With the gas prices rising higher than Jeff Bridges in The Big Lebowski, the need to save money in every way possible is needed more than ever. The cost of buying a car, maintaining it with all the servicing charges, and the gas prices will make you reach so deep into your pockets, that it might rip it open. While you can do very little to reduce the cost of the car, service, and gas, with some smart steps and practices, you can save a lot on auto insurance.
To get the best vehicle auto insurance policy that fits your needs and does not hurt your wallet, here are some simple steps to choose the best, cheap auto insurance for your budget. Get the most out of your auto insurance and pay the least, this is what you’ll achieve with these steps. Let’s get started.
Liability Coverage – Choose Your State’s Limit
Liability coverage is the most expensive part of auto insurance, and it is mandatory in almost all the states in the US. So there’s no way of avoiding it. But there is one way of reducing the cost. Liability coverage comes with a minimum coverage limit, which is the amount the insurance company will pay in case of an accident.
Each state has its limit. All you need to know is how much the liability limit of your state is and then just keep your liability coverage limit a little more than it. For example, in the state of Louisiana, the minimum limit of liability coverage is 15/30/25 ($15,000/$30,000,$25,000 for various damages in an accident). But many companies will try to sell you a liability limit of 100/300/50.
While you should have liability coverage more than the minimum limit, it does not have to be extravagant. So talk to your auto insurance provider and try finding the amount that you are comfortable with.
Browse Through Different Insurance Policy
Don’t be stuck with the insurance policy that your Uncle Mark uses and he told you to get it because “it’s the best”. The most common reason why people end up paying more for auto insurance is due to the lack of research. Insurance policies are for years, and it would be criminal to not browse through different auto insurance companies and choose the cheapest car insurance provider. With just thirty minutes of research, you can save hundreds of dollars. So why not?
Select or Skip
There is some vehicle insurance that you need, some you want, and some you get for no reason. This is why try to use the “select or skip method” that will help you eliminate the policies that you might not need. For example, collision insurance and comprehensive insurance are very important to protect your car, but if your car is one very old fossil, you don’t need to pay thousands of dollars annually to get it fixed.
Similarly, add-ons such as engine protection coverage, roadside assistance, etc are only worth it when you have a genuine need for them. If not then they are just another way of you losing money. For example, if all you do with your car is the commute to work and maybe a weekend drives around the city. Then what are your chances that your car will break down in some desolate place and you’ll need roadside assistance? The chances are low, so skip it and save more.
Keep a Good Driving Record
This one goes without saying. Having a clean driving record automatically brings down the cost of auto insurance and premium as the company sees you as a low-risk individual. So avoid speeding tickets, traffic violations, DUI, and of course, accidents.
Collect No Claim Bonus
Did you know that if you don’t make any claims for the entire insurance policy period (which is usually one year), you can get great discounts when renewing the auto insurance policy? The discount differs from company to company, but it usually starts at 20% and increases each year as you don’t make any claims. So drive safe, keep your car and driving record intact, and save more. It’s a win-win and win situation.
Switch Policies if Better Ones Come Along
Don’t be stuck with one policy just because it was the best one at the time. Always during the renewal time, do quick research to see if any other insurance policies offer the same coverage or even better at a similar or low price. If you find one, then switch.
Keep Deductibles High
This tip will help you save a lot if you trust your driving skills. A lot of money is spent on auto insurance premiums. But there’s a way to bring it down. Increase your deductibles and this will automatically bring down the premium price. The downside is in case of an accident, you’ll have to pay more from your pocket.
Avoid Dealership Insurance
Many people make the mistake of getting an auto insurance policy from the dealership where they buy the car from. This is not a smart thing to do because dealerships team up with insurance companies and try to upsell you a lot that you don’t need. And while you make the “large” payment for your car, you don’t mind paying a few extra dollars for insurance. But these “few extra” dollars can be saved if you get your auto insurance.
Make Full Year Payment
Once you find the best auto insurance policy for you, you’ll stick with it at least for a year. So why not pay the premium price all at once and save some money? Full payment of the insurance premium usually comes with a good discount. This saves you from the hassle of monthly payments as well.