Stop Paying More Than You Should For Auto Insurance

As you look to cut costs in your monthly budget, here’s one that might get overlooked: Car insurance. Why would you overlook it? Because you need it, and you may think that whatever you’re paying for car insurance is what you must pay.

Well, while car insurance is a necessity, you can lower its cost. And here are some of the best ways to do so:

1. Enroll in a defensive driving course.

It may not sound fun or even interesting, but taking a defensive driving course could cut your car insurance costs. Before signing up for one, call your insurance company to see if they offer discounts for making this move. If they do, ask for a list of approved courses to not waste your time or money.

2. Fix your credit.

Believe it or not, auto insurance companies can take your credit history into account when determining your premium. As for why they do this, it’s because companies feel that showing responsibility in one segment of your life probably carries over into others, such as driving.

The higher your credit score, the more likely you’ll see a lower car insurance premium. And fixing your credit now can help you in other areas of your life as well.

3. Look at your collision or comprehensive coverage.

Do you drive an old car with very little market value? If so, you may want to drop your collision or comprehensive coverage, as it may not be worth it.

Let’s say you get into an accident and your car is worth $1,000. If your collision coverage is $500 per year and the insurance company “totals” your car, those added costs may not make sense in your case.

4. Talk to your agent.

Your insurance agent isn’t just there to sell you something, as they should help you as well. Keep this in mind when talking to them, and ask them upfront if any special discounts could lower your costs. There may be if you were in the military, work for a specific company, etc. Or there may be discounts if you’re a member of a specific group or organization.

How about a surprisingly simple discount for receiving e-bills and electronic documentation? They may exist. And you may also get discounts if you decide to pay your six-month or annual premium upfront.

5. Carefully review your entire policy.

Have you ever sat down and read your auto insurance policy from top to bottom? If not, do so now to see if there are any unnecessary bells and whistles you can get rid of that’ll translate into savings.

For instance, you may not need car rental coverage if you never travel or always use your own car. Or you may not need roadside assistance.

6. Install an anti-theft device.

While many newer cars come with every anti-theft device imaginable, you may want to install one if your car lacks this area.

You’ll have to weigh the device’s cost versus the potential insurance savings before deciding to buy. But with a company like GEICO, for example, you could save up to 25 percent by installing an anti-theft device in your car.