After embracing a break at the height of the pandemic, motorists in the U.S. are bracing for a rise in auto insurance premiums. According to a recent analysis by Bankrate, the average car insurance rate currently stands at $1,655 a year. Experts warn that rising inflation and an increase in road accidents will likely push premiums higher. With insurance rates set to rise across the industry post-pandemic, here are some tips on ways to save on auto insurance.
This situation has prompted drivers to search for ways to lower their insurance premiums. Here are a number of ways to cut auto insurance costs, recommended by Insurance Business.
- 1. Compare auto insurance rates
Each driver’s profile and circumstances are different, which means there is no one insurance company that is best for everyone. Also, often insurance company rates can vary significantly state to state. For example, State Farm may offer a customer the best pricing in Illinois, but not in Pennsylvania. Work with a broker who will take the time to shop many different companies for you.
- 2. Take advantage of discounts
Auto insurance providers offer a range of discounts, which can help reduce annual premiums. Drivers can often benefit from these through:
- Bundling of auto policies with homeowners or renters insurance
- Maintaining a clean driving record
- Paying premiums in full instead of monthly installments
- Insuring multiple vehicles in a single policy
- Taking defensive driving courses
- Maintaining good grades for students
- 3. Skip the coverage you do not need
Auto insurance providers offer a range of coverage options that impact how much premiums will cost. Some companies offer disappearing deductibles or loss forgiveness features that result in additional premium – and are not useful if you do not have a claim.
- 4. Keep a clean driving record
Maintaining a clean driving record is among the best ways motorists can access affordable car insurance rates. Safe drivers prove to auto insurance companies that they are not at high-risk for getting into an accident, meaning they will most of the time be less expensive to insure. Safe driving discounts vary between insurance companies, but can access between 10% and 25% reduction in premiums for adopting safe driving behaviors.
- 5. Consider raising your deductible
A higher deductible means motorists will pay lower premiums. This also increases the amount they need to pay before their auto insurance picks up the tab in the event of an accident or theft.
If you’re not sure which deductible is best for you, check out our blog post How to Choose your Car Insurance Deductible.
- 6. Check out the insurance costs when buying a car
Some vehicles are more expensive to insure than others. Top-of-the-line vehicles can be more expensive than insuring small lower-cost vehicles. There are many factors that effect the cost of insuring a specific vehicle, including by not limited to: statistics on how many of that model are in accidents each year,
- 7. Shop around when it’s time to renew
Car insurance rates change often so that companies can stay competitive and get new customers. Your insurance policy should be reviewed annually to make sure you have the most competitive rate. It’s important to note that it helps to have longevity with an insurance carrier, and when you do shop you’ll receive a lower rate for the length of time you’ve been with your most recent carrier. A good insurance broker will keep an eye on your rate from year to year to make sure your rate is still competitive.
- 8. Maintain a good credit rating
In many states, insurers use a person’s credit score in calculating premiums. Some insurers say studies show a correlation between a driver’s credit rating and the chances of filing claims.
If you aren’t sure you have the most competitive rate, or for more information on how you can save on your insurance give us a call at 724-575-7237.
Source: Insurance Business America