Car insurance is the number one way to protect yourself against financial and legal vulnerability while driving. However, paying for an insurance policy is an extra cost that some people cannot afford. In 2020, it cost $1,427 per year on average to insure your car. Many states require that you must have insurance in order to drive, so being able to afford insurance is vital to owning a car. Thankfully, there are some ways to decrease your monthly premium and make car insurance more affordable.
The Costs of Insurance
The cost of auto insurance can be thought of as the monthly premium and the annual deductible. The premium is often the most expensive part of your costs unless you need to file a claim that year and pay the deductible. The cost of the premium is based on where you live, your age, your gender, what type of car you drive, your driving history, and your credit score. You can only change some of these factors. By focusing on these factors and other tricks, you can decrease the cost of your monthly premium.
Decreasing the Cost of Insurance
- Drive a different car.
One way to decrease the cost of your monthly premium is to plan ahead and purchase a different car. If you have a nicer, newer car, the insurance company would have to spend more to fix it if it needed repairs. However, if you have an older, less luxurious car, the insurance company would not have to pay as large a claim. Therefore, buying a less expensive car lowers your premium.
- Change your insurance options.
There are different levels of coverage. Some people want full coverage, while others just want the minimum coverage necessary mandated by their state to drive. The difference in price is drastic. For example, in New Jersey, the annual price of full coverage was $1706. In contrast, the minimum coverage price was $727. This is almost $1,000 in savings!
- Take advantage of discounts.
There are a variety of discounts you could take advantage of when purchasing an auto insurance policy. For example, many companies offer discounts when you bundle insurance policies. For example, if you purchase renter’s insurance or homeowner’s insurance from one company, they will often give you a discount on your auto insurance. You could also bundle with other people in your home for a multi-car discount. There are also discounts based on your behavior. For example, being a good student gives some people a discount, while being a safe driver also provides a discount.
Need Help? Call a Redwood Agent!
Lowering your monthly premium is easy if you have someone who has experience. At Redwood Agency, we know how to get our clients the deals they need. Call a Redwood Agent to learn more today!