Auto Insurance: Reducing Your Costs

Although a variety of factors, including the state you live in, determine how much a typical driver pays, you may nevertheless be able to reduce your costs. To give you a better understanding of what goes into insurance prices, we list some of these factors below, followed by some tried-and-true ways to save.

Factors that Affect Costs

There are a number of different factors that influence what you end up paying for car insurance. Depending on these factors, your rates may fluctuate. For example, you can get better rates by driving for an extended period without accidents or tickets. You may also qualify for lower rates simply as you get older and have more driving experience. Age and experience are among the multiple factors that determine auto insurance costs. These broad-based underwriting criteria include:

• Age and gender

• Marital status

• Years of driving experience

• Coverages and deductibles

• Type of vehicle

• Location of vehicle (state)

• Whether the vehicle is used for work or personal transportation

• Driving record

• Claims history

• Credit history

• Previous history of insurance coverage

Ways to Save

It’s possible to save money on your car insurance simply by being proactive. You should constantly check for discounts, compare different rates online, and look to take advantage of other excellent opportunities that may be available. There are discounts for education, good driving, or even installing safety equipment. You could get savings by doing any of the following:

• Insure more than one car

• Maintain a good credit rating

• Get good grades (if you’re a student)

• Take advantage of low-mileage discounts

• Increase your deductible

• Drop collision coverage on older cars worth less than 10 times the premium

• Install anti-theft devices

• Take defensive driving courses

• Remain a long-term customer

• Have no moving violations or accidents in three years

Insurance costs can fluctuate for many reasons. When you take charge of your coverage, you can identify what things may help you save. That’s why it’s important to shop for insurance, research any available discounts, and let your agent know that you may qualify for lower costs. Keep these tips in mind when it’s time to renegotiate your premiums or shop for new auto coverage.