6 Ways to Save
Money on Auto Insurance
Government officials and insurers are pushing for
changes aimed at lowering automobile premiums by fighting inflated or
fraudulent personal injury protection claims, but there are other ways you can
save.
Consider this advice from industry experts.
Shop around: Too many consumers don’t take advantage of the competition
among insurers for policies, said Alex Hageli, director of personal lines
policy at the Property Casualty Insurers Association of America.
“Once they get a policy, it’s almost like it’s on
auto pilot, and they’re really missing out because there are a lot of good
companies out there,” he said.
Some insurers offer quotes online or over the
phone. Or you can find an independent agent near you who can give you quotes
for about 10 companies, including large reputable insurers, according to Kyle
Ulrich, a senior vice president at the Florida Association of Insurance Agents.
Look for the best coverage and service at the best
price. The National Association of Insurance Commissioners has tallies of
complaints against insurers on its website and customer satisfaction ratings
are available from Consumer Reports and J.D. Power & Associates.
Check for Discounts: Discounts can lower rates for good students, senior citizens,
people who haven’t had tickets in the past few years, and people who work for
certain companies or are members of professional or alumni associations.
The logic is that “responsible students are
typically responsible drivers,” said Lynne McChristian, a spokeswoman for the
Insurance Information Institute, an insurance group. She said discounts may not
renew automatically, so remind your insurer when your policy is up for renewal.
Factors that determine your price may also
change—such as the safety of the neighborhood if you move or the distance you
drive to work—so updating that may help, said Rick Bogani, with Connect-Bogani
Insurance agency in Royal Palm Beach, Fla.
“If there is a student who may have an auto away
at college, alternate ZIP codes may be more competitive so those should be
checked as well,” he said.
Some insurers give discounts to drivers who spend
less time on the road.
Progressive recently rolled out a program to
provide discounts to eligible customers who allow the insurance company to
track how much they drive. The insurer reports that customers in 40 states that
have the program saved $20 as of this fall, an average of about $150 per driver
per year.
There are discounts for safety features such as
air bags, anti-lock brakes, lights that automatically turn on during the day,
and car alarms or other anti-theft devices.
Some companies also have discounts for customers
who renew their policies or buy multiple policies from them.
Drivers over age 55 can take a safe driving course
online for $15 to save 10 percent on their auto insurance for three years,
McChristian said.
“Check with your insurer first to see if there are
online courses that they offer discounts for, and make sure you select a
program approved by your Department of Highway Safety and Motor Vehicles
she said. “Some insurers may allow drivers as young as 50 to get a discount
after taking an online course, so it pays to ask.”
Consider Dropping Some Coverage: “A general rule of thumb is that if the car is worth less
than 10 times what you pay for insurance coverage, it may not be cost effective
to continue collision and comprehensive coverage,” McChristian wrote in an
email.
Hageli said one option is to get the minimum
amount of coverage required under state law—$10,000 personal injury protection
and $10,000 property damage liability. “It’s not ideal,” he said, but it may be
the only option for people struggling to make ends meet.
Avoid Extra Fees: Don’t pay for rental car
coverage if you don’t plan to use one or for towing coverage if you’re a member
of an automobile club that provides roadside assistance. If you can pay your
premium upfront, you could save on administrative fees that are typically
charged for monthly or quarterly payments.
Increase Your Deductable: This is a particularly good option for people who don’t
drive a lot and are good, defensive drivers.
“Increasing your deductible from $500 to $1,000
can save you 40 percent or more. But never choose a higher deductible than you
think you can afford if you were to be involved in a car crash,” McChristian
said.
Check Your Credit Report: You can check it online for free once a year, Hageli said.
Dispute inaccurate information in the report. In the meantime, if you suspect
your credit score is unfairly affecting your insurance premium, ask your
insurance company whether it’s a factor in determining the premium and if it
can be removed.
You can also work to improve the score.
Other life decisions that seem independent of
insurance can also have an impact on your rates, such as the frequency of
accidents near your home and the type of car you own.
©2012 the Sun Sentinel (Fort Lauderdale, Fla.)
Distributed by MCT
Information Services
