I won’t say that I’m an expert in all things insurance – but I’ve spent enough years in the business to be able to give some expert advice. My main objective in my job as an insurance agent is to help people get the right coverages for them (what they need) and try to save them money in the process.
The first thing, before I go into my tips for saving money on car insurance, is to let you know that cheaper isn’t always better – especially when it comes to insuring your assets. I would highly recommend you do your research on a no-name insurance company before buying into what they are selling. Generally speaking the “if it’s too good to be true, it probably is” rule does apply, though many companies can save you hundreds (and sometimes even thousands) on your policies with similar coverages. Just like anything else, make sure you are a smart consumer!
Find a Trusted Agent. I know the stereotypes that are out there about insurance agents – will sell you things you don’t need just to make a buck, pocketing your premiums living it up in the world while your struggling – I get it. But not all agents are like this; most, like me, are in this job to provide you with an education about insurance coverages, we make suggestions on what we think you should do based on our professional opinion, and then we leave it up to you to decide what you want. Most trusted agents will never be high pressure – yes we may have you sign forms stating that you agreed to certain coverages, or that you declined something that we recommended – that is for our protection, as well as yours. If you call or visit an agency for a quote and you don’t vibe with them, or feel that you trust they are being honest, then leave. An agent can be your biggest advocate during a hard time, or claims process.
Watch Your Credit. Besides a good driving record, a good credit rating is the second biggest rating factor in insurance rates. Believe it or not this does go hand in hand – actuary studies show that those with a lower credit score tend to turn in more claims then their counterparts. If you really want to get a good deal on car insurance, work on your credit!
Call Before You Buy a New Car. I cannot even tell you how many people who have been in completely shock, and utter disbelief over a premium on a vehicle they just purchased – you should never ever ever ever purchase a vehicle without first checking what the premium will be with your insurance agent. You may find a ‘cheap’ car that will cost you more in insurance premiums than if you would of purchased the more expensive vehicle. I have seen big SUV’s and trucks have lower premiums than a small sedan. When you call in let your agent know as many details as possible (having the VIN # is best) and what coverages you need. That way you can fit the car payment and insurance premium into your budget.
Go Paperless. I know a lot of people who prefer to have a paper bill each month, and mail it in with a paper check, in their paper envelope with a paper stamp (they are paper right?) anyway, not only does this cost you more, it cost the companies more as well. If you sign up for paperless billing and renewals, you can save quite a bit, usually up to 10% with most carriers.
Auto Payments. I know for some this can be a struggle – but setting up automatic payments can save you not only a billing fee for most companies, but also a set discounted amount as well. When insurance companies know they won’t have to chase you down for your payment before your policy cancels (Which cost the company even more) they will give you a discount for it. I know that having money coming out of your checking account can get scary, so use this tip: Set up a separate savings account for auto withdraw bills. Transfer money to that account to cover those bills, and then you don’t have to think about it. No worries if it’s came out yet when your trying to balance your checkbook, and no worries that it was ‘accidentally spent’.
Pay in Full. Believe it or not you can have a substantial discount for paying your insurance premiums in full. If you can afford it, I suggest that you have this set up. Most companies will send you a billing statement 20 days prior to the due date so you can prepare.
Sign Up for Safe Driver Monitoring. This was a debate in my Facebook feed a few days ago – “WELL THAT’S AN INVASION OF PRIVACY!”, or “I don’t want my insurance company knowing everywhere I go!” – I hate to break it to you, but if you have a smart phone, it knows a lot more about you than you realize. Since insurance companies are regulated by the state insurance departments we are very regulated on what we can and cannot access via these devices. Most do NOT include a GPS – they are literally just monitoring to give discounts – they are not allowed to use the data to increase your rates, though you may lose a discount for not being what they consider a ‘safe driver’. Some companies will give you up to 30%* based on your driving habits. Definitely worth a try – if you don’t like it, then remove it for your next policy period.
Kindly Ask. There’s an old saying that goes, “you get more bees with honey, than vinegar’ and this is true when it comes to dealing with anyone who works in customer service. If you always call ranting and raving and yelling about the rate increase to a rep – who by the way has no control or say over the rates whatsoever – they are not going to go the extra mile to help you. Be kind and ask if there is anything that you are missing because you really are just looking to save money so you can pay for Billy’s baseball glove, or Sally’s dance classes. Be real, be kind – it will take you far. Sometimes there are other companies or newer policies that might give you a better rate than the one you are in – and if you aren’t nice about it, we aren’t going to offer it up. It doesn’t hurt to ask, though we can’t always help you all the time, we will remember you. You will be one of the first we contact when we have a new way for you to save.