A great way to save some money on your car insurance is to cut costs where you can without compromising your safety.
Many people approach the purchase of car insurance incorrectly. Many times they would buy it in a piecemeal manner, getting a little of this and a little of that. Sometimes they are over-insured in some aspects and under-insured in the important things. Then a major claim happens and they find that they do not have adequate coverage. There are certain things that anyone buying auto insurance should keep in mind before signing the dotted line.
First of all, studies have indicated that most motorists do not have adequate coverage for lawsuits. The most common limit of coverage for lawsuits is $100,000 per passenger, which will not even be enough to pay for the medical bills in the event of an accident. The recommended minimum liability coverage per passenger is between $500,000 and $1,000,000, more if you’re able to pay for it. If your liability coverage is inadequate, you should make the necessary adjustments with your insurance carrier.
When you re-assess your liability limits on your car insurance, do not stop there. Consider raising the limits on your other insurance coverage like your home, boat, cabins, etc. You would want to have the same level of protection against lawsuits as you cannot tell where the accident will take place.
Another thing to check is your coverage for uninsured and underinsured motorists. It is estimated that between 10 to 20 percent of drivers are either uninsured or underinsured. Your coverage for this particular risk should be equivalent to your liability coverage. Statistics show that uninsured and underinsured drivers have poor driving records. You and your loved ones must be properly compensated when you figure in an accident with an uninsured or underinsured motorist.
You can save a lot of money by opting not to be covered for comprehensive and collision if your vehicle is an old model and if you feel that you can comfortably pay for repairs and parts replacement on these vehicles. You have to make sure though that you can afford these repairs and parts replacements.
You can also save money by self-insuring the minor losses you incur in your car. This is especially true if you have a big deductible. You not only save money you also keep your claim history clean. Reduce the number of your small claims on your policy and keep your premiums manageable.
Today, most if not all auto insurance providers are offering their products online making it easier for consumers to shop for the policy that would meet their needs. Consumers can also get premium quotes online without having to purchase a policy. The availability of auto insurance over the Internet has also caused an increase in the number of consumers who are switching to a different insurance provider. A study conducted in 2012 revealed that 21 percent of consumers in the U.S. shopped for auto insurance the previous year. It also said that 43 percent of consumers switched to a new carrier and 81 percent of them cited premium costs as the reason for switching. About 34 percent of shoppers obtained a minimum of three premium quotes before deciding on which policy to buy, suggesting that people nowadays do their homework and are serious about obtaining the best coverage for them.
Many insurance companies charge a penalty if you terminate your policy with them mid-term. It would be best to wait a few weeks before your policy expires before shopping around for a better deal unless there are significant savings to be gained from switching to another policy mid-term. You should also allow for some time that your new coverage is in effect before canceling the old one so that you are sure there is no gap in your coverage.
A great way to save some money on your car insurance is to cut costs where you can without compromising your safety. Many people working together organize carpools when driving to and from work to save on gasoline and bring down the risk of figuring in an accident. Premium costs are lower if you pay them annually instead of monthly. There are special discounts for drivers who have taken a class on defensive driving.
If you have a home and you have more than one vehicle, you can also realize savings by bundling your coverage for your home and vehicles. Insurance companies offer discounts if you purchase all your insurance needs from them. Of course, you still need to go over the plan features and the coverage to identify gaps and be able to plug them with special riders or supplementary coverage.
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