Car Insurance Rates: What You Can Do to Save

All drivers are required to carry at least the state minimum liability insurance in order to stay legal on the road.  Some drivers choose to carry more than liability insurance and may opt for full coverage auto insurance, uninsured motorist protection, PIP insurance, or a variety of other types of auto insurance coverage.  Car insurance rates vary widely from company to company and from policy to policy.  We all want get the best deal for our dollar, but how do we know if we really are?

Right now in the current recession all of us are tightening our belts and trying to cut financial corners, but you need to be very careful when you are cutting corners on your insurance.  It is possible to cut your car insurance rates by carefully selecting which insurance company to use.  Putting your requirements through a comparison web site can yield great savings on your car insurance rates as it lets you compare insurance quotes from multiple companies at one time.  Sometimes choosing the company with the cheapest rate isn’t always the best idea. You want to make sure that when you get in to an accident, your auto insurance company is willing to pay up.

One way to reduce car insurance rates is to look at raising your deductibles in case of an accident.  On virtually all policies the policyholder is responsible for paying the first amount of any claim.  This can be anything from $100 and up depending on the insurance company.  You can choose to increase this to say $500, and by doing so you reduce the cost of the policy.  As the deductable goes up the premium goes down.  This is worth considering because the actual likelihood of having an automobile accident is not really very high and you could save a lot of money.  Just make sure that you do not pick a deductable that you could never meet if there was a claim.

Insurance companies play a percentages game, and that is what your car insurance rates are worked out on.  They work out the chance of you having an accident based on your driving experience, age, gender, where you live and a host of other things.  The lower they see the likelihood of you causing an accident – after all they can’t estimate what everyone else is going to do – the lower the car insurance rate they will charge. 

It is always worth looking at ways to reduce the perceived risk to reduce the cost.  An advanced driver’s course may be one way to reduce your premium, and it could also benefit you in other ways, using less fuel for instance, and make you a better safer driver along the way.