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Cars are necessities for most Americans, which makes car insurance a necessity also. By the time you add up car payments, gas, repairs, and insurance, many people are spending $500 to $1,000 a month on a vehicle. With that much expense, it’s no wonder people are looking for ways to save money on car insurance. Here are 4 key savings opportunities you might not have considered.
It’s easy to forget about car insurance costs when shopping for a vehicle. Many new car owners get a shock when they find out how much their new car increases their insurance premiums. Before choosing a vehicle, check the insurance costs. There are many insurance cost comparison tools available online. Small SUVs are amongst the cheapest to insure. Also, avoid two doors, convertibles, and sports cars if you want low insurance rates. Even the color matters. Conservative white is less to insure than flashy red. Much of the cost also comes down to the value of the vehicle. New cars have a great smell, but their insurance costs can have you plugging your nose.
Insurance companies all seem to have hilarious commercials these days, but they all have vastly different plans. Some companies favor older drivers. Some favor those with good credit who own homes. Some offer not-too-stratospheric rates for sports cars, others offer a rate meant to encourage you to go elsewhere. With all these factors, it is important to get an insurance quote from at least 3 to 5 insurance companies. Focus on the ones that cater toward your age group, vehicle type, and driving record. Even if you think you are getting a good rate now, getting quotes from a few other companies can be eye opening. Often big savings are just a price quote away.
Can you afford a higher deductible? If you have enough cash to handle a $1,000 deductible, you can save on premiums. Odds are on your side that premium savings will outweigh any future deductible cost increases, but be careful not to take a deductible you cannot afford.
This may sound a bit big brother to some, but many drivers are finding that usage-based insurance saves them big-time cash. These plans require you to place a telematics device under your steering wheel. It records how much you drive, when you drive, and even if you slam on the brakes. If you are a careful driver who spends little time behind the wheel, the savings can add up; however, if you’re a road warrior who speeds through traffic, usage-based insurance won’t be much help.
With the high amount of competition in the auto insurance market, lower rates are widely available. Insurance companies are constantly having to offer more discounts and lower rates to attract new customers. Many also provide rate decreases and discounts to existing customers. If you have yet to shop for car insurance this year, you are likely to find attractive options by getting quotes.