If you're looking on ways to tighten your budget, you're not alone. And as a way to save money, people are looking to cut costs on car insurance, groceries, anything!
But with the way commuting and travel outside the home has changed, more people are looking at ways to cut costs on car insurance. After all, the car may be sitting in the driveway a little more these days. Regardless of your everyday financial goals, now’s a great time to think about how you can save money. Don’t assume anything is off the table.
If you're looking to cut costs on car insurance, now might be the time to do so.
In this article, we'll dive into why it's a good time and the top tips you need to know in order to keep those premiums low.
If you've noticed a change in your driving patterns, Pete Karageorgos recommends reaching out to your insurer.
Why? Because returns on insurance are happening right now.
In early October, the Ontario regulator for automobile insurers released a report showing a $1 billion return in premiums to drivers. “This is the equivalent to a 7.1% drop in premiums,” adds the director of consumer and industry relations at the Insurance Bureau of Canada.
Overall, Karageorgos says, one of the best ways to save money is to drive safely. He cautions that demerit points, convictions and at-fault collisions ultimately result in higher rates. So maintaining healthy driving habits and a clean record is a surefire way to keep things in check financially.
If you’re already careful on the road and are looking for other ways to cut costs, you have options. Here are the top four tips
Here’s how you can start saving on car insurance right now.
For any coverage, from car to life insurance, you tend to get the best deal when you shop around at prices.
And choosing a plan a year ago doesn't mean you shouldn't keep shopping around! You don’t have to stick with an automatic renewal of your insurance each year – maybe 2020 is the year for a change.
It’s already a great idea to review your plan on an annual basis to make sure your current premium is the best deal available or if you can find a better rate. Before your insurance is set to renew, spend some time calling around to see what’s available. Ten minutes could save you some cash in the long run. Even if it doesn’t, it never hurts to learn more about the insurance ecosystem so you can make better informed decisions.
It's all about balance, however. You don't want to be changing your provider every few months. “Some insurers offer loyalty discounts for clients who have been with the insurer for a long period,” says Karageorgos. “So jumping around may not be best in the long-term.”
Take some time to see how your insurance stacks up against others out there. You might end up surprised with the discounts available to you with your existing provider.
Either way, you’ll have more information at your disposal and insight into how things work for future personal finance decisions.
Who doesn't love a deal?
Another fantastic way to save money is through discounts.
Depending on your provider, you might have the choice to bundle your car insurance with home or tenant insurance. This could result in some major long-term savings.
Increasing your deductibles is a great way to cut costs. If you are involved in a collision and another driver hits you, you may need to file a claim and pay a deductible.
Deductibles range from $100 to more than a thousand. But if you invest in winter tires, this could decrease the amount you have to pay if you find yourself in an incident.
See if your insurer offers telematics, which provide discounts based on factors such as how far or safely you drive. This will take into account speed, harsh braking and rapid acceleration, giving you metrics that can in turn be used for discounted insurance premiums. Finally, “if you are claims free, check if you qualify for a discount or collision forgiveness that could also save you on your premium,” says Karageorgos.
In addition to shopping around and searching for discounts, you can make adjustments to your current plan. Take a close look at your coverages annually, whether it’s with your insurance representative, agent or broker to determine what changes, if any, can be made.
Let’s say you have collision or comprehensive insurance, which pay for physical damages to your vehicle in the event of theft or fire. If you have an older vehicle, this might be an area you’d like to cut costs on, given the money upfront might not be a worthy investment.
“However, if you have a loan on your automobile or if it is leased, you may not be allowed to drop these optional coverages.” warns Karageorgos.
This may seem obvious, but it can have a pretty big impact on car insurance!
If you miss a payment on your car insurance, there's a chance your insurance will be completely cancelled, which can end up being costly on a few fronts.
For one, car insurance companies may charge you a hefty fee for a missed payment.
Another concern is that, if you lose your coverage, you may end up with higher premiums somewhere else. Missing car insurance payments can even impact your credit score!
An easy way to avoid this? Have your insurance set as an auto withdrawal every month. You won't even have the chance to forget your payment this way!
You don’t always have to overhaul your existing coverage.
Shopping around, finding discounts, making adjustments to your current car insurance plan, or making payments on time are all ways to help you cut costs on car insurance. make better decisions about your coverage and how much you pay for it.
Sometimes, small tweaks and more information can better equip you with the knowledge and skills you need to cut costs.
Now get out there and see where you can save!