What can YOU as a consumer do to reduce your auto insurance rates?
As an independent agent in Phoenix, AZ, I’ve had the pleasure of working with hundreds of clients to reduce their auto insurance rates. Although there are many factors that go into determining the cost of auto insurance, here are 10 tips that will help you attain the maximum discounts available and keep your price as low as possible.
1) Package Policies
Every company offers “Multi-Policy Discounts” that range from 10% – 35% on BOTH your auto and homeowners policies. Take a second to figure out what 35% of your annual premium is… If you have your auto and homeowners insurance with separate companies, that’s the amount you are potentially overpaying!
If you aren’t a homeowner, you can still attain the multi-policy discount by combining renters insurance, motorcycle, ATV, boat, etc. Although these may offer a lower discount than a homeowners policy, it is ALWAYS smarter to keep your insurance with one company.
2) Driver Education
Have you taken any sort of driver training in the last 2 years? Most companies offer a substantial discount for this, but you may need to provide a certificate of completion. These classes usually serve as a means to erase a traffic violation from your record as well, which will help to keep the rates low in the future.
3) Good Student Discounts
Still in school? A Good Student Discount can decrease auto rates dramatically for younger drivers, especially young males. Most companies consider a good student to be above a 3.0 GPA. Some companies have different tiers of discounts based on Dean’s List/Honor Roll, Class Percentile, etc. If you qualify, make sure to ask your agent, but be ready to provide a report card for verification.
4) Company Cars
If the company you work for provides you a vehicle, you may qualify for a substantial discount on your personal auto policy. The idea behind this discount is that you will be driving your vehicle less since the company car will be used for commuting. If you drive your car less than the average person would, there is less chance of getting into an accident, which results in a better price!
5) Association Memberships
This usually applies to AAA Members, but many insurance companies have arrangements with different associations to provide discounted rates to members. Make sure to let your agent know any association you are a part of to find out if you qualify.
If you pursued any type of education after high school, you may qualify for a discount. There are different tiers for each company, but many companies give a discount for: associate’s degree, bachelor’s degree, doctorate, etc. Even if you only completed a portion of higher education and didn’t get a degree, some companies will still offer a discount.
7) Aftermarket Alarms
Most vehicles 2001 and newer have “Passive Alarms” meaning that they turn on automatically when you lock the car. When an agent plugs in a VIN # for a vehicle, it will automatically generate the type of FACTORY INSTALLED alarm. This means that if your car is older than 2001 and you don’t notify your agent of an aftermarket alarm, you are missing out on the discount.
8) Accident Records
Every company requires agents to run an M.V.R. report and a Loss History report prior to binding coverage. These reports track any claim within the past 5 years tied to; your name, address, or even a previous address or policy that you were listed on. Often times Loss History reports come back with an accident that may belong to a previous household member. Unless the agent excludes these, they are counted against you. This happens more than you think, so make sure you aren’t paying for somebody else’s mistakes!
9) Automatic Payments
Almost every company I represent offers a discount for EFT payments (Electronic Funds Transfer). This will typically reduce the rate and ensure that you don’t miss a monthly payment and get hit with a late fee. Although this historically required a checking or savings account, most companies now offer this through a credit card as well.
10) Pay it in Full
If you are in a financial position to pay for the policy in full, some companies give up to a 10% discount! This can be paid via credit card or EFT transfer.