Before we get into cheap car insurance and delve on ways and methods of getting one, we need to understand the working of car insurance in a little more detail. Understanding car insurance can be little difficult with so many options being offered by so many companies.
Some relevant facts are given below that can help you in the quest. These facts are not understood by many car owners and thus they end up paying more for car insurance where they could have saved some money.
Most useful car insurance coverage is inexpensive: The basic car insurance coverage is very simple and inexpensive. However, with additions like roadside assistance, gap coverage, uninsured/underinsured coverage, rental coverage and the comprehensive coverage can cost a lot more. Paying a little more does help in bad times, however, you will need to assess the value you are getting for your money before you decide. It would help to understand here that the most expensive coverage you can get is the comprehensive one and it is still about 1/3rd the liability coverage and ½ the collision coverage. So, the whole scenario needs a little more analysis with regard to your needs and coverage options that can render your car insurance cheaper or expensive.
Factors that influence the car insurance premium: While underwriting your car insurance, insurance companies take into account a lot of factors. These factors vary from company to company and normally aim at classifying your case into a low risk, risk or a high risk category. Many companies look at your driving record, insurance record and credit history for the last five years before deciding on such classification.
Company based insurance rates: Car insurance is highly competitive and thus premiums vary from company to company. In fact, this is a USP for most advertisements. This implies that you need to shop around for cheap car insurance with all coverage you need before making a decision. The basic price of insurance for a said policy is set by the law and cannot be changed. Thus, reduction in price is only possible by playing around with the coverage.
Expiration: In case your car is not covered by insurance for some amount of time, you may end up paying more for the same eventually. So, even if you are changing companies, make sure that you get your new car insurance policy before the previous one expires.
Deductibles: Insurance is related to risk and the premium is fixed keeping in mind the damages that the company may have to pay in the event of an accident. If you increase your deductibles and are willing to pay more percentage of your damages, the premium will automatically come down due to lowered risk.
Discounts: There are various kinds of discounts offered by almost all car insurance companies. They are secure car discount, full payment discount, internet discount, safe driving record discount etc. Making use of these discounts can save you a lot of money on the cheap car insurance.
Coverage: You can adjust you coverage according to the age of your car, your driving habits and routes etc. Give this a little thought and talk to your insurance agent to get the best coverage at affordable rates. Most states look at a minimal coverage, so you will need to decide on coverage by your location and frequently visited areas.
Car model: The type of car you drive is very important in calculating your car insurance premium. If you drive a top-of-the-line Aston-Martin, it is obvious that repairs involved will cost a lot of money and thus the insurance company will have to pay more in case of an accident. If your car has all safety features and the passengers have a lesser chance of getting hurt, the insurance company may not have to pay for bodily injury, in such a case, the premium will be lower.
With this we assume that you have understood the variables that go into calculating your car insurance premium by a car insurance company. Now, let us look into some pointers that can help you get cheap car insurance.
Install as many anti-theft devices as you find useful. This can greatly reduce the chances of theft and thus the insurance premium.
If you own more than one car, your car insurer can grant you a multi-car discount and this can reduce your premiums drastically.
Annual premium payments are the best and offer the best discounts. The rates are fixed for the year and since you will be making a full payment, you are eligible for a discount.
Check your mileage regularly. The number of miles you travel greatly influences the insurance premiums and the lesser you travel, the better premiums you will end up paying.
If you are a member of a club or any organization you can get a group discount on insurance premiums. Many car insurance companies offer group discounts to various organizations. Check if you fall into the category and make use of it to reduce your car insurance premium.
Many car insurance companies give huge discounts for drivers who attend defensive driving courses. You may need to spend once on the course but you will be eligible for recurring benefits over the years by reducing your car insurance premium.
Your credit rating and car insurance premium are closely related. If you have a good credit rating, you can get cheap car insurance since the insurance companies consider low credit rating as high risk.
You can adjust your coverage. For example, if you have comprehensive as well as collision coverage, you will not need rental coverage, since the coverage will be the same, no point in paying for something that is already covered.
If you think that you fall into a high risk category, before you opt for a ridiculous coverage premium, talk to your state insurance commissioner. This will help you to understand your options better.
The above are only a few pointers to get you cheap car insurance. However, based on your location and state laws, you may be able to reduce it further. Hope this articles has been successful in achieving its objective of getting you some insider information on car insurance companies and ways to get cheap car insurance.