Car Insurance Best Rates

The rest of this guide will help you follow several techniques that will reduce your car insurance costs regardless which insurance company you choose. But the first and most important step to saving money on car insurance is initially choosing the best car insurer.

Cost is certainly one factor when considering car insurance, but your insurer selection should be weighted more heavily on reliability. You could easily call a number of insurance companies, ask for quotes, and simply select the lowest bidder but there are websites that make this task much easier. Good examples of these websites are 2Insure4Less.Com and Kinetix. However, even if the lowest cost insurer saves you hundreds of dollars a year in premium payments, that savings does you no good if you find yourself in an accident, needing car repairs or medical attention, with an unreliable and unresponsive insurance company.

The following guidelines will help you find a list of the most reliable insurance companies to start with. Once you put together this list, you will be ready to move on to the following steps of this guide to save even more money on car insurance.

Check with Your State

Every state has its own department of insurance. These bureaus serve as a watchdog for insurance companies and most of them will provide statistics on all of the major car insurance providers such as rating and customer complaint ratios. Some of these bureaus even provide rate comparison charts, which can save you the trouble of calling around to obtain price quotes. If your own state doesn't have information about an insurance company that you're interested in, just check the insurance bureau website for a nearby state.

Get Your Hassle Free Car Insurance Quote Now

Before you begin calling around, it's important that you determine the level of insurance coverage you need. Not everyone's insurance needs are the same. Some families own two or three very expensive vehicles, while other families own only older used cars. Some people are members of AAA, while others are not. The specific terms of a policy should be determined by your life situation and the value of the items being insured.

Many people rush through the process of purchasing car insurance and simply accept the lowest quoted premium, and they typically don't take the time to go through the policy and instead select only those components that they absolutely need. It's a common misconception that there are only two basic types of insurance - liability or comprehensive, however this couldn't be further from the truth. Car insurance is typically made up of about eight components. While some of these components are required by state law, many of them are not. Make sure to check with the department of insurance office for your state (see the links above) to determine which of coverage is optional.

Car Insurance Best Rates

Whether you've already purchased car insurance, or you are getting ready to start looking, one of the best things you can do to obtain the lowest possible rates is to improve those things that car insurance companies look at when they calculate your insurance premium. There are several things you can do in the short term to improve your insurability standing, and there are also things you can do over the long term to improve it as well. This section will describe four major elements of this technique to save money on your car insurance.

Improve Your Credit Score

Most car insurance companies now consider your credit score when determining your premium. Insurers have decided that there is a correlation between your credit history and potential insurance claim behavior. While age, vehicle, driving history, and location all still have an effect on your premium, credit history can also have an impact. Depending on your personal credit score, this can be a good thing, or it can be a bad thing.

Regardless, now more than ever it is important to make sure that you have a healthy credit score so that you can obtain the lowest possible car insurance rates. Paying all of your bills on time is obviously the simplest way to maintain a good credit score; however there are a number of items that insurers look at when calculating this score, including:

* Bankruptcy, foreclosures or collections
* Payment history of loans and bills
* Amount of time you've had credit
* How often you've recently applied for credit
* How many open lines of credit you have
* Type of debt you have
* Debt to credit ratio (how much you owe vs. available credit)

Taking all of these factors into account, you can obtain lower car insurance rates with a higher credit score.

Another extremely effective technique to obtain the lowest possible insurance rate is to improve those things about your car which car insurance companies value the most when they calculate your insurance premium. There are several things that you can do before buying a car that will dramatically decrease your insurance premium. If you've already bought a car, however, and are looking for ways to decrease your existing insurance costs, there are still methods you can use that will substantially cut your premium costs.

Install Anti-Theft Devices

Any anti-theft device can be either active or passive. Active devices are the ones that you need to manually set to enable it. Passive devices are automatically enabled when the vehicle is turned off with the key removed.

Most discounts offered for anti-theft devices are on passive devices only. Some insurance companies may offer discounts for some active anti-theft systems, however, in most cases the passive systems are the ones that bring the steepest discounts. Installing your car with such a unit will dramatically reduce your insurance premium.

Another discount to keep in mind is the fact that many insurance companies offer additional rebates toward the deductible on claims if a vehicle equipped with such a device is stolen or damaged by thieves anyway.

Reduce your Mileage

Another way to reduce the rating of your car toward the premium cost is to drive it less. While this may sound impossible - in most communities it isn't. Many communities around the country offer "Park and Ride" parking lots where you can park and then board a bus that will take you to work. If you work at one of the larger companies in the area, or at a business that is located near one of the bus stops, you can save significantly by taking advantage of this mode of transportation.

Not only will you save significantly on gas costs, it is also better for the environment, and you will cut down on your insurance costs.

How?

Many insurance companies currently offer "low-mileage discounts" for drivers who drive less than a particular mileage limit annually. Usually it is under 15,000 or 12,000 miles each year.

For example, in 2007, GMAC and OnStar by GM technology offered GM insurance customers discounts on their premiums of up to 54% if they drive less than 15,000 miles annually. This system works significantly well with the OnStar system because actual mileage can be tracked. However, other insurance companies will use yearly registration records to verify mileage claimed on a premium. So it's important not to lie to the insurance company about actual mileage driven - but it's also important to try to cut back on miles driven if you can if you have an insurance company that offers these sorts of discounts, as they are often significant.

Switch Now! Save Hundreds!

In addition to all of the techniques already listed in this guide, there are also additional ways that you can use the insurance industries rating rules and premium calculation system in ways that will reduce your costs.

Reduce Teen Driver Costs

Insurance companies don't trust teens - it's really as simple as that. Statistically, teen boys and girls are in the highest risk categories for having accidents, and insurance premiums rise exponentially whenever a teen is on the policy. However, you don't have to let your premium rise out of control simply because you have a teen on your policy.

There are several ways you can do this.

1. Buy them the cheapest car possible

The most critical aspect of teen driving that insurance companies look at is the value of the car that the teen is driving. This doesn't mean that you should buy them a fifteen year old junk car - but it does mean that you'll save a lot more on your insurance bill if you buy them a Ford Focus instead of a Ford Mustang.

2. Buy them the safest car possible

Refer to the resources listed above in this guide to determine the safest cars on the market. While a 200 horsepower sports car might be tempting for a teenage boy, the insurance costs will be enough to drive a family into bankruptcy. Instead, focus on buying not only the least expensive car, but also the car that is listed on the very top of the national safety list. These two things alone will make a world of difference for your premium.

3. Don't ask, don't tell

While the ethics are questionable, it is not illegal - simply don't tell your insurance company that there is a licensed teen in the family. Insurance companies will charge higher premiums if there is a licensed teen living in the household, regardless of whether they are listed on the policy for a particular car. The simplest approach is to purchase the car and insure it under your own name as an additional car on the policy with yourself and your spouse (if applicable) on the policy. The teen can be considered an occasional driver, but not a primary driver - therefore if the insurance company doesn't ask if you have a licensed teen in the family, simply don't tell them.

If the teen is ever pulled over by a policeman for any reason, the insurance card is still legitimate and so is their license. Just keep in mind that the moment the teen receives a citation or has an accident, the insurance company will immediately know the teen is driving the car, and your rates will be adjusted accordingly. It could be a costly risk to take - but meanwhile it will save you tremendously.

4. Choose a high deductible

If you do plan to insure your teen on a new inexpensive and safe car, an additional way to reduce the insurance costs is to purchase a high-deductible insurance policy. Any insurance plan with a high deductible will always cost significantly less than a low-deductible policy. This is because you are accepting responsibility for a larger amount of any repairs resulting from an accident, so insurance companies are much more willing to offer you lower rates for the teen driver to be listed on your policy for that car.

5. Negotiate prices

Just because you have a teen driver doesn't mean they can rake you over the coals. Shop around! Get the lowest rate possible, and then call the other insurance companies and tell them the lowest rate that you were able to get, and allow them an opportunity to beat it. Sometimes, you can get a competitive rate even lower than the lowest quote from the initial round of calls.

Make the higher rate car the less used and garaged

Another approach you can use to take advantage of insurance policies is to use the car with the lowest insurance rates to commute to work. Accumulating most of your mileage on the car that has the lower rates will allow you to take advantage of low-mileage discounts on the car that is more expensive to insure. If your spouse stays at home with the kids, make their car which gets used the least the primary car.

Arranging the usage of your vehicles in this way will allow you to significantly reduce your overall premium because each car is calculated individually. Since one car is already inexpensive to insure, it doesn't really matter how many miles you place on it. However, when you do have a car that is more expensive to insure, such as newer vehicles, you need to do everything you can to reduce the usage on that vehicle so that the insurance rate for it is lower than it would be if you used it to commute to work.

This doesn't mean that you can never use the new car to go to work - it just means that you'll be telling the insurance company that this is the arrangement. Just keep in mind that insurance companies do verify mileage from the yearly registration - so try not to stretch the truth too much.

Pay the premium annually instead of monthly

Most car insurance companies provide the option for policyholders to pay off the entire premium all at once (annually), or at regular intervals - semi-annually, quarterly, or monthly. Most of the time insurance companies will offer a lower premium if it is paid annually - sometimes saving policyholders up to 10% on their car insurance.

One of the most important things that you can do to keep your insurance premium at a minimum is to always remember to update your insurance provider of any changes in your life that can reduce your insurance costs. Forgetting to do this can be very costly.

Life Changes That Can Affect Your Premium

Each time your life changes, while you may not realize it , those changes could very well have an impact on your policy. Additionally, throughout these changes, your insurance also needs to change. Re-assessing those needs and changes is something that you should do at least every few years in order to make sure that you aren't missing out on additional insurance savings.

There are a number of factors that impact your premium - and many of these a number of people are unaware of. These factors can significantly reduce your premium if you remember to update your insurance company about them.

- Age: Drivers over 25 are considered lower risks for accidents. Drivers aged 50 to 65 have the safest records. Most insurance companies adjust premiums accordingly based on age.

- Marital Status: A married person pays lower premiums than a single person. If you get married, make sure to let your insurance company know about it.

- Geography: Living in a rural area with fewer cars will result in a lower premium. If you move to such an area, report it to your insurer.

- Driving Violations: Accidents or moving violations can bring higher premiums. However most insurance companies only penalize customers for these for a limited period - usually five years. If it has been three to five years since your last accident or violation, ask your insurance company if it's about time for an adjustment to your premium accordingly.

- Credit Rating: Almost all insurance companies today now calculate a consumer's credit rating quite heavily when determining the premium. Make sure to obtain a year credit report for free, and when you see your overall score improve, make sure to check with your insurance company to ensure that your premium is recalculated accordingly.

- Occupation: Insurers calculate premiums differently depending on occupation. For example, a pizza delivery driver is calculated as a higher risk than an executive sitting at a desk all day. If you ever change jobs to one that requires less driving - make sure to let your insurer know.

- Education: The higher your education, the lower your premium. If you've recently obtained a bachelor's or master's degree, make sure to alert your insurance company and you'll enjoy a lower premium as a result.

All of these life changes can have a positive or negative impact on your insurance premium - so it's important to find out. Inform your insurance company of any of these changes, especially if you know that the impact on your premium will be a positive one.

Update Your Policy Today

There comes a point in the life of a car when the decision needs to be made whether or not it is worthwhile to maintain collision and comprehensive insurance coverage.
In general, comprehensive and collision coverage pays for:

- Damage caused to your vehicle when you cause an accident.

- Loss from causes other than an accident such as a storm.

Deciding when to drop collision and comprehensive coverage can be challenging. These days most cars retain their value much better than they used to, and many people owe more on their vehicles than they're worth.

While it makes some people nervous to consider dropping full insurance - in reality there is little benefit. The insurance company will never pay for repairs that cost more than the car is worth - if repairs cost more than the value of the car, they will simply consider it totaled and pay you the value of the vehicle. This is why, when your older vehicle has little value, it makes much more sense to remove comprehensive and collision on the vehicle entirely.

If you carefully follow each of the sections outlined in this guide, you are guaranteed to receive the lowest possible insurance rates for anyone within your calculated risk bracket. No one should ever overpay for car insurance - especially given the fact that there are so many insurers in the industry competing for your business.

Most people overpay for car insurance out of sheer laziness. However the consumer that understands how car insurance works, and is clever enough to take advantage of all of its loopholes, will save significantly on their premium in the long run.

Before you step foot into another insurance office, or visit another insurance website, make sure to print this guide and follow it carefully in order to ensure that you get the best insurance deal possible.