Your Comprehensive Guide to Lowering Car Insurance Costs
One expense of car ownership that is out of your control is car insurance. But how much is car insurance per month? Looking at the many factors that influence car insurance rates can help you make wiser choices when buying a car, securing car insurance, and potentially pay less for car insurance. So, what factors go into your car insurance premium? How do insurance companies determine your insurance rate? Are there ways you can lower your insurance cost? All these questions will all be answered in this guide.
Understanding Car Insurance Rates
The price of car insurance fluctuates because there are many things that contribute to the risk an insurance company takes when it decides to insure a driver. Many of these factors include:
Driving Record: If you have a clear record behind the wheel, you can expect lower premiums from your insurance company. However, don’t be surprised if you get charged higher rates if you’ve been into accidents or have received speeding tickets at the hands of the law.
Age and gender: Younger drivers such as teenagers are more likely to be charged higher than others because they are likely to initiate an accident as they are less experienced in driving. It is also discovered that more male drivers are largely involved in motor accidents than females which would affect insurance rates.
Type of car: The type of automobile you own can factor into your insurance prices. Your insurance company could be looking at what the car is worth, if it has any particular safety features, and if the car is at risk for theft or vandalism.
Location: Your insurance rates can be affected by location, specifically to the extent that your home will be impacted by where you drive every day. Your rates will be higher in cities with higher traffic congestion and crime rates than in rural areas.
Coverage Requirements: The higher the coverage you choose, the more you will end up paying on your insurance. While liability coverage is the legally required minimum, adding collision and comprehensive coverage will come at an additional cost.
Credit Score: In some states, your insurance company may use a credit-based insurance score to set your rates. The higher your credit score, the lower your premium.
Strategies to Lower Insurance Costs
Although insurance on your car is mandatory, you need not follow a particular route to get the best terms in your insurance premium. There are various ways to decrease your insurance premiums.
Shop Around: Get quotes from several insurance firms to see which provides the lowest price. Premiums are calculated differently from one provider to another and even if you have a spotless driving record, some providers will charge you twice as much as others.
Buy Policies Together: Want a multi-policy discount? Bundle your car insurance with a homeowners or renters policy.
Raise Your Deductible: This reduces your premiums a bit, but you will have to pay more upfront in an actual claim.
Stay Safe: No accidents will save you money over time in reduced insurance premiums; and no traffic violations will prevent you from earning safe driver rate discounts.
Shop Around for Discounts: Many insurance companies offer discounts on a variety of things: safe driving, taking a defensive-driver course, installing an anti-theft device to your vehicle.
Usage-Based Insurance: Some major insurers now offer usage-based insurance (UBI) programmes that track your driving habits through the use of telematics devices. There are some companies that will reduce your rates due to good behaviour. If you have a clean record, you may get a discount based on driving patterns.
Conclusion
Based on a number of considerations, car insurance is always going to cost different people different amounts of money. There are a number of things that cost more and decrease the price that an insurance company is willing to offer, but if you figure out how to take advantage of everything you can, you can get what you need without breaking the bank. Remember to shop around, get multiple quotes, and take advantage of any discounts that could bring your car insurance price down even lower.
