We all have to pay for car insurance, but that doesn't necessarily mean that we all have to pay the same price. You may already be paying too much for auto insurance when you actually qualify for discounts and benefits that can keep your rates low. If you're looking for ways to save a little extra money each month on car insurance, consider the following top seven most effective ways to save money without sacrificing protection.
1. Compare and contrast
When you want to find the best price on anything, the most effective way to do this is to shop around at multiple carriers to determine the best price. There are plenty of popular insurance companies and local companies in your area that all have different packages and different prices. Find out which company is the most lenient on your unique situation. For example, if you have a less than perfect driving record, you'll want to see which company penalizes driving records the least to get the best price.
2. Avoid insurance lapses
When you let your auto insurance expire without renewing it for an extended period of time, you will find that obtaining new insurance is even more difficult than just renewing it right away. This is because drivers who let their policies expire are statistically proven to be higher risks to the insurance company, which may result in increased coverage rates.
3. Raise your deductible
Your deductible is the amount of money you are required to pay to contribute to repairs after an accident occurs. Naturally, raising your deductible can lower your insurance rates, but you will want to make sure you don't raise it beyond what you can afford. Determine how much money you have in the bank along with what you could potentially dish out in the event of an accident to calculate an appropriate figure.
4. Only buy what you need
You may be persuaded into acquiring huge coverage plans that you don't realistically need, especially if your vehicle is old and of low value. If the cost of repairing your vehicle in a car accident would cost more than replacing the vehicle, you might want to consider investing just in liability coverage to avoid putting too much coverage on your clinker.
5. Take an educational course on safe driving
Insurance companies tend to reward safe drivers for keeping a clean record and going the extra mile to promote safety on the road. Taking a defensive driving course is a good way to prove that you have been properly educated and evaluated as a safe driver. When you show your insurance company that you have taken these extra measures, they will likely lower your insurance rates since you are at a lower risk of getting into an accident.
6. Build up your credit
Statistically, people with high credit ratings are less likely to file insurance claims. Based on this information, your insurance company will be a lot more lenient on you if you have good credit. To keep your credit in good standing, pay off your debts as quickly as possible and try to avoid getting in to debt for things that aren't essential.
7. Install an anti-theft device in your vehicle
Insurance companies are known to offer discounts up to 36% for anti-theft devices, since these have proven to dramatically reduce the risk of theft. This would not only benefit you by keeping your belongings safer, but will also help you save money on car insurance every month.
About our guest author: Diane Johnson writes on different topics, from finance to Rasmussen College. In her free time, she loves traveling and enjoying the outdoors.