How to Get the Best Price on Quality Car Insurance

How to get cheap car insurance

We know how much you love your car. We know that you go to great lengths just to give your car the tender loving care that it needs.

Besides the requisite oil change and up-to-date service procedures, we know that you spend copious amounts of cash to modify and improve the appearance and performance of your ride.

But who wants to spend a ton of money on car insurance? Not you, and certainly not us.

No matter what car you drive (it doesn’t matter if you drive a clunker or a beat-up old rag) you should consider getting a decent form of auto insurance. Whether you’re planning to buy a brand new or used car, you need to determine the minimum insurance requirements in your state or locale.

You Need to be a Good Driver

Good dog driverYou don’t need to be a genius prodigy to enjoy the cost-saving  benefits of cheap auto insurance, but you need to be a responsible and safe driver.

Why? If you’re a bad driver, or if you have a less-than-stellar driving record, then you will most likely get higher insurance premiums compared to a driver with a particularly clean driving record.

But your driving record is only a small part of the story.

If you are looking to save money on your next insurance policy, then you should clean your act and consider the following facts.

Here are Some Things to Keep in Mind

Besides having a clean driving record, auto insurance companies will keep an eye on the following:

1. The cost of the car

Generally speaking, if you are planning to buy a more expensive vehicle (or if you are setting your sights on a high-performance car) then you should prepare yourself for higher insurance premiums. Plain and simple.

Why is this so? Well, expensive cars are more expensive to fix. The cost of spare parts and labor will be more costly in a German car compared to a humble Japanese compact.

The same reasoning applies to high-performance cars. Insurance companies are not assuming that you’ll be driving like a lunatic in a Nissan GT-R, but they do know that you’ll be driving it more aggressively compared to, say, a Mitsubishi Mirage.

It’s all about risk management. Hence, the incredible Nissan GT-R may be less expensive compared to premium performance supercars, but it is more expensive to insure compared to the humble Mirage.

Keep that in mind the next time you’re shopping for a new or used car.

2. The safety rating of the vehicle

It’s a known fact that cars with a stellar safety record (or those with a five-star rating for safety) are cheaper to insure. The same goes for cars that have a good reputation for quality and reliability.

The reasoning behind this is relatively simple to understand. Safer cars offer a greater margin of protection in the event of an accident. They can better protect you and your occupants from serious and possibly life-threatening injuries. And this means there are less risks on the part of the insurance company.

Find the safety rating for your car.

3. Pay attention to your credit score

Insurance companies will look into your credit report when you apply for auto insurance, except if you live in California, Hawaii and Massachusetts.

If you have bad credit, and you don’t live in the above mentioned states, then you might be charged with a higher insurance premium compared to a person with good credit.

If this is the case, then you should pay attention to your credit score. Pay all your bills on time, and report any errors in your credit report immediately.

Your Credit Score Matters. Do you know yours? Get Your Free Score Now at Credit Sesame.

4. Where you live

Sad but true. If you live in a neighborhood with a high incidence of crime, theft and vandalism, then you might have to live with higher insurance premiums.

Again, the reasoning behind this is simple: insurance companies consider city dwellers to be more at risk to theft and vandalism compared to people who live in rural areas.

But before you pack up your stuff and head to the nearest farmland, this is a reality that you need to face. The good news is that there is a more practical way to lower your car insurance premiums, and that is..

5. Raise your deductible

This is perhaps the easiest way to enjoy cheap car insurance. What is a car insurance deductible? It is simply the amount of money you need to pay for vehicle repairs before the insurance company covers the rest.

Here’s an example: let’s say you’ve been in an accident, and the damage to your car is estimated to be $2,500. If your deductible is $500, then you only pay that amount and the insurance company will cover the rest.  In this case, your policy will pay $2,000 to get your car running again.

Raising your deductible will lower your insurance premiums. Think of it like a down payment when buying or leasing a car. If you pay a bigger down payment, you enjoy lower monthly payments. The same goes for auto insurance.

Instead of choosing a $500 deductible, simply increasing it to $1,000 will result in cheaper monthly insurance payments.

6. Choose your policy wisely

If you drive an older car, why not skip collision and comprehensive coverage?

Collision coverage will pay for damages caused by accidents.  Comprehensive coverage will pay for the repair of your vehicle in the event of theft, vandalism or acts of God. This is all well and good, but remember that both policies will only pay an amount that is equal to the value of your car.

If you happen to drive an older car with a relatively low market value, then it is unwise to pay more money for collision and comprehensive insurance policies.

Learn about all the different types of car insurance here so you go into your policy shopping informed.

7. Ask for discounts

What you don’t know is that insurance companies offer policy discounts to the following:

  • Low mileage drivers
  • Students with good grades
  • Retirees
  • Insuring multiple vehicles in a single policy
  • Advanced drivers, or those who took defensive driving classes and/or high-performance driving lessons.

According to the Insurance Information Institute, drivers who are over the age of 55 could enjoy lower insurance premiums of up to 10% by simply passing a defensive driving course.

Insurers also offer pay-as-you-drive insurance policies for those who want the lowest rates. The mileage cap for these policies will vary, but the average is around 19,000 miles annually.

8. Shop around

The variables are bewildering to say the least, so your single best weapon in getting cheap car insurance is to shop around.

If you are thinking about renewing your old policy, we strongly advise that you shop around and ask for an online quote before signing on the dotted line.

Your financial needs and capabilities will change over time. The same goes for your auto insurance. In order to enjoy the cheapest rates, you need to compare what other insurance companies have to offer.

Did you know that 1 in every 7 U.S. drivers on the road have no auto insurance? Don’t be a part of that statistic.

Protect yourself and your loved ones without paying too much money upfront. Simply ask for an online auto insurance quote to determine the lowest rates in your area.

In addition to these tips & tricks, it’s important to know what factors car insurance companies use to determine your insurance premiums. Check out our rate factors guide to learn more.