Save Money on Insurance
How to ensure high premiums don’t drain your budget.
Insurance isn’t one of those expenses you can just decide to live without – you have to have insurance if you want to buy a car and own a home. So it’s definitely a necessity in your household budget. Still, there are ways to minimize the cost so the necessity doesn’t become a necessary evil that completely drains your budget every month.
By shopping around for insurance regularly and comparing rates, you can keep the cost as low as possible to help maximize the cash flow you have available for other things, like saving for retirement. Here is what you need to know to minimize your insurance costs so you can maximize your savings…
Tips for cutting auto insurance costs
Auto insurance costs are determined by how the underwriter assesses your risk as a driver, combined with the risk of the vehicle you own. In some cases, depending on where you live, the insurer may also consider your credit-based insurance score, which means your ability to manage debt and maintain good credit can also impact your premiums.
When assessing your risk, auto insurers look at your gender, age, driving record, marital status, prior coverage, and how urbanized the area is where you live. In states where credit-based insurance scores come into play, they also make look at your credit. Then they take into consideration the make and model of the vehicle to be insured and the mileage on it.
The amount you pay varies based on the type of coverage you have, which in turn varies by state. Some states have no-fault auto insurance standards where the insurer pays directly for any losses. Other states have tort insurance which offers different types of coverage based on what you need – these are the states where you see everything from comprehensive coverage to collision coverage.