. You’ll likely find differences in
service as well as premiums. Service should be a major factor
when making an insurance decision. Ask questions regarding the
claims handling process; how long they’ve been in business;
and the company’s financial stability or rating. Company
information is readily accessible on the Web. Ask family and
friends for recommended insurance carriers.
Raise your deductibles. You can reduce your
premiums if you shoulder the smaller losses. Increasing deductibles
from $200 to $500 could reduce your collision and comprehensive
premiums by 15–30%. A $1,000 deductible can save you 40%
Choose the right car. Before buying a car,
compare insurance premiums of similar makes and models. Premiums
are usually higher for luxury, sport and four-wheel drive models
because of repair costs and auto theft experience. Characteristics
such as vehicle size, weight and body type (two-door vs. four,
convertible, etc.) play a role in determining premiums. Vehicle
loss information is available online from the Insurance Institute
for Highway Safety at www.highwaysafety.org.
Contact the Ohio Department of Insurance for an auto
insurance shoppers’ guide. It provides all types
of information, including average Ohio auto premiums by company.
For a free copy, call 1-800-686-1526 or download it from www.ohioinsurance.gov.
Eliminate collision and comprehensive coverages,
especially older cars with significant depreciation. A general
rule is to eliminate these coverages if your car is worth less
than $1,000, as it may cost more to insure it than what you’d
collect after a crash. Check on your vehicle’s value with
an auto dealer, bank or through Kelley’s Blue Book (www.kbb.com).
Be sure to maintain auto liability coverage.
Ask about discounts. Many companies offer
a multiple-car discount or one for carrying homeowners or
type of insurance with them. Some provide good student discounts
or a credit if a young driver is away at school more than
miles, with or without a car. Some companies provide discounts
for safety equipment or devices. There’s also a discount
for seniors completing a defensive driver course. (Click
here for a list of state-approved programs and for
of available discounts.)
Eliminate duplication of coverages. If you
belong to an auto club that provides towing services or it’s
provided by the auto manufacturer, avoid coverage duplication
on your policy.
Reduce your daily driving. The more you drive,
the more likely you are to be involved in a crash—and
the more you’ll pay for insurance. Some insurers offer
discounts for driving fewer than a predetermined number of miles
Drive defensively. An at-fault accident or
major traffic violation can affect future increase premiums.
In some cases it can place you in a high-risk category. Some
companies reward policyholders for remaining accident-free for
a certain period of time.
Double-check how and where you park. Often
the cost of vandalism and auto theft is overlooked.
Avoid filing excessive or fraudulent claims.
The more claims you file, especially small ones that you can
cover yourself, the greater the likelihood that future premiums
will reflect this. Padding insurance claims negatively affects
the premiums we all pay.
- Keep tabs on your credit. An insurance score
is a snapshot of your insurance risk based on information in
credit report. It reflects your credit payment patterns over
time, with more emphasis on recent information. Many companies
insurance scores into account when assessing a potential auto
insurance risk. You can keep tabs on your insurance score via
the Web on www.choicetrust.com for
$12.95. To improve a score: Pay bills on time, keep balances
low on credit cards, and apply
for and open new credit accounts only as needed. Review your
credit reports from the three major credit bureaus annually
for inaccuracies. If you find errors, notify the corresponding
credit bureau. Click here for more information on credit bureaus
and insurance scoring.