Best Practices for Finding Cheap Car Insurance
With money being tight these days, we're all looking for ways to make a dollar and sometimes the best way to make a dollar is to save a dollar. With the cost of auto insurance rising, saving money on car insurance can prove to be lucrative so I've compiled a list of some of the best practices on finding cheap car insurance.
Every insurance company has actuaries who determine rates based on many factors such as age, driving experience, zip code, vehicle, coverage and more. Since each company determines their own rates on multiple factors, there are millions if not billions of rate effecting combinations. These actuaries can never be perfect in determining the exact rate each person should pay so the more you shop around, the more likely you are to find a company that is underpricing your insurance. If you and I were to shop 3 different companies, chances are that the same company will not offer both of us the best rate. Companies also have their niches that they concentrate in being competitive and will often times out price themselves if you do not fall in their desired customer base. Also, competition drives down prices so shopping around will ensure that you take advantage of this.
Combine Household Vehicles
Almost every company will give about a 20% multi vehicle discount if there are at least 2 vehicles on a single policy. Too often, people in the same household, even husbands and wives, will purchase separate policies to better track their expenses. This is just as good as throwing money in the trash because each one will be paying an additional 20% for auto insurance so it is highly recommended to combine policies. Most companies will allow all vehicles raised in the same house to be on one policy even if the people are not related, such as roommates living together.
Separate Household Vehicles
I know, this is the exact opposite of what I just told you above but hear me out. Let's say you have a Porsche, your significant other has a Range Rover and your 16 year old son has a Kia as his first car. If you bought a policy all together the insurance company may rate the highest rated driver with the highest rated vehicle so you'll be paying for your son to be insured on the Porsche even though it never better to separate policies . In this case, it would probably be best for you and your significant other to have a policy for the Porsche and Range Rover and for your son to have a separate liability car insurance policy for his Kia. Please note that your son would not be covered and must be excluded from your policy. You and your significant other could have added to your son's policy which would not cost anything more since the company will rate him on the vehicle since he is the highest risk.
Apply All Discounts
Most insurance companies offer discounts for a variety of things so be sure to ask for a list of all available discounts offered by your company. Actuaries study everything and anything available to them to determine a risk. For example, there is a company that determined anyone with a roadside membership is a much lower risk and they offer a 20% discount for all members. Sometimes you can even take steps to add discounts that you are not even eligible for now. There are also discounts for your profession, your education, your good student and much more so be familiar with the discounts available to you and take advantage of them. Putting together some of these discounts make it real easy to find cheap car insurance.
Get Correct Coverage
The covers and limits you purchase play a big role in your auto insurance premium. Although higher and more coverages are always better and recommended, sometimes you do not need to over insure yourself. If you're looking for cheap auto insurance, do not pay for coverages or higher limits that you do not need or want.