We are all looking to shave down our costs wherever we can. If you’re wanting to increase your savings to just more than what’s accumulating in your car cup holder, than you may want to think about how much you’re paying to insure your rolling piggy bank. Below are a few reasons to take another look at how much you spend on auto insurance.
1. You’ve had the same insurance policy provider for years.
Over time, your insurance rates can increase. If you have automatic payments set up to cover your policy, you may not even notice the rising cost of your vehicle insurance. There are many reasons why your insurance company will raise the cost of your insurance, even if you haven’t made any claims. It’s a good idea to annually compare your rate with last year’s and even to shop around for better quotes. This is a prime example of how being proactive can save you some money.
2. You’ve recently become a home owner.
If you have stopped renting and taken the plunge of owning a home, then you may want to look into bundling your home and auto policy. Many providers will offer a discount for having both policies with them, and the incentives can be attractive enough to lower your existing auto coverage rates.
3. You’ve moved to a new area.
If you happen to have acquired a new home (or simply moved to a new apartment) you’ve probably just changed your zip code, and that is reason enough to look into your auto insurance price. This is an often-overlooked reason to re-evaluate your insurance provider. One of the major factors that determines your coverage cost is where you park your vehicle. If you live in an area where car theft is common, your rate will be higher to offset the likelihood of having to make a claim on your vehicle. If you move to a home where there are fewer vehicles on the road, your rate just may come down due to the lower risk of colliding with another car.
4. You just got married.
Tying the knot can lead to more financial security. Having two incomes to draw on to cover all of the household expenses can feel like giving yourself some room to breathe when looking at the monthly bills. However, don’t let that blind you to the fact that you could be saving money. Now is a good time to look into getting a new auto insurance coverage quote. Things like marital status affect how your rate is calculated according to CNBC.com. It is important to point out, however, that if you have entered into holy matrimony and said “I do” to someone with a poor driving record, you may end up paying more.
5. You have had another birthday.
It may be tempting to stop counting your birthdays after 21, but in reality, you should be looking forward to some plateau ages when it comes to paying for car insurance. Your age and accumulated driving experience can change the amount you pay. For example, a 30-year-old with a clean driving record will pay substantially less than an 18-year-old with no claims.
6. Your credit score has improved.
You may notice that a lot of the things on this list seem to happen as a result of one another. But, they all still directly affect the amount you pay to insure your vehicle. You’ll notice that as you get older, get married, and buy a home you’ll tend to have more financial security and as a result, a better credit score. Your credit score plays a factor in determining your car insurance premiums as explained by Nationwide. Your credit score can have direct correlation to the likelihood of you making your insurance payments regularly and on time. As you can guess, a consistent paying customer is much cheaper to insure, and therefore if your credit score has gone up, your rates may just go down.
Overall, any time you are wanting to save money you should be looking at your auto insurance premiums. If you research starts turning up information about vehicle service contracts, remember that these two types of coverage are very different! An insurance policy will generally cover different things than a vehicle service contract, so it will be useful to understand the difference.
While the aforementioned 6 reasons are strong factors in determining your coverage rates, there are many more that can affect the cost of your premiums, both positively and negatively. It’s important to point out that changing your insurer frequently can be detrimental to your rates, and you should be aware that significantly lowering your premium usually means less coverage so you should be looking at what the quoted policies cover as well as the price.