Money Matters: Car Insurance

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May 2nd, 2012

Driving a car is expensive enough with gas prices sometimes spiking upward.

Now add in the added misery of car insurance rates constantly going up, and unlike gas prices which have gone done recently, it doesn't look the upward trend in car insurance rates is going to slow down any time soon. But Glen Curtis with investopedia.com says there are some things you can do to cut your auto insurance costs.

Here are Glen's suggestions.

1. Insure multiple cars and drivers

Most insurance companies offer a bulk rate if you insure more than one car or driver. Usually multiple drivers must live at the same residence and be related by blood or marriage.

2. Keep a clean record

The more accidents or moving violations you have, the higher your rates will be. More points on your license mean you'll pay more for insurance.

3. Take a defensive driving course

Sometimes companies will provide a discount if you complete an approved defensive driving course. Sometimes you can reduce the number of points on your license by taking a course. Check with your agent.

4. Shop around

You might be surprised how much rates vary from one company to another. But remember cheap doesn't always mean good. You may want to check with a ratings agency such as AM Best to make sure the company has the financial strength to pay claims.

5. Take mass transit

The less you use your car the lower your rates will be. If you drive your car to work every day you'll pay more then if you only use the car to drive to church on Sundays.

6. Select your vehicle carefully

Buying a huge SUV will cost you more then a smaller car. And the insurance on a late model BMW will be a lot higher than older Datsun.

7. Consider raising your deductibles

Bumping that deductible from $500 to $1,000 could save you a nice chunk of change. However, sometimes the lower the deductible the higher the annual premium. Check with your agent to get the best deal.

8. Improve your credit rating

Believe it or not, if you have bad credit you may pay more for auto insurance. The theory is people who have trouble paying their bills tend to have more accidents and traffic citations. That may not be true in every case, but that's how auto insurance companies see it.

Other tips include drop unnecessary coverage and install anti-theft devices.

For more information, click the link below.


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