7 ways to reduce your auto insurance rates

Many of us know of a few obvious ways to reduce our auto insurance rates. You can increase your deductible, or for an older vehicle, you can trim down your policy to include just liability coverage. However, there are a few other ways you can decrease rates that many people don’t take advantage of. Here are seven cost-cutting measures many people overlook.

1. Drive less

One way you can reduce your auto insurance premiums is to drive your car less. It seems fairly obvious, but few people may be willing to change their driving habits in order to get a break on their insurance premiums. According to the Insurance Information Institute (III), some car insurance companies give discounts to people who drive less than a certain number of miles annually.

If it’s available in your state, you might also consider a pay-as-you-drive (PAYD) policy. These programs allow insurers to track the number of miles you’ve driven (some look at odometer readings while others use GPS systems), and reward those who drive less than the average motorist with discounted rates.

2. Move to a safer ZIP code

Your auto insurance rates are partially based on where you live. Some cities have a greater risk of car theft, and insurance companies are likely to charge higher premiums if they believe vehicle theft, vandalism or break-ins are more likely to occur in your neighborhood. If it’s feasible, you might consider moving to a safer ZIP code. When you notify your insurance company of your move, you may find that your premiums are lower.

3. Park in a garage

Vehicles parked on the street are often attractive targets for those looking to steal a car. If you park on the street, your car may also be at greater risk of being struck by other vehicles. If you have a garage, use it to park your car.

Already parking in the garage? Make sure your auto insurance company is aware that you are making use of off-street parking.

4. Take an advanced driving course

Some insurance companies will give you a discount if you go a certain amount of time without getting a ticket. However, this is not the only way that you can save money.

Advanced driving courses provide you with tips and allow you to practice driving techniques to help you become a better driver. Defensive driving courses show insurance companies that you are attempting to be more responsible on the road. As a result, some insurers offer lower car insurance premiums.

5. Verify the accuracy of your auto insurance policy

Have you looked at your auto insurance policy lately? Many people don’t take the time to review their policy documents, and may end up paying more because of it. It’s a good idea to review your coverage each time your policy is up for renewal to make sure it’s still in line with your needs.

6. Discounts based on your age

You may qualify for discounts based on your age. For example, some auto insurance companies offer retirement discounts or senior car insurance discounts. The III says that in retirement mileage is likely to decrease because you are no longer commuting to work. Consequently, drivers over the age of 50 to 55 may qualify for an auto insurance discount.

7. Ditch monthly premium payments

You might be surprised to learn that some insurance companies charge a “convenience fee” for monthly premium payments. By choosing to pay your premiums semi-annually or annually, you could save money on your auto insurance.

It can be difficult to come up with the money all at once, but it’ll usually save you in the long run. You can make it easier by making “premium payments” into a high yield savings account every month, and then writing one check for the premium when it’s due.

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