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10 Ways To Reduce Your Car Insurance Bill

One of the biggest expenses we have is often our car insurance, auto insurance premiums continue to rise at a staggering rates, just recently Ontario approved a new premium increases of up to 19%. This is especially frustrating for those with good driving records and no claims, "what can I do to reduce my premiums?" asked a friend of mine recently. Here are a few ways one can offset the increasing insurance costs.

1. Shop Around

The first thing you should always do when trying to save money is to shop around. Use online services such as Kanetix to obtain several quotes from different companies, most companies now also offer online quoting tools, which can save you time. Although the auto insurance industry is highly regulated every insurance company has a target market, just because you do not fall within one insurers target market doesn't mean you will not be able to find a reasonable rate.

2. Increase Deductibles

A very common way to reduce your premiums is to increase your deductibles. Often you have a deductible on the collision and comprehensive part of your coverage by increasing this deductible you will reduce the premium on that portion of your policy thereby reducing your premium.

3. Low Mileage Discounts

Discounts are another good way to reduce your coverage, however most discounts are not very obvious. Many insurers offer low mileage discounts, so when you are getting a quote ask if they offer this discount and if you qualify for it.

4. Check Insurance Before Buying

When purchasing a car keep in mind the insurance costs, look for make and models that cost less to insure. When you narrow down your list check with your insurance company about the premiums.

5. Keep Good Credit Score

Recently some insurers have began to pull credit reports when purchasing insurance, if you have a bad credit history it can actually cost you more in premiums. So try to keep a good credit rating to receive the best prices.

6. Group Discounts

There are many affinity group insurers out there chances are you may fall within one group. Check for those who provide a discount for alumni members and professional association members, often these can save you about 25% in premiums. A few years ago I switched to an affinity group and it reduced my premium by 30%.

7. Continuous Insurance

The longer your insurance history the better rate you can get, up to a limit. Try to avoid any lapses and gaps in your coverage, if you can prove you have had continuous insurance for several years the insurer may provide you with a better rate.

8. Other Discounts

Many companies have different discount plans for their target market, ask what time of discounts the company provides and what the eligibility criteria are for them. Few common are loyalty discount, claims free discount, retiree discount and anti-theft discount, the more discounts you qualify for the better for you.

9. Remove Collision and Comprehensive

If you have an older vehicle than consider removing collision and comprehensive coverage from your policy. Collision covers you vehicle when involved in an at fault accident and comprehensive covers other damage to the vehicle not due to an accident. On older cars the premium charged for this coverage is often more than the car is worth and removing it can save you around 40% in your premiums.

10. Combine Policies

If you currently have home and auto insurance with different carriers then combine them to save on both. Often companies provide about 15% discount on your auto policy if combined with a homeowners or tenants insurance.

As more cars are out on the road and more claims are paid out the insurance costs will only rise. Some of the above tips can help you reduce your costs.