Here are a few suggestions for ways to reduce your premiums:
- Shop around for insurance. Just because your current company once offered you the best deal doesn't mean it's still competitive.
- Increase your deductibles. For instance, if you agree to pay the first $500 or $1,000 of damage to your car, your collision insurance will cost less but still cover you for a serious accident.
- Reduce your collision or comprehensive coverage on older cars. One rule of thumb is to drop this coverage once the car is worth less than $2,500.
- Find out what discounts are available from your company (or from a different company). Discounts are often given to people who:
- use public transit or carpool to work
- take a class in defensive driving (especially if you are older)
- own a car with safety features such as airbags or anti-lock brakes
- install anti-theft devices
- are students with good academic records, or
- have no accidents or moving violations within the past few years.
- Find out which vehicles cost more to insure. If you're looking to buy a new (or used) car, call your insurance agent and find out which cars are expensive to repair, targeted by thieves, or involved in a higher rate of accidents. These vehicles all have higher insurance rates.
- Consolidate your policies. Most of the time you will pay less if all owners or drivers who live in the same household are on one policy or at least are insured with the same company. You may be able to get a discount if you have both automobile and homeowner's or renter's insurance from the same company.
To learn more about car insurance, get Nolo's Encyclopedia of Everyday Law, by Shae Irving and the editors of Nolo. This handy guide contains information about cars and driving, as well other legal topics affecting the average American.
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