One of the reasons many people have bad financial habits is that frugality isn’t sexy. The tasks that save you money are generally tedious and time consuming. Finding an affordable car insurance rate is a perfect example. No one enjoys filling out endless forms, searching for quotes, and haggling over the phone.
It’s tempting to make a snap decision and go with the first company that comes to mind. Unfortunately, this isn’t likely to land you the most affordable car insurance.If you can get past the aggravation and spend a couple hours shopping, it’s likely you can save yourself a few thousand dollars over the life of your car. That works out to an impressive hourly rate, and the experience will help you save on future purchases.
Step 1. Do Your Research
The first step to finding cheap car insurance is researching rates. Depending on your location, age, and vehicle, premium sizes can vary significantly (as much as 25%). The fastest way to get quotes is online. You should get online quotes from at least a half dozen major companies to get a feel for the market.
Beforehand you should know what type of coverage you want and how high a deductable you’re willing to pay. This information will make the process faster and generate more accurate quotes. It’s also helpful to ask people in your age range what company was the cheapest for them–it’s likely to be the same for you.
Step 2. Narrow It Down
Once you’ve gotten a range of quotes, it’s time to narrow it down. Generally, the most important factor is cost but there are other points like service and additional benefits that can influence your decision. Depending on your personal preferences, pick out 1-3 companies that seem to fit the best for you.
Step 3. Make the Call
Once you’ve got your short list, it’s time to grab the phone and get some real quotes. Be prepared to pay significantly more than the online rates. In my case the difference was over 30%. The reason for this is that online rates factor in every imaginable discount, making them much lower than the real rate. Although this seems a bit underhanded, all insurance companies do it. Fortunately the comparative prices between companies are reasonably accurate.
Make sure you have your driver’s license, vehicle registration, and current insurance policy on hand. Information from these documents is necessary to get a quote, so save time by having them ready.Do a bit of company specific research, decide exactly what policy you want, and prepare for psychological warfare. The company representative is trained to persuade you to buy more insurance than you need. To entice you, they’ll say that your car insurance premiums will decrease if you buy renter’s insurance or add other options. This sounds good, but you’ll actually be paying more overall.
By deciding on a policy ahead of time, you can tell them exactly what you want without getting confused. When you’re ready, get on the phone and get down to business.
Step 4. Purchase and Celebrate
After you’ve gotten real quotes over the phone, it’s time to make a decision. Go with the best value you can find. Personally, I’m a fan of the lowest price, assuming the coverage is equal. Call back, make the purchase, and bask in the knowledge that you’ve saved yourself a hefty chunk of change.Solid personal finance isn’t about cashing in on the stock market or making big moves. It’s about maintaining the effort and diligence required to get the most out of your money. Now if only you can find a decent auto loan!
Useful info. Getting insurance is a pain, but at least you only need to deal with it occasionally. I’d add that if you want to keep your costs down its important to drive carefully (no speeding tickets) and drive a fairly conservative car. Those are 2 of the biggest factors for insurance rates.
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You also need to re-check your rates periodically. Insurance companies will increase rates on your policy and you need to keep them honest. The company that offered you the cheapest rate initally may not be the cheapest when you renew after the first or second year.
Excellent advice. One more thing to consider: I have found that compared to the major companies AAA offers very competitive auto insurance.
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How do you include in the cost of insurance going down after you are with a company for a number of years? Has anyone else gotten discounts after being with a company for so many years? I received a check from state farm this year because the stock holders decided to give some kind of rebate to customers because they had a good year.
[...] How to Find a Cheap and Affordable Car Insurance RateThe first step to finding cheap car insurance is researching rates. … To entice you, they?ll say that your car insurance premiums will decrease if you buy … [...]
[...] John Wesley wrote an interesting post today on Frugality: How to Find an Affordable Car Insurance RateHere’s a quick excerptThe first step to finding cheap car insurance is researching rates. Depending on your location, age, and vehicle, premium sizes can vary significantly (as much as 25%). The fastest way to get quotes is online. … [...]
[...] John Wesley wrote an interesting post today on Frugality: How to Find an Affordable Car Insurance RateHere’s a quick excerptThe first step to finding cheap car insurance is researching rates. Depending on your location, age, and vehicle, premium sizes can vary significantly (as much as 25%). The fastest way to get quotes is online. … [...]
[...] How to Find an Affordable Car Insurance RateThis post will guide you through the process of finding an affordable or cheap car insurance rate in your area. [...]
[...] info wrote an interesting post today onHere’s a quick excerptThe tasks that save you money are generally tedious and time consuming. Finding an affordable car insurance rate is a perfect example. No one enjoys filling out endless forms, searching for quotes, and haggling over the phone. … [...]
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[...] Affordable Car Insurance RateHow to Find an Affordable Car Insurance RatePingback by Car insurance rate company – Home Owner Insurance Rate – Affordable Homeowners Insurance [...]
[...] Affordable Car Insurance RateHow to Find an Affordable Car Insurance RatePingback by Car insurance rate company – Home Owner Insurance Rate – Affordable Homeowners Insurance [...]
[...] Affordable Car Insurance RateHow does the model of car I drive affect my insurance rates? … buying decisions by taking a few minutes to tell us about your current insurance company. … [...]
Jaci,
Some companies do actually reduce your rates based on your longevity with the company. It usually plateaus at a certain point, but if you stay with the company long enough, you’ll get their best rate regardless of your credit rating.