Scraping up a payment for pricey auto insurance can consume your accounts and possibly require you to analyze your spending habits. Shopping your coverage around can help to make ends meet.
Popular companies such as State Farm, GEICO and Farmers Insurance promote their brand names with ad campaigns and it is challenging if not impossible to see past the geckos and flying pigs and do the work needed to find the best deal.
You should make it a habit to get comparison quotes before your next renewal because rates are variable and change quite frequently. Even if you think you had the best premium rates two years ago a different company probably has better prices today. Ignore everything you know about auto insurance because we’re going to demonstrate the things you must know in order to eliminate unnecessary coverages and save money.
If you are paying for car insurance now, you stand a good chance to be able to reduce your rates substantially using these techniques. Choosing the best insurance company for you in Berkley is quite easy. Although Michigan vehicle owners do need to learn the way companies determine prices because it can help you find the best coverage.
Informed consumers save more
Many different elements are considered when you get a price on insurance. Some are pretty understandable such as traffic violations, although some other factors are less obvious such as whether you are married or your financial responsibility. When buying auto insurance it’s important to understand some of the factors that come into play when calculating your policy premiums. If you have a feel for what influences your rates, this enables informed choices that may reward you with cheaper rates.
The factors shown below are most of the major factors companies use to determine prices.
- Vehicle theft costs us all – Selecting a car model with an alarm system can help lower your premiums. Anti-theft features such as LoJack tracking devices, vehicle tamper alarm systems or GM’s OnStar system all help stop vehicle theft.
- Cheaper rates by bundling – The majority of insurance companies apply lower prices to buyers who have multiple policies with them. It’s known as a multi-policy discount. Even if you already get this discount, it’s in your best interest to get quotes from other companies to guarantee you are still saving the most.
- Lower premiums for vehicles with better crash test results – Cars with five star safety ratings get lower rates. Vehicles built for safety help reduce the chance of injuries in an accident and better occupant protection translates into savings for insurance companies and thus lower rates.
- Defend yourself with liability protection – The liability section of your policy is the protection when you are ruled to be at fault for personal injury or accident damage. Your liability coverage provides you with a defense in court which can cost a lot. Liability insurance is quite affordable compared to other policy coverages, so do not cut corners here.
- Teenagers vs. older drivers – Inexperience drivers are statistically proven to be easily distracted when behind the wheel and because of this, their auto insurance rates are much higher. Parents adding a inexperienced driver onto a policy can be very expensive. Older people are shown to be more cautious, file fewer claims and receive fewer citations.
- The higher your credit rating the lower your rates – An insured’s credit history will be a significant factor in your rate calculation. Therefore, if your credit score is not that good, you could save money insuring your vehicle by repairing your credit. Drivers who have high credit scores tend to file fewer claims than drivers with bad credit.
- Insurance rates for married couples – Having a spouse actually saves money compared to being single. Marriage generally demonstrates drivers are more mature than a single person and insurance companies like that married drivers tend to file fewer claims.
- Auto insurance rates can be impacted by your vocation – Occupational choices like fire fightersairline pilots and miners generally pay higher premium rates in part from intense work situations and extremely grueling work hours. Other careers like scientists, athletes and the unemployed get better rates.
There are several ways to compare auto insurance quotes, and some are more efficient than others. You can waste a lot of time driving to insurance agencies in Berkley, or you could save time and use the web to get the quickest rates.
Most car insurance companies belong to an insurance system where prospective buyers send in one quote, and each company returns a competitive quote based on that information. This eliminates the need for quote requests for each company you want a rate for.
To find out how much you’re overpaying now click here (opens in new window).
One minor caviat to getting quotes like this is you are unable to specify the insurers you want to price. If you wish to select from a list of companies to compare prices, we put together a list of low cost auto insurance companies in Michigan. Click here to view list.
It’s up to you how you get prices quotes, just be sure to compare equivalent quote information for each quote you get. If your comparisons have different data you will not be able to determine the lowest rate in Berkley. Quoting even small variations in coverage limits can mean a large discrepancy in price. And when comparison shopping, comparing all the rates in your area provides better odds of finding more affordable insurance. Some regional insurers cannot provide prices over the internet, so you need to compare prices from the smaller companies as well.
Big brands don’t always mean big savings
Auto insurance providers like Progressive, Allstate and GEICO consistently run ads on television and other media. They all say the same thing that drivers will save a bundle if you switch your coverage to them. It sounds good, but how can they all offer you a better deal? This is the trick they use.
Insurance providers can use profiling for the type of driver that makes them money. For instance, a desirable insured could possibly be between the ages of 40 and 55, owns a home, and has great credit. Anybody who fits that profile gets the lowest car insurance rates and will save when they switch companies.
Potential customers who fall outside those criteria may be required to pay a higher premium which usually ends up with the customer not buying. The wording the ads use say “people that switch” not “all people who quote” save that much when switching. That’s why insurance companies can confidently claim big savings. This emphasizes why you need to do a rate comparison at every renewal. It is impossible to predict with any certainty which company will fit you best based on your risk profile.
Do you qualify for discount auto insurance?
Some insurance providers don’t always list every possible discount very well, so here is a list some of the best known and also the more inconspicuous auto insurance savings.
- Auto/Home Discount – If you combine your auto and homeowners policies with one company you could get a discount of up to 20% off your total premium.
- Drive Less and Save – Keeping the miles down can qualify you for discounted auto insurancerates on garaged vehicles.
- Discount for Home Ownership – Owning a house in Berkley can save a few bucks because it shows financial diligence.
- Safety Restraint Discount – Requiring all passengers to wear their seat belts can save 10% or more off the PIP or medical payment premium.
- Distant Student Discount – Children who attend college more than 100 miles from home and won’t have access to an insured vehicle could qualify for this discount.
- Good Student Discount – Excelling in school can get you a discount of up to 25%. Many companies even apply the discount to college students up to age 25.
- Multiple Vehicles – Having multiple vehicles with the same auto insurance company qualifies for this discount.
- Anti-lock Brake System – Cars, trucks, and SUVs that have anti-lock braking systems have fewer accidents and earn discounts up to 10%.
It’s important to understand that most credits do not apply to the entire cost. A few only apply to specific coverage prices like comprehensive or collision. So even though it sounds like all the discounts add up to a free policy, it’s just not the way it works. Any amount of discount will bring down your policy premiums.
Companies and the discounts they provide are:
- Progressive may include discounts for homeowner, online quote discount, good student, continuous coverage, multi-policy, and online signing.
- AAA discounts include multi-policy, good student, education and occupation, anti-theft, and pay-in-full.
- Farmers Insurance has savings for pay in full, electronic funds transfer, youthful driver, mature driver, distant student, and teen driver.
- GEICO offers discounts for five-year accident-free, emergency military deployment, daytime running lights, military active duty, defensive driver, federal employee, and multi-policy.
- Esurance includes discounts for good driver, paid-in-full, emergency road assistance, multi-policy, and safety device.
- SAFECO offers discounts including multi-car, bundle discounts, homeowner, teen safe driver, anti-lock brakes, safe driver, and teen safety rewards.
- State Farm may offer discounts for driver’s education, anti-theft, student away at school, safe vehicle, and Steer Clear safe driver discount.
When getting , it’s a good idea to each company or agent how many discounts you can get. Depending on the company, some discounts may not apply to policies everywhere.
More tips and info about auto insurance can be read at the Michigan Office of Financial and Insurance Regulation website. Michigan consumers can view a list of available companies, find out industry alerts, view agent and company licensing information, and read consumer alerts.
The best insurance company isn’t always the cheapest
You just read some good ideas how you can lower your auto insurance premium rates. The key thing to remember is the more times you quote, the higher the chance of saving money. You may be surprised to find that the lowest priced auto insurance comes from some of the smallest insurance companies. These companies often have lower prices on specific markets than the large multi-state companies such as State Farm or Progressive.
When searching for , you should never reduce needed coverages to save money. In many cases, someone dropped collision coverage and discovered at claim time that the savings was not a smart move. Your strategy should be to purchase plenty of coverage at the lowest possible cost while still protecting your assets.