*Disclosure: I was compensated for this post. These are my opinions and yours may differ.*
Reduce Auto Insurance Costs to Save Money on the Family Budget
Commercials for auto insurance promise that you’ll save a ton of money if you go with whichever company is airing its sales pitch. This makes it tempting to call their number, even if they’re not located in your area. Many national carriers boast of lower rates, but you might do better to shop close to home. When looking for ways to save money on the family budget, consider getting local quotes, too.
You Must Shop Around
You cannot rely on advertising or assume that because a company is bigger it is better. If there is one thing all insurance companies have in common, it’s that they want your money. You might think they’re supposed to be there to help you when you get into an accident, but just wait. You’ll be surprised at how happy they are to take your premiums yet how stubborn they are to pay out a claim.
If cutting down the family expenses includes getting a new auto insurance policy, you must shop around. You should get quotes from at least companies, and one of those companies should include a local insurance carrier. The smaller business needs your business, and it may be more willing to offer you the same coverage you can get from a conglomerate at a fraction of the cost.
Consider How Your Deductible Affects Your Premiums
Many people want a lower deductible because they won’t have to come up with as much cash to get their vehicle repaired after an accident. This might work well for those without a savings account but if you’re looking to shave money off the insurance budget now, you’ll want to reduce your monthly, quarterly, or annual insurance premiums. You can do this is by opting for a higher deductible.
When you are willing to pay a higher deductible, the insurance carrier will reduce your payments. This gives you immediate relief on your family budget’s bottom line. If you can set a little money aside once your expenses are reduced, you’ll have it for your higher deductible should the unfortunate occur. Talk with your local insurance carrier about its deductible-to-premium ratio.
Consider Your Vehicles
Whether you drive an older car or are looking to purchase a new one, how you insure your vehicles will affect the overall cost. If you have an oldie-but-a-goodie that is paid off and you want to trade it in for a newer model, reconsider. Most states do not require you to carry full coverage on a car or truck that you own, and if you finance a new one, you’ll have to insure it to the max.
Also look at your automobile insurance riders. For example, if your car is really old and has lost significant value, you might want to drop your comprehensive or collision coverage, because it will cost you more to repair the car than what it’s worth. A good rule of thumb is to calculate at what point your comprehensive coverage is more than 10 percent of the current value of your vehicle. When that happens, you can think about changing to liability coverage if the car is paid off.
These tips will help you save money on your insurance costs. The more you reduce them, the better it looks on the insurance line of your family’s budget. Shop around and save today.