Saving Money On Car Insurance
I’m a big proponent of tracking automatic monthly payments. The things you cannot get rid of and either want to or have to pay for. Whether you’re talking cable bills, internet, car insurance, homeowner’s insurance, or any other payments you may have coming in monthly. Evaluating your monthly payments for savings is a must. Speaking of this, there’s no better time to take a look at this than the present. These are always going to be a part of your budget, so why not save a few dollars if you can? Especially if it’s easy to save on car insurance. Even saving $50 a month and investing it equals out to $8,754.52 at a 7% return (maybe track it on Personal Capital?) I’ve compiled 5 ways below on how you can save hundreds of dollars per year (if not more). Just because insurance is required doesn’t mean you should have to overpay.
1. Compare Rates
When was the last time you compared rates of different insurance companies? Personally, I like to check every 6 months or so (convenient since that’s how long most policies last). So, when the policy comes up for renewal. Most companies have an easy method of pulling all of your vehicle and driver’s license data from other insurers. This makes checking rates even easier! In just a few short minutes you can find what USAA, Geico, State Farm, Allstate, Progressive, etc… charge and see if it’s a better deal. This doesn’t account for customer service and ease of claims but in my experience each company has it’s share of great representatives. When you are checking, make sure the same desired coverage still applies. Companies can usually pull your current information, but not all offer the same coverage.
In my last location I had carried over USAA from Texas since they were cheapest. I kept it for a few months thinking they were cheapest there, it only makes sense they are cheapest here. It took a few months before talking to some co-workers who told me how much I was leaving on the table. GEICO was half the rate USAA was charging for the exact same coverage. This meant for the first few months I was spending nearly $100 a month extra for the same coverage before I realized I needed to be comparing rates. After this latest move GEICO is still the cheapest but only by $20-30 a month. This is still hundreds of dollars a year but they have been creeping up $5-10 a month each renewal.
2. Adjust Your Deductible
There are two different forms of car insurance that you most likely carry, collision and comprehensive. Collision insurance refers to the insurance in the event of a car accident with another vehicle or object. Comprehensive covers you in the event of a disaster such as a tree falling on your vehicle, vandalism, running into an animal, fire, and things like windshield replacements. When adjusting the deductible it pays to ask yourself, do you need a $0 or low deductible? Adjusting these deductibles can save you on the order of $10-$50 a month by changing it from $0 or $250 up to $500 or a $1000 if not more. This is a decision based on the amount of risk you are comfortable with, but if you have a well-funded emergency fund (3-6 months of expenses in a savings account) it pays you to save money each month.
Additionally, there are 5 states that have zero deductible windshield replacement irregardless of your deductible. So when that rock hits your windshield and you think you’re out hundreds of dollars your state may pay the bill. These states are Florida, Kentucky, and South Carolina. Kentucky and South Carolina go so far as to offer free replacements on any auto glass that needs replacing. There are some caveats such as you still have to have insurance but this means you can take this into account when setting your deductible amount. Many other states such as Connecticut, Massachusetts, and New York offer the ability for drivers to set different deductibles for comprehensive insurance and windshield replacement. So for comprehensive you could set a $500 or $1000 deductible and windshield could be placed at $100.
Note: While financing a vehicle some insurers require a specific deductible or less, such as a maximum of $500 per instance.
3. Take A Defensive Driving Course
This one came into play just recently. In just a couple hours time I was able to save the Mrs. and I $200 a year. $200! GEICO offers this through the National Safety Council an online defensive driving course. For $20 a person, we were able to save $100 a year. That means we paid ourselves back in just a couple months and all it took was a few hours time. You can find more information on GEICO’s offering for defensive driving here. USAA offers similar courses through vehicle tracking and their SafePilot app.
4. Combine or Split Your Insurance Discounts
Most insurance companies will offer higher discounts if you combine insurance policies. This can include homeowner’s insurance, renter’s insurance, umbrella coverage, and motor vehicle insurance. Sometimes this means a company will be slightly more expensive for homeowner’s insurance but the cost increase is offset by the reduction in vehicle insurance. This can work in reverse though too and is why budgeting and tracking your purchases can be so effective at saving money, including those super small transactions.
Now inversely this can work in your favor as well. Having all of your insurance bills in one place makes life easy when paying but it could be costing you as well. Check those rates every 6-12 months!
5. Raise Your Credit Score
Ignore this for those that live in California, Hawai’i, or Massachusetts (hey twice on the same list!). In other states car insurance companies can take a look at your credit history. This is not a hard pull and you won’t see it effect your credit score. When they do look, it will effect your car insurance rate, so don’t be surprised to see your car insurance rates change as your credit score does. Now if only we could all see the variables that go into saving on car insurance rates and why they seem to always change every 6 months even if it is only a few dollars.
Thanks for reading! Let me know if you have other ways you save on car insurance.
standard oyster company says
At this time it looks like WordPress is the preferred blogging platform available right now.
(from what I’ve read) Is that what you’re using on your blog?
Eric says
Yes, I use WordPress. There are two versions, the WordPress.com website which has a free version and WordPress.org which is it’s own program that can be used on a web hosting service. WordPress.com does limit you on what plugins you can use and will use ads if you select the free version. For WordPress.org I host on Bluehost which charges between $3-10/mo depending on features you want and the length of contract you sign up for. Depending if you already own the web address you may have to pay for this as well. For the web address I purchased it through Google Domains. WordPress.org is pre-installed on Bluehost and very easy to customize and use with various themes and design elements. I’ve used it for a few months, but feel free to ask any questions and I’ll do my best to answer it.
Other options available that are not WordPress are websites like Blogger (free), Wix, or Squarespace. Wix and Squarespace help you design your website easily but does limit your customization and ability to monetize. Additionally I previously ran on Wix and the website was very slow although I have heard they have improved this.