In today’s economy, money can be a major concern, and many people end up looking for ways they can trim expenses. Car insurance is one of those expenses few people can cut out entirely, but it’s possible you may be paying too much. In fact, according to a recent survey conducted by Forbes Advisor, almost 60% of drivers believe they’re paying too much for car insurance. If you happen to be one such person, it may be time to take stock of your auto insurance situation and see if you could save some money. Here are some questions you can ask yourself to help determine if you’re overpaying for car insurance:
What is the average rate in your state?
Not every state is created equal when it comes to auto insurance — in fact, premiums can vary widely by state and even zip code! Every state has different factors that can affect premiums, such as local laws, population density, and accident rates. If you don’t know the average rate in your state, consider looking it up — and if your premium is out of sync with the state average, talk with your insurance carrier and find out why. While moving out of state to lower your insurance premiums isn’t exactly feasible, you should at least make sure you’re not paying more than the average without good reason.
Are you over the age of 25?
Like it or not, your age plays a major role in how much you pay in car insurance premiums — especially when you’re younger. Teenagers are, notoriously, the most expensive demographic to insure by far, and until you’re 25, most insurers will consider you a high-risk driver. If you’re over 25, your rate should start to decrease, and if you’re not seeing such a reduction, you may wnt to start shopping around to compare car insurance quotes.
Did you get married or buy a house?
Big life changes can mean big changes in your insurance premiums. Married couples and homeowners often have lower car insurance rates, as they’re considered more responsible in general and not as likely to take risks behind the wheel. If you’ve recently become a homeowner, consider bundling your auto and home insurance together to get a discount.
What is your profession?
Not everyone is aware of this, but the work you do can significantly affect your car insurance premiums. Many insurance companies offer discounts for certain professions, such as teachers, healthcare workers, police, and military. You may even qualify for a discount if you work from home and don’t use your car very often. Ask your insurer about switching to a pay-per-mile plan to bring down your premiums.
Do you need collision and comprehensive coverage?
This is one of the oldest tricks in the book when it comes to paying less for car insurance: drop coverage you don’t need. If your car is older and has a low market value, paying for collision and comprehensive coverage could cost you more than the worth of the car should it get damaged or totaled. It might be a better course of action to drop both types of insurance and just keep liability.
Did you sign up for gap coverage when you bought your vehicle?
Gap coverage is something many car dealers offer when your purchase a vehicle — it protects against the difference between the car’s value and the amount you owe on a loan should the car be totaled. It sounds good on paper, but many car dealers sell gap coverage at an inflated price, and you simply may not need it. Talk to your insurance carrier to see if you truly need this coverage… and if not, drop it.
When was the last time you compared car insurance prices?
Although many people tend to stick with their existing car insurance just because of momentum — unless there’s a major problem, most people see no reason to switch. But according to a study by Expertise.com, 62% of Americans might be missing out on potential savings by never shopping around. It’s easy to get free car insurance quotes online — The Zebra’s Kristine Lee offers a handy guide to organizing your comparison shopping and getting a free car insurance quote.
Are you missing out on discounts?
Finally, don’t be afraid to ask your current auto insurance company about possible discounts. The average car insurance company offers upward of 50 discounts for various criteria, including:
- Good driver discounts
- Good student discounts
- Multi-vehicle discounts
- Taking a defensive driving course
- Increasing your credit rating
- Bundling your home and auto insurance
- Installing safety equipment on your car
- Installing anti-theft devices
- Agree to have a telematics tracker on your vehicle
- and much more
Shopping around for a better deal on your car insurance doesn’t have to be a massive hassle — with free online tools and a little footwork, you could potentially save a lot of money on your insurance premiums.
