The cost of car insurance is a major expense for most people, and rising rates often seem unavoidable. But an increase in your car insurance premium is not always something you can’t avoid. Often, simple errors lead to over-paying for insurance. These eight mistakes are the quickest way to see higher premiums; keep your rates low by keeping them in mind.
Earning Yourself a Traffic Ticket
Tickets are one of the most common reasons that insurance rates go up. Many different traffic violations can be responsible for an increase. Speeding, running right lights, and careless driving are all violations that result in insurance rates that are higher. It takes three years before you will stop paying extra for that ticket. The smartest way to avoid this is to simply follow the rules of the road at all times.
An At-fault Accident
Accidents are just that; something we didn’t expect to happen that happens because of a simply error in judgment. Most accidents are caused by a driver who is either failing to obey traffic laws or simply not paying attention; this makes them for the most part avoidable. What isn’t avoidable is an increase in your insurance rates if you are found at fault in an accident, unless you happen to have accident forgiveness. Even then, it only applies to your first accident, and there are often other limitations. A mistake that leads to an accident is often a mistake that leads to higher premiums as well. Drive safe, be cautious, and stick to the rules to avoid this costly error.
Failure to Shop for Rates Before You Buy a New Car
People often find themselves shocked by the cost of insurance on their new car, but there’s a way to avoid that. Every car comes with a different insurance rating, and some are more pricey than others to insure. When you’re considering options, get car insurance quotes on each possibility before you make a buying decision. If you don’t, it could be a mistake that results in an insurance increase.
Failure to Shop Around at Regular Intervals
Shopping around for car insurance should be something on your to-do list on a regular basis; even yearly. Many people avoid it because they believe it’s a hassle, or think they can’t get a better rate. This is one expensive mistake. People who take the time to shop around almost always pay less; and with internet quoting it’s easier than ever.
Not Reviewing Your Policy at Renewal
Things change, and insurance companies don’t always catch them. You could be missing a discount you deserve, or have a ticket that should have fallen off your record. If you don’t look over your renewal paperwork when it comes in, you could be overpaying. Don’t make the mistake of complacency – look out for yourself and lower rates.
Failing to Take Advantage of Multi-Policy Discounts
What do your home, life, and auto insurance have to do with each other? Well, if you insure them all in the same place, it could be quite a lot – of savings that is. Most insurance companies offer a multi-policy discount. If you don’t have all of your policies in the same place, you could be missing out on some big savings on all of your policies, including your auto insurance.
Not Being Prepared for a New Driver
Inexperienced drivers are expensive to insure; there’s no way around that. But there are ways to reduce the costs, and being prepared ahead of time can save you money right from the start. Before your young driver takes that test, make sure you know about any discounts available such as Good Student or Driver Ed, and get everything you need together. Also, be certain to check on rates for any car you’re considering buying for a new driver; some are cheaper to insure that others. The cost of not being ready for that new driver will be higher rates.
Keeping Secrets from Your Insurance Company
It might save you some money in the short-term to keep quiet about things like a new driver or not mention a ticket when you shop for quotes. But in the long run, it could cost you even more. Insurance may decide to back-charge for the new driver, or could completely non-renew you, leaving you to shop for new insurance with a not-so-good track record. When you’re honest from the start, you can shop around for the best rate and get some help finding it. Odds are good they’re going to find out anyway, so in this case honesty is the best policy.
Keep your rates as affordable as possible by being careful to avoid these pricey errors. Remember that the very best way to keep your insurance premiums low is to be a safe driver; and shopping around is always a good idea when in doubt.