How to Save on Insurance Fees: Purchasing Coverage, Filing Claims, Special Programs

Purchasing Coverage

Compare the costs of purchasing a vehicle using other factors besides the ticket price.  Other factors that can influence your purchase decision may be your type of vehicle, credit report, and your insurance risk report.  Ask the company for an estimate of how these reports may affect your premium before purchasing. You can receive your credit report from one of the three major credit bureaus.  An estimation of your insurance risk report can be received from TransUnion.  Also, it would be wise to consider how much gas and general maintenance costs will be required to run a particular vehicle on a daily basis.

As with any loan, the faster you pay the entire amount, the less interest and/or fees will be added to your account.  If you can pay the premium upfront, you save the maximum amount in fees.  Even if you don’t pay the premium immediately, the sooner you pay, the lower your fees.  Also realize that late payments might result in additional fees or even policy cancellation.

If you can help it, don’t add debt from a previous car on your new loan.  This will, of course, increase the repayment time and fees.  Paying at least a 20% down payment will help keep costs under control and avoid the situation where you owe more than your car’s current resale value.

Filing Claims

If your car is repaired after being in an accident, it may now be worth less than the same car that has not been under repair.  Depending on your state of residence, you may be able to make a claim towards this difference.  However, other states do not allow this claim.

Sales tax on any replacement car would be figured on the pre-accident value of your vehicle.  Depending on the rules in your state, you may not have to pay for this sales tax.  It is best to ask your insurance company about their policy in this regard.

If you are in a state where it is legal, you may be able to “stack” uninsured or underinsured motorist(UI/UIM) coverage in order to cover damages.  This may consist of using the coverage of multiple cars on one company policy.  It might also use multiple coverage policies from more than one company.  You will have to check with the company or companies involved to determine eligibility for this coverage.

Teenagers do not have to be added to your auto insurance coverage policy just because they have reached driving age.  You can add them when they receive their permit or license.  Check with your insurance company for their exact requirements.

When changing car insurance companies, make sure to fill out any required cancellation forms and contact the dealer with updated information.  Be sure to provide specific dates.  This will avoid your account being reported to the credit reporting agencies for nonpayment.

Special Discounts

Individuals in some fields of work may get a discount on their car insurance.  For example, teachers, engineers, and scientists may be considered a lower insurance risk.  It might be worth asking your insurance company if your field or specialized degree earns you a discount.

Members of certain associations may receive a discount on the base rate.  Special groups like members of the military and AARP can also receive discounts on car insurance.  Another group that may snag a discount are online users.

Be sure to check with prospective auto insurance companies to find out if you qualify for any special incentives.  This is especially true if you are insuring multiple cars on one policy or are buying homeowner’s and renter’s insurance in addition to auto insurance with the same company.  If you have been with the company for a number of years, this may also be the basis for a discount, particularly if you possess a good driving record.  Still another possibility for a discount are features in a vehicle that reduce risk of damage or theft, such as air bags or an alarm system.

Copyright of newcardetail.com.  All rights reserved.

Return to Main Articles Page