Ways to Cut Car Insurance Premiums (notes from a podcast)

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Ten Ways to Cut Car Insurance Premiums from Money Girl:

  1. Carefully assess and don’t pay for what you don’t need. Older, paid for car (or lots of savings) then reduce or drop collision and comprehensive coverage. Buy these coverages if the annual premium is 10% or less of your car’s bluebook value otherwise you would pay more in premiums than you could ever collect in benefits. If you still owe on your car then do not drop or cut collision or comprehensive coverages. You need savings for that added risk. Keep high auto insurance liability coverage so they can’t go after your assets if someone sued you from an accident.

  2. Get familiar with potential discounts thru your insurer and see if you qualify. Examples: multi-vehicle, safe vehicle (brakes, air bags), safe driver, good student (high-school or college age); occupation discount for working in a certain field; autopay discount. Loyalty discount for consecutive years. Homeowner discount. Association discount for being in diff organizations.

  3. Take a driving course. Many companies give a discount if you have ever taken a defensive driving course. Education discount. Online or local.

  4. Bundle policy with same insurance company. Multi-line policy. Can cut by 15% depending on the company. But, also, shop your policies separately for best deals.

  5. Save while you drive monitoring, usage base insurance, if you meet their metrics then you get the discount. They say they won’t increase your premiums if you are not safe driver. Ask about that!

  6. Increase your deductible. Choose $200, $500, $1000. Higher the deductible the lower the cost but varies greatly state to state so get exact quotes before changing. Keep cash to cover that deductible in bank.

  7. Maintain good credit. People with bad credit pay double or triple what others pay.

  8. Consult with agent. Straightforward. Have a discussion with your agent. They want to keep you! Let them review your discount list with you, etc.

  9. Get quotes from an insurance broker, an independent broker rather than an agent working for one company.

  10. Shop your policy regularly. Rates change all the time based on insurance company stats.

Insurance background from the podcast: everyone should have non-owner auto insurance. Car insurance went up 20.6% in the last year, prior year increase was 18%. You can adjust based on your needs and based on what your bank requires. Most important is liability which pays for legal obligations if you are at fault. Mandatory amount is usually way too low: liability coverage covers different types of liabilities. Collision is optional, covers damage to your vehicle regardless of who is at fault. PIP (personal injury protection) accident-related expenses regardless of who is at fault. Optional in some states, required in others. Uninsured or under-insured motorist from a hit and run or someone else is to blame but they have too little insurance to cover your loss. In that case, this pays the difference. Also, medical coverage for medical bills regardless of who is at fault but doesn’t cover as much as PIP. There is also rental coverage if you need a rental car while repairs being made to your car. Glass replacement coverage for windows and headlights with no deductible. New car replacement coverage pays for your vehicle if your car is totaled if there was a difference due to depreciation, also called GAP coverage, asset protection. Roadside assistance coverage. States and lenders have different requirements. You control your record, credit, make/model, mileage. You don’t control you gender, marital status, years of driving, etc.

If you want to hear the 20 min podcast for yourself, scroll down for the link below…[Money Girl] 10 Ways to Cut Car Insurance Premiums #moneyGirl. https://podcastaddict.com/money-girl/episode/172079064 via @PodcastAddict

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