Saturday, September 29, 2012

Saving on Car Insurance

Saving money on car insurance isn’t necessarily as easy as insurance companies would like you to believe. Although switching your insurance companies could save you money, you may find yourself able to save just by talking to your current insurance company. Even though insurance companies often tout their amazing discounts, that doesn’t mean they’ll automatically kick in - sometimes you really do have to ask for them.
One example is the good student discount that many insurers offer for auto insurance on minors. Usually, insurance companies require proof that a student is performing in school at a certain level before the discount kicks in. That means regularly submitting progress reports and report cards. Otherwise, the discount can lapse, kicking your otherwise good student into a higher insurance rate.
Multiple-line discounts also make up a big chunk of the insurance discounts that matter, but it’s easy to miss some if you aren’t careful. For instance, some smaller insurance companies only offer auto insurance. While these at first glance might seem to be a great deal, cutting 50% or more off your existing premiums, you also need other insurance products as well. You’ll end up having to get these at another insurance company. Homeowner’s, renters, life insurance, boat, RV, motorcycle- getting all these from “cheap” insurance companies means you may be writing several checks in a month, rather than just one or two, and you won’t qualify for a multiple-line discount on any of them.
It’s a much better option to keep all your insurance with one company so that you not only qualify for the multiple-line discount, but that you make your own life a little easier, as well.
Avoiding using your insurance whenever possible is another great, though perhaps rarely considered, way to save. After all, you buy insurance to use, don’t you? Well, not so fast there. You’ve chosen a deductible as part of your insurance agreement, so you know how much you’re going to have to pay anyway. Let’s say for instance that you carry a $500 deductible, and were responsible for a one-car fender bender in your garage that, all told will cost $550 to repair. You might actually be better off paying for the damage out of pocket. Why? For starters, you’re only going to get a $50 settlement from your insurance after the deductible is applied, but you also get a notation on your insurance agreement. Not all companies are the same, but for many, that counts as one “strike” against you. After “X” number of strikes, or claims, your insurance rates will increase because the company will see you as a greater liability. If you’ve had three small incidents, you’ll find that the $150 you had the insurance company pay for damages could cost you well over $1,000 in increased premiums.
Although saving money on insurance may not be particularly glamorous, an occasional re-evaluation of your coverage, and careful use of your insurance can make a huge impact on your budget. You might just be surprised by how much you actually can save.

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