How to Lower Your Car Insurance Costs

Car insurance is necessary for anyone driving any vehicle, whether it be a commercial truck or a weekend sports car. Most people consider this a necessary evil until they actually need the insurance, at which time they are grateful to have it. The biggest complaint most insurance companies hear relate to the cost of insurance. It seems to be quite costly, especially if you never have the need to use it. The good news is, there are some ways to cut the cost of your insurance. Here are some expert tips to lower your car insurance rates in the upcoming year.

Risk Factors

The key to cutting the cost of car insurance is reducing the insurance company’s risk. Therefore, should you require the insurance to cover a loss, the insurance company has not lost money overall. There are several ways in which you can accomplish the task of lowering risk. First, raise your deductible. The standard of most policies is around $500. However, if your goal is to reduce your insurance premium, raising your deductible to $1,000 or even $1,500 can help keep your monthly and annual costs down. It is important to remember, however, that should you file a claim, you must pay your full deductible amount out of pocket before you will receive any benefit from your insurance policy.

Another option to mitigate loss for the insurance company is to combine coverages with the same company. The more coverages you hold with one insurance company, the lower your overall premiums will be. The thinking behind this is that the insurance company knows that you may need to utilize one of your policies, but it is very unlikely you will need to use all of your coverages in one year. Furthermore, it is less overhead for the company to handle more than one policy per person.

Another major factor in the risk factor category is credit. Insurance companies often see those with bad credit as a higher risk overall. It has less to do with the fear that the covered individual will not pay the bill and more to do with the idea that people who have bad credit tend to be careless in many avenues of life. Whether you agree with this theory or not, keeping a good credit score will help lower your insurance premium.

Savvy Shopper

While mitigating risk is an essential element to reducing your overall insurance premium, being a savvy shopper is always a great idea. Insurance companies are not all the same. Premiums are not based on any clear laws or specific formulas. Each carrier has its formula for determining premiums associated with automotive insurance. Therefore, it is best to get numerous quotes from several different agencies to determine the best, most cost-effective insurance for your vehicle. By shopping around, not only are you better equipped to negotiate, but you are familiarizing yourself with the options different companies offer, which may or may not raise your insurance costs and may or may not be a worthwhile investment for you and your family.

To learn more about the options available in your town for car insurance, contact our experts at Protective Agency Insurance at (877) 739-9367.  A representative will be available to provide you with your options and a quote to fit your budget.