How to save on car insurance

Car insurance is expensive, but there are some great ways to save that might even surprise you.

First, of course, the easiest way to pay less for car insurance is to self-insure as much as you can. Cut costs by including high deductibles (within reason) in your policy choice; insurance premiums are cheaper with higher deductibles because companies don’t want to process small claims that you could potentially pay for yourself. Decide how much you’re willing to set aside for smaller car emergencies, and set your deductible slightly below that number. Also, don’t pay for towing insurance. Instead, don’t let your car run out of gas, and always keep a spare tire in the car (and make sure you know how to change it!). If you do these things, you will only need to be towed if your car breaks down, and that will probably happen rarely enough that it’s worth it to just pay out of pocket. Keep in mind that collision insurance often includes towing after a serious accident.

Next, keep your insurance in one place as much as possible. Often, you’ll get discounts for keeping your homeowner’s and car insurance policies with one company, and it will also help you avoid double-counting specific aspects of your policy.

Find out if you can “prove” that you’re a low-risk customer. For example, many insurance companies offer discounts for people who complete defensive driving courses or don’t drive very much during the average month. Increasingly, another option is coming to light: tracking devices. These little gizmos send the insurance company data about your driving habits, and if you’re a careful or infrequent driver, you can save money on your premium.

Another tip: don’t pay monthly. If you can, pay six or twelve months in advance, because most companies offer lower rates if you pay your premium in larger chunks. As long as you’re happy with your insurance company and you’ve chosen one you like, don’t overpay just for the change to pay month by month.

Finally, shop ahead. Look at insurance policies before you buy your next car, and don’t assume that you know which cars incur the highest insurance costs. The real information might surprise you! Shopping ahead also means reading through policies to make sure you’re buying only what you need: use common sense to choose your policy and your car, and you’re well on your way to a reasonably priced insurance policy.