Money Saving Tips for Auto Insurance!

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Written by FrugalTrader on Mar 28, 2007 filed under Saving Strategies

It’s been a while since I’ve posted a money saving strategy, this time around we’re going to discuss how to save money on the dreaded auto insurance! I’ve been utilizing these tips below when insuring my home and our two vehicles.

Increase Your Deductible
- The deductible is the amount of the claim that you are willing to pay.
- If your claim is $2000 and your deductible is $500, you will pay $500 and your insurance company will pay $1500.
- Increasing the deductible from $500 -> $1000 can reduce your premium by 5%-10%.
Insure your Home and Automobile with the Same Company
- Buying your home and auto insurance policies with the same company will give you a discount on BOTH policies. Sometimes up to 10%.
Insure all Vehicles under the Same Policy
- If you have multiple vehicles, placing them under the same policy can save you up to 10%.
Buy a Car that Costs Less to Insure
- Be sure to get insurance quotes on the vehicle that you are planning on purchasing.
- You can get free comparative quotes online at: Kanetix
Shop the Insurance Market
- Coverage may be pretty standard in your province, but premium differences can be vast. Make sure to shop around by getting quotes from multiple companies.
Follow the Speed Limit
- Not only can speeding tickets be costly, they can jack up your auto insurance premiums also! (Perhaps I speak from experience?)

Those are my top 6 ways to save on auto insurance! Feel free to add any tips that you may have for reducing your auto insurance premiums in the comments.

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17 Comments, Comment or Ping

1. Mr. Tippy

I personally believe insurance should be used for something that could financially destroy me.

My car cost $5000. I don’t have any collision or comprehensive coverage at all. Why? Because although a loss of $5000 would hurt, it wouldn’t wreck my financial situation. Liability is a must have though - injuring or killing someone would cause major financial problems.

Having only the coverage needed saves a lot of money, and I have a feeling many people are overinsured.

Mar 28th, 2007 @ 9:12 am
2. peter brieger

I choose to lower my deductible for two reasons

1/ i get in one accident a year
2/ i don’t want to pay 1000 i’d rather pay 500 if i could.

so in my situation it makese the most sense

Mar 28th, 2007 @ 9:17 am
3. Mike

Peter if you get into one accident a year then you shouldn’t be driving!

Mar 28th, 2007 @ 10:29 am
4. canadiandollars

hey FT:

A few others to consider:

Maintain a Good Credit Record

Establishing a solid credit history can cut your insurance costs. Insurers are increasingly using credit information to price auto insurance policies. To protect your credit standing, pay your bills on time, don’t obtain more credit than you need and keep your credit balances as low as possible. Check your credit record on a regular basis and have any errors corrected promptly so that your record remains accurate.

Take Advantage of Low Mileage Discounts

Some companies offer discounts to motorists who drive a lower than average number of miles a year. Low mileage discounts can also apply to drivers who car pool to work.

Ask about Group Insurance

Some companies offer reductions to drivers who get insurance through a group plan from their employers, through professional, business and alumni groups, or other associations. Ask your employer and inquire with groups or clubs you are a member of to see if this is possible.

Seek Out Other Discounts

Companies offer discounts to policyholders who have not had any accidents or moving violations for a number of years. You may also get a discount if you take a defensive driving course. If there is a young driver on the policy who is a good student, has taken a drivers education course or is at a college out of the area without a car, you may also qualify for a lower rate.

cheers,
CD

Mar 28th, 2007 @ 11:02 am
5. Blain Reinkensmeyer

Great post Frugal! Auto insurance has never been my thing, and I can already foresee these tips helping down the road :p

Mar 28th, 2007 @ 11:50 am
6. FrugalTrader

Hey CAD$

Thanks for the tips, I didn’t know about the credit record tip, i’ll have to look into it.

FT

Mar 28th, 2007 @ 12:37 pm
8. hard2insure

I have to agree with Mike, about Peter.
Once accident a year is way too many, especially if you’re looking to save money on car insurance. If you have a crap car, liability is all you need, but with a nice new car than you’re going to need a lot more, but it also depends on what you as individual can afford if and when you do have an accident.

Jun 1st, 2007 @ 1:07 am
10. Cannon_fodder

Last year our insurance company offered us an option to pay $50 for protection against premium increases should either car be involved in an accident claim.

We only took it on the one vehicle and sure enough, we had the slightest of ‘accidents’. Frankly, I think the other driver was looking to scam my wife because the way it was described there should have been no damage to a 1 km/h bumper to bumper hit.

Anyway, our premiums went down this year and that $50 was probably the best $50 for insurance on insurance we’ve ever spent.

Oct 27th, 2007 @ 2:23 pm
11. Bhasi Basandra

I like the idea to get more deductable in collision and comprehenceable compare to less. It is right to have more deductable because driver save money if he is not at fault. Even if he or she is at fault extra would not effect him or her. It is because he is alredy saving some money from insurance. Think yourself.

Dec 6th, 2007 @ 12:34 am
12. Louis

If you’re in BC and have auto insurance through Canadian Direct, you can save 10% on collision coverage by enrolling in a discounted collision avoidance course. So you save on insurance and upgrade your driving skills.

http://www.canadiandirect.com/More_Ways_to_Save.aspx

Dec 30th, 2007 @ 6:00 am
13. sharebear99

If you car is worth more than $2000 I believe it is important to have comprehensive coverage.

The rate reduction would be about $100 a year if you opted for collision instead. The slightest damage on most cars will cost more than a $100. Even if you are a good driver, the chances are that the guy besides you is not.

We have had a record breaking snowy winter. There have been more accidents than in past years.

Mar 20th, 2008 @ 8:57 pm
14. keko

Insurance Companies want you to buy two Million in Liability ,I would appreciate comments on this?

May 8th, 2008 @ 10:24 pm
15. Super_Eleni

My tip is to call your insurance company every few months and see if they have any new discounts you may qualify for.
Recently I called them up to get a few quotes on cars I’m considering buying, and while I was on the phone with the sales agent, she asked me a few questions. It turns out that I qualified for a discount because I had been living with my boyfriend for over a year. She reduced my current premium by $10. per month. Not too shabby.
I just wish they had a list of all the possible discounts available out there.

Jun 15th, 2008 @ 8:29 pm
16. paulette

Nowadays i would prefer investing money in the bank rather than purchasing a new car. Or if ever i have a car i will sell it.The price of gasoline is going sky high.

Jul 5th, 2008 @ 11:22 am
17. DAvid

Paulette,
While you not owning a car is admirable, it is not a possibility for many folks. Thus insurance savings are an important aspect of their financial plan.

DAvid

Jul 5th, 2008 @ 12:15 pm