Not so long ago, contracts were made on a handshake and a promise. Individuals were not particularly concerned with things like insurance because they relied on the goodwill of their neighbor to compensate them for undue damage. For a variety of reasons, including an increase in the speed and cost of car wrecks, auto insurance has quickly become a major purchase for responsible individuals. Soon after, the federal government required that car insurance be carried, at least as a minimum, by all car owners. The increase in the need for auto insurance over the past 10 years has led to an increase in the complexity of insurance, while amplifying the need to be more cost-conscious in auto insurance purchases.
The purchase of car insurance today requires as much dexterity as the purchase of the automobile itself. It is important to know the factors that an auto insurance company considers when offering quotes. This will let you, the consumer, know what steps you need to take to qualify for a lower quote. The five easy steps to getting a lower insurance quote are:
1. Present yourself as a "safe" candidate: Insurance companies are interested in risk management. Therefore, they offer drivers who are less likely to get into wrecks or at least less severe wrecks, a lower insurance quote.
-Maintain a clean driving record free of traffic violations or accident claims.
-Install anti-theft devices in your vehicle.
-Participate in a driver safety training program.
-Buy a "safe" vehicle. The National Highway Traffic Safety Administration (NHTSA) and the Insurance Institute for Highway Safety together collect information on safety-related aspects of different vehicles. Buy an automobile that is officially designated as "safe".
-Park your vehicle in a garage.
2. Show your creditworthiness: As a risk management entity, insurance companies are also concerned about getting paid on time. If you can prove you're creditworthy, you're less likely to miss payments on time, which justifies a lower rate.
-Maintain a good credit score and correct any mistakes on your credit.
-Reduce the total number of credit cards in circulation to 2 or 3.
3. Practice financial wisdom: The way you structure and pay for your policy can reduce the risk an insurance company faces to you as a customer. By taking steps to reduce their risk, you receive a lower quote and insurance policy.
-Buy an annual policy instead of six-month coverage to get a lower rate that stays the same for a year.
-Opt for direct debits from your bank account or credit card to avoid being charged for payments by mail.
-Raise your deductibles on comprehensive and collision policies to lower rates.
-Get loyalty discounts by taking out your home and auto insurance with the same company.
4. Accurately assess your insurance needs: Obviously, the more coverage you get, the more it will cost you. Add-ons are killers in the insurance business, cut your policy to the minimum you need.
-If your vehicle is little used or you have an old car with little market value, go for minimum liability alone. It will cost you less.
-After fulfilling the legal mandate on car insurance, insure yourself according to your sole needs.
5. Other Wise Things You Can Do: There are a number of other considerations that go into your insurance quote. Some of them are not reasonable steps to take, while others can be done with little effort, which can result in substantial savings.
-If your car is only used for a particular purpose, inform your agent, this will limit the costs.
-Students who get good grades are often entitled to a discount.
-Quit smoking; this can help you get better quotes.
- Change jobs if you can help. A delivery person carries a higher risk than a storekeeper.
