Shopping for insurance is never fun – but having auto insurance is the law. Having the wrong auto insurance for you, however, both wastes your money and leaves you vulnerable when the worst-case scenario strikes.
First, the deductible is massively important. The higher deductible on your plan, the more you’ll pay if you’re found to be at fault in an accident. If you own your home, a business, or other high-value property, you may want to consider buying a stronger policy that helps protect those if worst comes to worst, writes Kelly Blue Book (KBB). Check out Edmunds’ article on “How much car insurance do you need?” to help think through this.
Older cars you own – without any monthly payments going to a car loan – offer a potential money-saving out. Comprehensive and collision coverage, according to KBB, shouldn’t cost more than 10% of the value of your car. In other words: If you’re paying $100 a month for comprehensive and collision coverage, but your car is only worth $1,000, it may not be worth having those options on your policy.
Towing is an option you can compare to clubs such as AAA. Compare the monthly costs and what you get with your membership in an auto club vs. the insurance company. It’s always worth a look to see if you can save a few dollars a month!
For more tips, skimming through the National Association of Insurance Commissioners consumer guide may come in handy. And finally, don’t be afraid to comparison shop! Nearly all trusted sites, including KBB, Edmunds.com, Consumer Reports, and more recommend shopping around. Take an hour out of a day and see if you can save yourself money for the same policy you’d have bought elsewhere.
