No matter how much of a necessity insurance is, paying those high premiums definitely hurts. Here are some ways to reduce your insurance payments without compromising on coverage.
The price of your car insurance premium is decided by a range of factors including the type of car you drive, how you drive it, when you pay and even your age. Managing these factors correctly can help decrease the price of your premium.
Tips that can help drive the price of your premium down
Chances are that you won’t use your insurance for years until that one difficult day when you’ll be glad to have it. Here are a few ways to help keep your premiums affordable through the years –
Renew your insurance annually
A lot of people find it more convenient to pay their insurance on a month-to-month scheme, but this comes with additional interest payments. When you pay an annual sum, even though the amount is quite large, it can help you to save in the long run.
Raise your excess fee
The ‘excess’ fee is what you pay to your insurer every time you make a claim. The basic amount is compulsory, but if you raise the excess, this could reduce the rate of your premium. This is something to try only if you are sure you will be able to afford the higher excess each time you make a claim.
Try to get the no-claims reward and low mileage discounts
Your insurance amount is influenced by the history of your insurance claims. If you have no claims for a certain number of years (check the time period with your insurer) then you will be eligible for a hefty bonus.
Similarly, some drivers who have a lower mileage count than average are offered discounts by certain companies. If you carpool to work, you may fit the criteria. When you’re looking for reduce insurance, remember to factor this in.
Which car do you drive?
This is an important factor in deciding the cost of your premium. Cars that are more expensive and have parts that are more expensive to replace will raise your premium. Trading in your sports car for a low-risk model would definitely impact the cost of your premium.
Start shopping for insurance early
You don’t have to wait until your current insurance runs out to look for a new plan. Start your research early and switch before the renewal date. Starting a new plan about three weeks before your policy ends can offer you substantial savings.
What’s in a job title?
One factor that plays a significant role in the cost of your premium is your job title. For example, football players pay a very high premium. We’re not suggesting that you lie about your job title, because this would invalidate your insurance, but if there’s wiggle room that would reduce your costs, take it.
Agree to install a black box
Safe drivers get to pay a lower premium than those who are considered to be ‘risky’ drivers. Typically, young drivers are charged higher premiums for this reason. To prove that your driving is safe, you could agree to have a telematics device installed in your vehicle. This will record your driving and your insurance will be adjusted in accordance with your performance.
Add an experienced driver to your policy
This is something that younger drivers can benefit from. Adding an experienced driver to your policy can reduce your premium, as the overall risk is reduced if an experienced driver also uses the same vehicle.
Don’t be afraid to switch insurers
Most insurers don’t offer loyalty points, so rather than accepting the renewal quote, you can use a comparison website to shop around for better deals. You could also ask your current insurance company if they can offer you better pricing for your premium. Spend a little time shopping around before your current policy needs to be renewed.
Maintain a good credit score
Your credit record is checked independently by your insurance company and this also plays an important role in deciding the rate of your premium. To maintain a good credit record, pay your bills and credit cards amounts on time, keep your credit balance low and, as far as possible, don’t ask for more credit than you need.
Have your home and car insured together
Many companies offer discounts when you buy multiple insurance policies from the same place. Check to see if you can find good deals to cover your home and your car together, or if you can insure both your cars in the same place.
Are you eligible for group insurance?
If you get your insurance through your employer, an alumni group, or an auto group, you may be eligible for a discount on your premium. You should check with your employer or any groups you are affiliated with to see if you could be eligible for group insurance.