Are You Paying Too Much For Auto Insurance
Area agent offers nine money-saving tips
If you believe your auto insurance premium "is what it is," you could be paying hundreds of dollars too much, according to Robert Clay, a local independent insurance agent with Indiana Members Insurance Services in Indianapolis.
"Many drivers assume they can't save on auto insurance the same way they do on other products and services," said Clay, whose agency offers Drive® Insurance from Progressive. "The fact is, you can save a significant amount of money by making sure you have the combination of service, coverage and pricing that's right for you." Independent insurance agents sell a variety of companies' products, so they're able to put together insurance packages for their customers that feature best-of-breed companies.
Clay offers nine tips for making sure your auto insurance policy offers you the best value:
1. Contact an independent agent. "Independent agents provide personal service and advice. They also can compare rates from competing carriers, " Clay said.
2. Buy what you really need. Many consumers pay for insurance coverage that doesn't provide the best value for their needs. One example is carrying comprehensive and collision coverage on an older vehicle with a comparatively low market value. "It's important to remember that if you totaled the vehicle, you would only be reimbursed for its fair market value, not for what you might think it's worth or the cost of buying a new car," Clay explained.
Many consumers drop collision coverage when the collision premium equals 10 percent or more of the vehicle's market value (often after four or five years). "You might want to carry comprehensive coverage a little longer than collision."
Do not, however, eliminate uninsured/underinsured motorist coverage from your policy. "Drivers need to protect themselves from the potentially devastating costs of being hit by a driver who doesn't have adequate coverage," said Clay.
3. Consider raising your deductible. Do you really need a $100 or $200 policy deductible? According to the Insurance Information Institute, raising a deductible from $200 to $500 could reduce collision and comprehensive cost significantly. It's true that you'll have higher out-of-pocket expense in the case of an accident, but considering that the average driver files a collision claim once every 8-10 years, you may save money in the long run.
4. Take advantage of discounts. Be sure to ask your independent insurance agent to identify all available discounts to ensure you're getting the best possible rate.
5. Change your life, update your policy. Changes in your personal life, including marriage or moving to a new address, could change your insurance rate. When life changes occur, it may be a good time to visit your local independent agent.
6. Avoid unnecessary towing coverage. If you already belong to an auto club that offers towing coverage, you can save a little money by eliminating this coverage from your auto insurance policy.
7. Eliminate duplicate medical coverage. Many consumers pay for Medical Payment Coverage on their auto insurance policies in spite of the fact that injuries sustained in an accident most likely would be covered under an auto policy simply to cover the deductible on your health insurance. An option could be to carry limited Medical Payment Coverage on an auto policy simply to cover the deductible on your health insurance policy. "An independent agent can help the customer identify and eliminate unnecessary coverages while being sure they have all of the protection they'll need in the event of an accident," Clay said.
8. Pay your premium in full. Some insurance companies offer a discount to customers who pay their premium in full in a single payment.
9. Consider the total cost of that new car. Many consumers shop for cars without also considering the insurance costs associated with various models. "Some models that are similar in size and retail price can result in significantly different insurance rates for the consumer," Clay explained. "Your independent agent or broker can help you track those premium differences beforehand so you don't face an unpleasant surprise after you bring home that new car."
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