Understanding Insurance Terminology

Understanding Insurance Terminology

Easy Ways To Save Money On Car Insurance

by Vilma Maki

One of the most expensive parts of owning a car can be paying your car insurance. In some places, it is not uncommon for your monthly car insurance payments to be equal to a car loan payment. With such steep insurance prices, it helps to  know how to reduce your car insurance premium to a reasonable rate.

#1 Pay All At Once

Your car insurance premium is renewed every six months. You have the option of making a payment every month for your car insurance. You also have the option with more car insurance providers of paying your entire balance all at once. That means paying your entire premium twice a year.

The savings is not huge, but you can reduce your premium a couple of percentage points by paying all at once. Every percentage point that you reduce your premium adds up. The next time your car insurance premium renews, try saving up to pay it off all at once instead of opting for monthly payments.

#2 Allow Your Car Insurance Company to Monitor Your Driving Habits

Next, allow your car insurance provider to monitor your driving habits. You can install a device that plugs into your vehicle for a couple of months. This device measures how fast you drive and how you stop. It keeps track of the time of day that you drive, as well as other driving habits.

All of this data gives your car insurance provider a clearer picture of how you drive and the risk that you present when you drive. Oftentimes, after you allow your insurance company to install a monitoring device for a couple of months, your insurance company will then lower your insurance premiums to fit your specific driver profile. Many drivers see significant decreases in their premium after they participate in a program like this.

It is important to note that the monitoring device doesn't stay in your vehicle forever; you only have to use it for a few months to enjoy the discounts that it provides.

#3 Compare Your Rates Once a Year

Your car insurance premium is renewed twice a year with your insurance company. At least once a year, get online and compare rates. There are tools you can use to easily compare rates. Comparing rates will not have an adverse impact on your service with your current provider. This is just a way for you to see if any other insurance provider can offer you a lower rate. If you find a lower rate, you can either switch right away or call your current car insurance provider and see if they will match the other company's rate.

If you want to easily lower your car insurance premium, shop and compare at least once a year, and use that information to lower your rate. Save a few percentage points off your premium by paying it all at once instead of in installment payments. Install a monitoring device for a custom risk plan that has the potential to dramatically lower your auto insurance rates.


About Me

Understanding Insurance Terminology

After we purchased our first home, we realized that it might be a good idea to evaluate our insurance coverage. Although we had purchased homeowners insurance before, we had never owned a policy as large as the one we would need for our new place. Also, our new home had a trampoline and a swimming pool, which made us worried about liability. To iron out the details, I decided to meet with our insurance agent. We talked about things like monthly premiums, coverage limits, and deductibles, and it was incredible to learn more about the terminology. This blog is designed to help you with the same types of questions.