Ultimate Guide to Cheap Car Insurance

If you own a car, truck, or other vehicle you are required by law to carry some type of insurance coverage. At a minimum, you are required to carry liability coverage that will cover expenses related to personal injury or property damage. In other words, if you cause an accident and someone is injured or property is damaged, you are responsible for paying for damages.

An insurance policy guarantees payment of a certain amount to cover these expenses should an accident occur. The rates you pay for your car insurance policy are based upon many factors including: age, sex, driving history, credit history, and year, make and model of the vehicle being insured. Other cost factors are determined by the amount of coverage you want.

Comprehensive is the most expensive type of insurance coverage. This type of insurance can offer protection to you, your family, and your car. It covers other things that can happen to your car such as fire, vandalism, or acts of Mother Nature such as hail damage.

Liability is the cheapest car insurance; however, if you do not own your car outright, you cannot purchase liability insurance alone. Lenders require you to have comprehensive insurance covering the vehicle until the note is paid in full.

Liability insurance offers protection to people in other cars when you are at fault for an accident. Typically, liability insurance will cover medical expenses and car repairs, up to a certain dollar amount. In most cases, liability insurance covers you in any vehicle that you drive, whether it belongs to you or someone else.

It used to be that Americans had few choices when it came to car insurance. There were a few major players and they basically had the same rates. Today, there are hundreds of insurance companies eager to obtain your business. The best part is they are offering cheap car insurance rates.

The following tips can help you obtain the cheapest car insurance rates, while making certain you adhere to your state’s minimum insurance requirements.

1. Shop around. Conduct research via the Internet or by phone. Nearly every car insurance agent will provide you with a free quote. It’s a good idea to shop around for competitive rates on your current vehicle. If you’re thinking of buying a new vehicle, obtain quotes for the car you are interested in purchasing. Nothing stings more than to buy a car, only to discover you now have a $400 a month insurance premium. Know your insurance costs before you buy a car, and plan your budget accordingly.


2. Keep a clean record. Both your driving history and credit history are determining factors in the amount of your insurance premium. If you want to have cheap car insurance rates, keep your foot off the gas, obey traffic laws, and pay your bills in a timely fashion.

3. Bundle your insurance. Many car insurance companies offer other types of insurance such as homeowner’s and life. If you buy all your insurance coverage from them, chances are you will receive a significant discount on your premiums.

4. Increase your deductible. One of the biggest mistakes car owners make is to purchase a policy with a low deductible. By increasing your deductible to $1500, you can save up to 20 percent off your monthly premiums. A smart thing to do is to place $1500 in an interest-bearing savings account. The money can draw interest and you will have peace of mind knowing the deductible money is sitting in the bank should you ever need it.

5. Buy online. You can save up to 10 percent or more by purchasing car insurance online. Many insurance companies offer a discount to individuals who set-up automatic payments. This can be done by entering a credit card number or bank account. Each month the agreed upon amount will automatically be deducted from your checking account or charged to your credit card.

6. Buy a more economical car. Insurance rates are partially based on the type of car you drive. If the vehicle has low safety ratings, high theft rates, or high incidence of vandalism, you will pay a higher premium. It’s a good idea to research car ratings prior to purchasing one. Look for cars with high safety ratings and low maintenance costs.