How To Save On Car Insurance

In the increasingly topsy-turvy economy, everyone is looking to save a few dollars on everything from groceries to auto insurance. Auto insurance is required in all but two states in the U.S., although the amount of auto insurance that drivers are required to maintain on their vehicles varies from state to state.  Staying legal on the road is not only important to avoid getting in a legal scruple, but also helps to protect your assets if you were to become involved in an accident and are sued.  Discount auto insurance can go a long way towards getting the protection that you need for your vehicle and assets without paying more money than you have to. 

The amount of auto insurance that you need will greatly affect the rate that you are charged for the insurance, so determining your particular requirements is vital.  In general, if you own your own home or business or if you are still paying on your vehicle, you will need to take out a higher level of auto insurance than someone who has very few assets to protect or whose vehicle is old and not worth that much.  Decide on how much insurance you can get by with according to your particular needs before you go “shopping”. 

Although you can visit multiple auto insurance websites to obtain quotes for auto insurance, the simplest way to compare rates is on a website that allows you to enter your pertinent information once and receive multiple quotes delivered to you via email, phone or traditional snail mail.  By obtaining multiple quotes, you will be able to see at a glance which company offers the best deal for you and then make an informed decision about purchasing auto insurance without second-guessing yourself or wasting a lot of time getting quotes.

You might be able to afford payments on that show-stopping BMW, but do you have the funds for the insurance? Buying a flashy ride means paying a pricey premium.  If you're planning on buying a new car in 2010, consider purchasing a cheaper, safer vehicle. Although Hyundai Santa Fe won't turn heads at a stoplight, it's the cheapest new car to insure. Other factors affecting premium costs include safety features, repair costs, and theft rate.  Want to go cheaper? Buy an older car that's worth less or near your deductible cost and drop collusion. 

To further reduce your rates, always check with possible insurers to see if you qualify for discounts. Discounts may be offered for:

•   Safety equipment installed on your vehicle (like airbags)
•   Theft-deterrent systems
•   Participating in driver’s education or defensive driving courses
•   Being a member of certain automobile clubs like AAA
•   For having good credit
•   For driver’s with an accident-free driving history

Keep in mind that other factors can play a role in the rates that you are charged for insurance, including the type of vehicle that you drive and the geographic location where you reside. Actively seeking out discount auto insurance can save you hundreds of dollars each year over the cost of your current policy if you take the time to research your options.

Dozens of discounts are available for drivers--make sure you're getting everything for which you're entitled. AAA members, long-time customers, multiple-policy holders, safe driving record, age, your car's safety features, even your college alumni are just a few discounts offered. Ask your agent for all discounts available. Save even more money by commuting to work via carpool or public transportation, qualifying you for a low-mileage discount. Not only will you reduce your insurance premium, you'll decrease gas costs, keep your car's mileage low and reduce general wear and tear on your vehicle.

Modify your payment plan: Most insurance companies tack on installment fees when billing monthly. Cut auto insurance costs by switching to a 6-month or 12-month billing cycle. Scared of big bills? Divide your new premium rate by 6 or 12 and place into a savings account bi-monthly (or every month). When the bill is due, you'll have the money available plus interest. Many insurance companies also offer a discount if your premium is automatically deducted from a bank account.

Although it won't help cut your auto insurance costs right away, make a resolution now to clean up both your driving record and credit score and you'll reduce your insurance costs in the future. Insurance companies look at your driving record, including minor traffic violations, to assess your risk and adjust your premium accordingly, but they also view your credit report. A low credit score means a higher premium. Slow down, obey traffic laws, pay bills on time, and you'll see your premium go down in years to come.


With most states requiring drivers by law to carry auto insurance, paying your premium is one agonizing price of driving.  Take a few minutes out of your day to make sure you're getting the best deal possible. Still need an incentive to look into your insurance options? Use the money you save on insurance costs and put it towards something fun, like a vacation or a new computer.