How To Save Money On Your Auto Insurance Policy

Understand Your Policy Terms, Premiums and Payouts 

During the past 35 years that I have represented car accident victims, I am often surprised at the level of misinformation circulating about insurance coverage and policyholders’ rights. 

Insurance is already difficult enough to understand and adding to the confusion are the fears spread through the Internet and by well-meaning friends. 

Here are some common myths could cost you in higher premiums and unfiled claims:

  • No, your rates will not normally increase if you file a claim on your insurance for an accident that is not your fault.
  • No, you do not have to accept used parts for coverage of repairs following your car crash.
  • No, property that was stolen from your car is not covered by most auto insurance policies, but, the stuff stolen from your car is likely covered by your homeowner’s or renter’s insurance policy
  • The other driver’s company will treat you fairly if you do not have an attorney. No, you are not in good hands with Allstate and State Farm is not a good neighbor. Your insurance company is a business, not a friend.

Your insurance company is not going to notify you that you have better options. You have to remain diligent about asking questions and researching lower premiums and better coverage. To make sure you are getting the right price and coverage, you should review your auto insurance policy options regularly and whenever a major event occurs, such as your teen begins to drive, you turn 40 or your new job substantially decreases your commute. 

Actuaries calculate the correlation between age and accidents. Teens have a higher rate of accidents than older adult drivers and so are charged more for their insurance. However, your teen’s good grades, clean driving record and driver’s education can reduce those additional costs. Conversely, your premiums may decline when you and other family members certain birthdays.

Usage-based insurance may lower your rates if you don’t drive often. This makes sense because the less you are on the road, the lower your risk of an accident.

Your credit score also often affects your insurance rates, for good or for bad. Find out whether your insurance company considers your credit history and be sure that the information is accurate the review process is lawful.

Reduced rates are not always the way to go, however. Make sure you are not compromising needed coverage to save a few dollars in premiums. In the long run, you could end up paying more if your bills are not fully covered after an auto accident.

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