Reducing the cost of car insurance
Car insurance can be one of the most expensive aspects of having a car. You do have a little control, however, so try the following to reduce your rates:
- Do well in school. If you maintain above-average grades or are in the top 20% of your class, you may be able to reduce your premium. Ask your insurance agent for details.
- Drive safely. Most insurance companies give discounts to drivers who have had no accidents or tickets in the last three to five years
- Don’t drive much. Some insurance companies charge less if you drive less. For example, a company may charge you lower premiums if you commute less than 30 miles a week.
- Buy a low-risk model. Collision and comprehensive coverage may be reduced by a substantial amount if you buy a new or used car that is at lower risk for damage or theft. Get quotes on the top two or three car models you're considering and compare.
- Buy your renter's insurance from the same insurance company. Many insurance companies give discounts when you buy both your auto insurance and renter's or homeowner's insurance from the same company.
- Tell your insurance company if you've reached a “milestone” age. Depending on your insurer, you rates will go down when you reach an age between 25 and 30 years old, as long as you have a good driving record.
- Ask about other discounts. Some insurance companies give discounts for degreed engineers or teachers, persons in the military, or those willing to buy via the Internet. Don't be afraid to ask what other discounts might apply to your particular situation.
- Compare rates. It pays to shop around. You can get free quotes for car insurance online. When comparing rates, be sure to compare service and what is covered—not just the rates.
- Maintain good credit. Most insurers use credit information to create an "insurance risk score," which is used to help determine your auto insurance rate. The idea is that there is a correlation between your insurance risk score and the likelihood that you will file a claim. If you have poor or shaky credit, be prepared to pay a higher premium than your buddy who's the same age and has the exact same model car.