Trimming the Fat: 9 Ways to Cut Auto Insurance Costs While Maintaining Adequate Coverage in 2022

6:00 PM, Mar 15, 2022
Pam Hansen Alfred March 22.jpg

Monthly bills grow quicker than we realize, and we often don’t check-in on our expenses enough to see the adjustments we can make to cut waste. There are savings to be realized in auto insurance. “Just be willing to do a little research to figure out ways to trim the fat,” says State Farm agent Pam Hansen Alfred.

Here are 9 ways Hansen recommends cutting your auto insurance premium.

1. Look for duplicate coverages.

“There might be some coverage on your existing auto policy that’s duplicated,” Alfred says. “For example, in Montana, we have Medical Payments coverage. But if you have adequate health insurance, then Medical Payments coverage may not be needed.”

2. Choose the right vehicle.

Before you buy a car, consider how it will affect your insurance rate. Those fancier, more expensive, gas-guzzling cars typically have higher insurance costs.

Some factors that determine your overall auto insurance price include engine size, repair costs (there is a difference between part costs and available repair knowledge for domestics versus imports), and the risk of theft. Conversely, safety features and technology in some models can discount your insurance premiums.

3. Keep the miles driven low.

Lower miles will maintain your vehicle’s value and less time on the road decreases your risk for an accident. Watching your odometer is also likely to benefit your overall monthly costs.

“Double check with your insurance company to make sure they have the correct mileage annually for that vehicle,” Alfred suggests. “Driving less than a certain number of miles can mean a huge discount.”

4. Keep higher-risk drivers away from the vehicle.

“Check that your insurance company is right about who they have rated on which vehicles, especially when you add kids to cars. They might not be rated on the right vehicle,” Hansen Alfred says. “So, you might pay extra premiums because you don’t have the right driver on the right vehicle.”

5. Raise your credit score.

When an insurance company evaluates your credit score, they’re looking at the probability that you’ll file a claim and this review determines how your credit score affects auto insurance rates.

Higher credit scores result in lower insurance premiums. Check your score regularly and actively work to clear up blemishes.

6. Increase your deductible.

“If you want to reduce your premium, you can raise your comprehensive and collision deductible,” Alfred suggests. “That way, you take on more of the risk while reducing your overall premium.”

Liability, comprehensive, and collision coverages require deductibles, but personal injury protection (PIP) and uninsured motorist insurance coverage don’t carry a car insurance deductible in every state.

Increasing your deductibles requires saving money now while keeping yourself prepared for the future. “Going that route means ensuring you have enough money on hand to cover the higher deductible in case you get in an accident and have to file a claim,” she explains, adding, “raising your coverage to a $1,000 deductible is equivalent to having a savings account with $1,000 in it.”

7. Nix the comprehensive and collision altogether.

A paid-off vehicle is not required to carry full coverage so you could save by eliminating comprehensive and collision coverage altogether. Doing so puts the burden squarely on you, though, if an otherwise covered loss occurs. Other inclusions you could consider dropping to lower your premium are towing and roadside assistance.

8. Pay your premium in full, rather than monthly.

Insurers typically offer a discount if you pay in full. To qualify for this discount, you’ll pay your policy every six months rather than once a month. This can equate to a hefty savings, especially when coupled with other discounts such as automatic payments, bundling, or paperless options.

9. Make sure you’re getting all the discounts for which you’re eligible.

It’s worth reassessing your insurance needs once a year. As circumstances change, your insurance evolves alongside your needs and this can mean savings in all areas of coverage, not just auto insurance.

For example, look for multi-policy discounts that result from insuring your auto, homeowners and other coverage with the same company. Discounts might be available for good driving habits and taking defensive driving courses, too.

For additional money saving tips on your auto, home, business, property, life and health insurance, reach out to Pam Hansen Alfred and her team at (406) 453-6010, stop by their offices at 2817 10th Ave. So., or visit www.pamhansenalfred.com.

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