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15 Simple Tips For Cheaper Car Insurance Rates

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Saving money on car insurance is easier than you think… with a little bit of self education. Here are 15 simple things you can do that will save you money, while better protecting your car and its occupants.

So have at it – become a confident, educated consumer and make sure you pay the lowest possible price for your car insurance!

15 Tips To Get Better Insurance Rates

  1. Understand insurance companies – The auto insurance industry is divided into three types of businesses: Direct Agents, Independent Agents who sell the insurance of various companies, and Exclusive Agents who work on commission and can only sell one brand of insurance. If you have a good driving record, it’s likely you’ll get the best deal from a direct agent because they remove the middle man.
  2. Shop around – This is easily one of the most important factors to consider. Don’t take quotes from just a couple auto insurance companies. Instead, really look into what each has to offer and which discounts they can give you.
  3. Ask for insurance advice at your body shop – Your local body shop works with insurance companies and their adjustors nearly every day. Ask them which companies they prefer and which have the smoothest claims process.
  4. Check with your state’s insurance department – Depending on which state you’re in, many publish consumer complaint data and complaint ratios that show how many consumer complaints have been made against each company. Make sure you choose a company that you’re comfortable with and has gotten good reviews.
  5. Slow down – If you’ve had several speeding tickets, you’re much less likely to get discounts for safe driving.
  6. Etch your VIN – Studies have shown that cars with an etched-in VIN are much less likely to get stolen. By avoiding a stolen car, you’ll avoid a claim.
  7. Verify the accuracy of your policy – If you haven’t done so, take a minute to browse through your policy to make sure everything is correct. You’d be surprised at how quickly small charges can add up.
  8. Avoid lapses in coverage – Even a few weeks’ lapse in coverage can make you ineligible for discounts. If you’re in the process of switching carriers, make sure you don’t quit your previous carrier until the new coverage takes effect.
  9. Don’t claim small amounts – If you often make small claims (less than $500), you may have to pay a higher premium when it comes time for renewal. If you make a significant amount of claims in one year, your insurer may not want to cover you at all. Next time you have a claim, make sure it’s worth it in the long run.
  10. Limit the number of people who drive your car – The more people you have listed as drivers, the higher your premium will be. Teenagers and young adults under 25 are among the most expensive drivers to add to the policy.
  11. Verify the accuracy of your VIN – Most drivers are unaware of this, but an inaccurate VIN (even if it’s off by just one digit) can affect your auto insurance quote. Double check your VIN to ensure you’re not being overcharged.
  12. Mind your credit score – More and more auto insurance carriers are considering credit scores when giving you a quote. Sometimes, having bad credit can end in you paying up to 50 percent more. So, make sure to pay your bills on time and check that there are no items on your credit score that aren’t yours.
  13. Evaluate insurance costs when purchasing a new vehicle – When considering a new car, get a quote on your insurance rate, as the year, make, and model can make quite a big difference. Newer, sporty cars will be significantly more expensive to insure than used, family-style cars.
  14. Purchase a low profile car – Similar to the above, know that cars that are expensive to repair or have a high theft rate will end up costing you quite a bit more to insure.
  15. Don’t “pimp your ride” – Research has shown that adding modifications to your car, like a rear spoiler or lowering the suspension, can nearly double the cost of coverage.

 

 

 

 

 

And there you have it! Next time you’re shopping for new auto insurance, keep in mind the above tips – you may be surprised just how much money they can save you in the long run.

This is a guest post from Pam King.  Pam writes on frugality, safety and insurance literacy for Direct General, a provider of cheap car insurance . When not saving money on her insurance, Pam enjoys knitting, NASCAR, family and watching rollerderby! :)

How To Save Money When Buying A Car

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We're in the middle of a search for a bigger vehicle for our family. We recently had our first child, and my wife's little Honda just isn't cutting it anymore when it comes to carting around the baby and all his stuff. It's just getting too cramped. At this point we're looking into what type of vehicle to buy – anything from a mini-van to a smaller SUV. While we haven't settled on anything, my wife can't stand mini-vans, so we're leaning towards buying a SUV.

When buying a new car, there are a lot of things that you can do in order to save money on your purchase.  Some will save you a little money – and others will save you hundreds or thousands of dollars.  So let's get started!

Things You Can Do To Save Money On Your Automobile Purchase

Saving money on your auto purchase can be done in a variety of ways – from doing your due diligence and research  before you shop – all the way to figuring out what make and model to buy.  Here are the tips we're using to save money on our next purchase.

  • Research potential cars, and how to sell your own:   If you're looking for a new car, make sure that you give yourself time to look into exactly what type of car you want to buy, how much it should reasonably cost, fuel efficiency, reliability and other factors that can affect your decision.  Also look into selling your current car, and figure out how much you can get for it either by selling it as a private party sale – or by trading it in.    Use sites like CarSoup.com, Autotrader.com, Edmunds.com and ConsumerReports.org to give you a ballpark value of what your car is worth so that you can get top dollar for your car.
  • Used vehicles save you thousands: When buying a car we often dream of buying that high end luxury ride, instead of buying something that just fits our needs. We want a brand new car that still has the showroom smell.   If we are honest about it, however, we can see that buying a pre-owned car, one that's 2-3 years old with low miles – will end up saving us thousands of dollars.  The reason?  New cars lose up to 60% of their value within the first 4 years.  That's a lot of value just disappearing into the ether!  Instead of buying a brand new car, do as we did with out last car.  We bought a 3 year old sedan that was close to $20,000 new.  By buying the same car as a used car, we got it for around $11,000, and it only had 29,000 miles on it!  (plus it still felt like it was brand new anyway!)
  • Buy from a private owner:  When you buy a car from a dealership, there is going to be markup over what you might pay to buy the car from a private party.   That's why when you go to Kelly Blue Book's website, there is a price for retail and one for private party that is lower.  One caveat – just make sure that you get a vehicle history report and having the car inspected by a trusted mechanic to ensure you're actually getting a good deal.
  • Paying cash saves interest:   My wife and I have been paying ourselves a car payment for the last few years.  The result is that after a couple of years you end up having a nice stash of cash to pay for your next car in cash – instead of getting a loan.  While rates may be low right now, you'll still save by paying cash instead of getting a loan (of course unless you get one of those 0% financing offers – in which case you're probably not saving by getting a used car).  Set up a high yield savings account, and start saving your payments!
  • Rental cars can save you money too:  Our last two cars that we purchased were both rental cars.  While you might think that buying a rental car isn't a good idea (there is a common thought that rental cars are driven harder than other cars), we've found that for our family it ended up being a great deal.  The rental cars that we bought were lower in price, but were both in great shape – and had been maintained meticulously by the rental agency.  My last one drove wonderfully until i got rid of it at 130,000 miles.
  • Extra options mean big  money:  If you leave off extra options like sunroof, leather and premium sound packages, a $20,000 car can quickly become a $16,500 car.  Carefully consider which options you actually need.
  • Negotiation on price may be necessary:  Sometimes whether you're comfortable with it or not, you may need to be willing to negotiate with a car dealer to get the best price.   If you don't like negotiating, consider getting a family member who doesn't mind doing it – to do it for you.  Make a game out of it offer to give your friend or family member a percentage of whatever they save you in negotiation.
  • Make sure to get an inspection and a vehicle history report:  Pre-owned cars will have different histories, and you need to be careful that you don't buy one that has negative events in it's past.  Get a vehicle inspection from a mechanic you trust, and also get a vehicle history report to confirm it hasn't had flood damage, accidents or other negative events.  Skipping this step could cost you thousands down the road.
  • Don't buy an extended warranty:  Extended warranties are one of the places that car dealerships make some of their biggest profits.  The reason? Most people that buy them never use them.  If you want to get a warranty anyway, consider buying from an outside company for less than you can get a policy at the dealership.  Or even better, self insure yourself against the risk of mechanical failure by saving up a “car repair emergency fund“!

There are lots of ways that you can save when buying a car.  Some of the tips will save you more than others – but really it all comes down to doing your research, preparing yourself, and going out to do battle – to save money!

Have your own tips for saving money when buying a car?  Tell us your car buying strategies in the comments!