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10 Things To Do Now To Save On Car Insurance

Save Money On Car Insurance

The rising cost of car insurance is prompting people to search for cheaper options. As consumers research, they are being inundated with articles like “Car Insurance Premium Hacks” or “100 Ways To Save on Car Insurance”. The problem with many of these articles is that they are not written by someone in the insurance industry and are; therefore, misguided. Other articles offer you a million ways to save money but, upon reading, you learn that they just repeat the same thoughts in different wording. Some articles make appropriate suggestions for saving but they can’t be implemented quickly, like improving your credit.

At Bradshaw & Weil, Inc. in Paducah, Kentucky, we believe in educating consumers so that they can better understand their policy and make practical decisions on their coverage. We don’t take one idea and twist it to make two for a longer list. We’re just providing you with the top 10 basic things you can put in motion today to save money on your car insurance.

10 Things to Do Now to Save on Your Car Insurance

1 ) Usage Based Insurance

Usage based insurance is the new thing in the insurance technology world. It veers from the old ways of rating policies based on statistical data grouping and focuses rather on personal driving data. It works by plugging a device into your car or downloading an app onto your smart phone. The device then tracks driving speeds, time of day, hard braking and more for a certain period of time during which it develops the drivers true rate per their own calculated risk. You can find usage based insurance carriers in online form or in Independent Agencies if you still value relationship with a local agent. UBI helps you save in two ways because some carriers will offer an initial discount just for participating plus the potential to earn more savings as your driving risk is calculated.

2 ) Annual Term Vs. 6 Month

You won’t find this method of reducing premium on many of the lists out there. Annual auto policy terms are newer to the industry but are becoming more commonplace in recent years. Still, not every carrier offers annual terms yet. So, how do they reduce premium? Two ways. First, annual terms lock in a rate for the insured for a year rather than 6 months. Insurance companies can typically only increase rates for claim activity, driving record activity, change in insured credit or standard insurance rate increases at the term renewal. Having a 6 month terms means the insured could be hit with rate increases twice a year rather than once.  Secondly, many carriers offer a small discount up front for choosing an annual term because it helps them retain the client for a longer period of time.

*Disclaimer: Insurance carriers will increase rates for changes you make to your coverage like adding vehicles or drivers at the time the change is made.

3 ) Payment Plan

Payment plans can affect your premium in a number of ways. While your current payment plan may only be adding minimally to your overall insurance expense, it is still worth looking at as small costs can add up over time. Most carriers offer a pay in full discount for paying your entire term premium up front. This is the most cost effective way for the insured. We understand that most people cannot afford to pay the large lump sum and would need a monthly option. If that is the case then the best option would be to pay through automatic withdrawal from your bank account or credit card. This payment method may not always be considered a discount but it does reduce your monthly installment fees. Monthly bill by mail is typically the least cost effective way to pay your premiums. Each monthly installment incurs an approximately $5 fee.

4 ) Advanced Quote Discounts

Statistical data shows that people searching for insurance at the last minute have been canceled and are higher risk than those that begin looking earlier on. (Statistics don’t account for hectic lives obviously). Next time you are thinking about shopping for insurance start early. Give your agent about 15 days or more before the policy must be issued in order to qualify for optimum ratings with an advanced quote discount.

5 ) Provide Education & Occupation Information

Consumers are leery of insurance agents. They often feel they are being oversold and taken advantage of so they decline to provide information they think will hurt their rates or that seems unnecessary.  This is where working with a local agent that you trust can be so beneficial. Many carriers offer discounts for providing specific education and occupation information. It all goes back to that old statistical rating format. Declining to answer could actually hurt your rate.

6 )  Bundle Your Insurance

This method of reducing premium is the one way every agent in town is talking about because it actually is true! Bundling does help you save. Multi policy discounts are a real and often significant. The more your agent can insure for you the better you will be protected from gaps in coverage and the better your premium will most likely be compared to spreading your business around. Agents that have multiple options will be able to better cover your total risks and offer you better rates.

7 ) Review Discounts Available

It is important to reach out to your agent to determine what discounts are available to you at your current stage of life. Young drivers can earn discounts for good grades or additional driver training courses. Older drivers can earn discounts for the AARP driver training course or for senior mileage (less than 2,000 miles driven annually). There are many discounts available. It is just a matter of determining what you qualify for and your insurance carrier.

8 ) Review Your Coverage

You should always review your coverage  to make sure it is up to date. Doing so can also lead you to savings. Reviewing your coverage with your agent gives you the opportunity to discuss the impact of your deductible. Perhaps it can be increased or deleted all together depending on the age of your vehicle.  It also gives you the opportunity to look with your agent at other creative ways to reduce premium. Chances are that the coverage you first needed is not the same coverage you need today and that your financial state when you first took out your policy is not the same as it is today. * Note we do not recommend reducing liability coverage in order to save premium. Note that while it can be beneficial to shop your insurance every few years it can have opposite effects if you shop it every renewal.

9 ) Insure All Vehicles & Drivers in the Household

This one sounds crazy. Adding driver’s and vehicles to your policy is not going to make your premium go down. But, it can sometimes do a better job than when individuals in the same household try to insure everything separately. Many carriers want all driver and vehicles in the same household on the same policy as a general rule. Doing so can benefit the insured through multi car discounts and lowering the rate through sharing the risk among multiple drivers in the household.

10 ) Avoid Cancellations & Late Payments

If your policy lapses for non-payment or is cancelled for cause then you will be put into a higher risk tier. Generally speaking, the higher the tier the higher the premium. Sometimes life works in such a way that your policy is issued around the same time as your other bills which makes it hard to always have the funds at the due date. If this is an issue in your home, then call your agent to see if your company will allow you to pick a different due date. If changing your due date is not an option then you may consider having your policy rewritten with a new due date that you can manage.  This will not be a feasible option for everyone but it is worth mentioning and considering.


If you have questions on the topics above then please give us at Bradshaw & Weil, Inc a shout here.