4 Tips For Inexpensive Auto Insurance

There’s no getting around purchasing auto insurance if you drive a car. Not only is car insurance required by law, the cost of being in an accident can quickly surpass the amount you pay for insurance premiums. How much you pay for car insurance is determined by several factors, many of which are in your control. To get the most inexpensive auto insurance possible, you must first know what discounts are available and how you can take advantage of each to lower your monthly premium. The following discounts are not always mentioned by the insurance company.

It Pays To Be A Good Student

Car insurance premiums are higher for young and inexperienced drivers. Students who maintain a B average can receive a good student discount from most major insurers. In addition to the good student driver discount there are also discounts available for college or university graduates. By taking advantage of these discounts students can offset some of the costs associated with being a new driver.

Your Credit Counts

We all know the importance of having good credit. The benefits of managing your money well go beyond interest rates on credit cards. Insurance providers can and will view your credit score and base their rates on the information they find there. If you have good credit you will see better rates than those who have managed their finances poorly in the past.  I recommend using annualcreditreport.com to get a free copy of your credit report.

Customer Loyalty

There are certainly benefits to shopping around for the best policies, however there are also benefits to sticking with your current provider. Insurance companies look favorably on customers who remain loyal by offering lower rates. It’s also smart to bundle all your insurance policies with one provider whenever possible. If you have your auto and home owners insurance with the same company you will likely be rewarded with a discounted rate, usually called a multi-line discount (warning, but these discounts aren’t always the best deal!).  As an example, I saved 10% off both my homeowners and auto insurance policy by using Allstate for both policies.

Safety And Usage

Safe drivers are rewarded with lower insurance premiums. This makes sense considering drivers who do not get in accidents cost less for the insurance company to insure. Another factor that will reduce your insurance bill is the type of car you drive and how often. The lower your annual mileage, distance to work and safety features on your car will reduce how much you have to pay in premiums.

The best way to get a great deal on car insurance is to simply ask your insurance provider what discounts are available. Take advantage of those you qualify for and consider what you can change in order to qualify for the others. The money you save on car insurance can then be used elsewhere in your budget to achieve other financial goals.