Tuesday, November 1, 2011

Tips to Reduce your Auto Insurance Premium (USA)

This article comes as a result of the readers of my blog in USA & focusses on some methods to reduce Car Insurance premiums. I have compiled most of these tips by looking at the data supplied by the American Institue for Chartered Property Underwriters.

Remove towing coverage: Towing — or “emergency roadside service”, as it’s sometimes called — is an easy cost to self-insure (paying for the cost yourself). (You likely pay $10 to $30 a year for towing insurance, and one tow costs about $100, which you can save quickly by not paying for towing insurance.) Sometimes your car will break down, but
if it’s well maintained, that won’t happen often. Also note that if you’re in an accident, towing is usually covered under collision insurance — but check your policy to be sure.

• Plan well ahead: Compare auto insurance quotes before you buy your next car. Insurance costs are based on how likely a car is to be stolen, damaged, or to inflict damage, and how badly occupants tend to be hurt in accidents. Repair and replacement costs are also factors. Many insurance companies list cars with lower insurance costs on their websites.

You could also compare different costs websites like carinsurance.com. and insure4usa.com.

Watch your credit carefully: Most insurance companies now look at parts of your credit report to determine your premiums. This can be pretty dampening, but parts of your credit history have been found to correlate to what the company has to pay out! They can’t adjust your rates on your current car if you pay on time and in full, but anytime you add a new vehicle, its premiums can be affected by your credit.

Try not to pay monthly: Insurance companies charge a few dollars each month for monthly billing. To avoid that fee, pay every six months or even once a year, if possible. If you have to pay monthly, use your insurance company’s autopay program, which costs less because they don’t have to send you a paper bill.

Though it’ll always cost more to insure a new Corolla than a used Corolla, one of the best ways to keep costs low is to maintain a clean driving record. Insurance companies charge you based on how likely you are to file a claim — and accidents are the biggest source of claims.

Some insurance companies offer discounts for taking safe-driving courses. Others give low-mileage discounts — the less you’re on the road, the less likely you are to be in an accident. Be sure to ask about all the discounts you qualify for! I have seen some acturial calculations on determining premiums and found that Married people are charged lesser than unmarried people, since data has proven that married people drive safer (no kidding), so in case your insurance company doesn't know that you have married recently, let them know that when you renew your policy!

Stay abreast of the latest happenings in Personal Investing. Enter your email address (on top - right of this page) to receive free & unbiased articles on personal investing in your inbox! 


  1. Something which I was looking for!! :)

  2. Good one man, might be helpful to me if God will provide me a car!;)