How to Get the Lowest Car Insurance Premium

Posted on September 6, 2008
Category: Buying Car Insurance | Leave a Comment

The first rule of thumb is don’t sign up with the first car insurance company you find. Never buy until you have compared the policy’s of at least four or five insurance companies. If the thought of parading from one company to another doesn’t thrill you then use the internet. Simply fill in standard information like your location, age, gender and car details and you will be provided auto insurance quotes from various companies in a matter of minutes.

There are some things you should know upfront in order to secure the best car insurance rate. Understanding how insurance companies determine their premiums is essential to gaining the best rates.

Insurance providers want customers who are ‘low risk’. This means that you will need to convince your insurance company that you are a careful driver who is not likely to make a claim.

If you do make a claim insurance companies assess how much they will likely have to pay and this is factored into the premium. If you have a history of road accidents stretching back as much as six years or tend to receive a fair amount of speeding tickets then you will likely be assessed a higher premium. If you drive an expensive or new car you will pay more as well - due to a higher repair cost for the vehicle. The amount you pay for the premium is directly related to all these factors.

There are a few other factors as well. The frequency in which you use your vehicle and the distance you travel daily will increase your risk of accident. The neighborhood you live in also effects your insurance rates. Less desirable locales increase the chances of theft and vandalism.

Once you have found the best insurance for your situation don’t become complacent. Over time you can become eligible for a reduced rate based on your history. Most people fail to check out discounts for drivers with a clean track record. Your car insurance provider will get a clearer picture of what kind of driver you are and your ‘riskiness’ can decrease over time. This means that you may be eligible for discounts that were not made available to you when you first took out the policy. You should review your policy yearly in case you qualify for discounts.

These are but a few of the things you need to take into account when shopping for car insurance. In fact, there are many more details you can work on to secure a better quote. The key is to be informed and shop around before purchasing auto insurance.

Drive safe.