The most common and necessary insurance that you will be facing in your life are auto and housing insurances. However paying that costly monthly premium isn’t a joke. It may take up significant percentage of your take-home pay. I totally feel your pain. Well… I can’t let that happen to my precious after-tax-take-home pay. As you know, I have a strong challenge everything mind-set and I have been using the following 16 tips to cut 40-60% of my insurance premium.
1. Big No for luxury cars
Think again. Luxury automobiles is typically more expensive to insure as they are often popular targets by thieves, more expensive to repair and replace. I have attached How Cars Measure up by IBC BAC which shows Collision, Comprehensive, Direct Compensation Property Damage and Accident Benefit claims for the most popular cars for 2000- 2012 models (which could be easily applied to current 2014-2015 models). All the ratings are expressed in relative terms with 100 representing the average in each category which means if something is 145, then it means 45% above average. Lower numbers indicate cheaper to insure. When you read through them you can easily tell that luxury cars, newer cars, 2 doors, sport cars, coupe and popular cars such as Civic etc are more expensive to insure.
2. Keep your annual driving as low as possible.
Insurance rates depends on for what you are driving your car and how much you drive. Keep your annual driving as low as possible to minimize your insurance. If you can walk or take public transit, then take them rather than driving.
3. Keep a clean driving record
As you know keeping a clean driving record is the key to save insurance cost. If you have lots of speeding tickets, then you can easily see your insurance rates to double or triple. Maintain an accident free record for your money.
4. Cancel your collision and comprehensive insurance
If you drive an old car, cancel your unnecessary collision and comprehensive coverage. Just writing the car off could be cheaper than paying so much money to your insurance company.
5. Increase your deductible
You can also increase your deductible to reduce premiums.
6. Combine your home/tenant and auto insurance
Typically you can get 5-10% saving
7. Membership discounts
You may be able to get discount of being a member of certain organization such as being a student or an alumni at certain colleges, being an accountant, lawyers etc… My university degree gave me 5% of saving but being in a professional association gave me 10% saving from my current insurer. Unfortunately, I could only pick one of them.
8. Employer group discount or Union discount
When I was working for a big 4 firm, I got a group insurance discount that gave 10% off. Unfortunately, that was gone when I left.
9. Senior discount
Well… as a respected senior citizen, you deserve to get a discount.
10. Dashboard camera
This may not decrease insurance premium but it can protect you from unfair premium raises in case of not-at fault accident.
11. Driving course
Especially for first-time insured
12. Get married
Did you know that if you are married, the insurance company will see you as a less risky driver and reduce your premium to pay? Yes!
13. Be a secondary driver.
Especially when you are being insured for the first time. Ask your mom or dad to include you as a second driver as being a principal driver for the first time will break your wallet. J
14. Annual vs. monthly payments
Check to see how much discount you may get through paying all at once. It may save you $100-$300 in total.
15. Shop around at every anniversary
Make sure to shop around to get multiple quotes and compare them as every insurance provider has different rules and policies of calculating the premiums.
16. Just call them up
Just call the insurance company and tell them that you want to reduce insurance premiums by going down each line item that determines the premiums. You can update your most recent information and probably cut back some of insignificant line items such as 1) take off roadside assistance if you are driving a newer car 2) take off rental coverage in case of an accident 3) reduce yearly mileage etc…
Did you enjoy the article? Then you may be interested in reading the following article to save even more!
30 most important tips to be a millionaire no matter how much you make.
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I didn’t know that you could pay car insurance all at once. I thought that you had to pay it monthly, but thanks for the tip! I think I’ll try that out, it could save me a lot of money this year. I am trying to cut back on any expenses that I have.
We have a minivan that’s about 20 years old, yet our insurance rates are really high. I think it’s because of my husband’s driving record. He does get tickets for speeding, but hasn’t really ever been in an accident. So, I’m thinking the idea of getting rid of the collision coverage is a good one that could really help us save. Thanks!
This is some great information, and I appreciate your advice to increase your deductible to save money on auto insurance. I drive pretty safely, and I’ve never been in an accident before, so I think I could afford to bump up my deductible a little bit. I’ll definitely look into doing that so I can save some money on my premiums over time. Thanks for the great post!
Thank you for this in-depth article about car insurance! I have been searching for the right insurance for me, but it is sometimes tricky. This was very informative!
I thought that a few of these tips for lowering my insurance rate were really interesting. It’s great that there are employer group discounts that I can take advantage of. I should ask my employer if that’s an option I can look into. You also said that married couples are considered as safer drivers, so that’s why they’re offered cheaper rates. I just married my husband, so we should ask for a discount on our auto insurance. Thanks for the tips!
Thank you for the help. I just recently bought a car and need to decide on the car insurance. I also got married recently, but I had no idea that could help lower my car insurance. Is that a common way to save from pretty much any insurance agency?
This is some great information, and I appreciate your suggestion to keep your annual driving low to reduce your insurance costs. I didn’t realize that the amount you drove could have an effect on your insurance rates! There’s a bus stop pretty close to my house, so I could take public transit to work. Knowing that it could help me save money, I’ll definitely look into that.
I really like your advice to keep your driving record clean. That sounds like it would be obvious, but many people don’t understand that a poor driving record can damage their chances of getting a lower rate. Do you have any other tips about getting a good insurance rate? I’m thinking about getting a new policy, but I don’t know what I need to do in order to get a good one.
It was very informing to know that luxury automobiles are typically more expensive to insure. My husband was thinking about buying a Tesla this coming year. We are also wanting to help my kid through college, so we will be sure to talk about what we will do!
It’s good to know how to save on car insurance. It makes sense that a cleaner driving record means lower rates. I’ve got a speeding ticket, but other than that, nothing. I hope that’s good enough!
It’s really great post.I got some good information.
Thank you so much for sharing with us.