When it comes to reoccurring costs, car insurance ranks high on the list. Most people renew their insurance every year without giving it a second thought. If you shop around, however, you will probably find that you can get the exact same coverage at a substantially lower price. When it’s time for you to renew your insurance, beseech the National Association of Insurance Commissioners to find at least four companies with whom you can get a quote.
If you drive a clunker, get basic liability coverage – as the cost to repair your vehicle could be more than it is worth. Bundling your home, boat, and/or ATV insurance with your car insurance can bring your rates down over 10%. Some agencies offer discounts if you install a device that monitors your driving habits; and if you practice the art of hypermiling, you are sure to get a substantial discount. Lower rates can also be obtained if you have minimal mileage on your vehicle and/or a high credit score.
If you have children who drive, expect to pay over 80% more for coverage. While 16-year-old drivers cause a 96% spike in insurance rates, 19 year-olds only cause a 60% spike; so it might be prudent to make your teen wait a few years before driving. If your child receives good marks in school, inform your insurance company and you could receive a “good student” discount of between 6% and 20%.
In some cases, it is better to not claim an accident. If you file a claim on an accident that you caused, expect your premium to rise over 41%. For minor accidents involving no one else, it is probably best just to pay out of pocket (or live with the damage if it’s purely cosmetic). You might be tempted to file a claim, receive the payout, and leave the damage. But the money pocketed will likely be lost due to higher premiums. And don’t think for a second that changing insurers is a loophole, as CLUE (Comprehensive Loss Underwriting Exchange) reports can be obtained which detail a complete history of your insurance claims. For help deciding whether or not to file a claim, use an online insurance claim calculator.