If you feel a sense of dread whenever your car insurance bill arrives, you are not alone. With most states currently mandating that all vehicles operated on public roads have coverage for financial liability, the monthly car insurance premium has become a fixed expenditure in most American households.
Some of these households, however, may be paying higher than average car insurance premiums without fully understanding why and how the problem might be successfully addressed. Vehicle owners who would like to enjoy cheaper car insurance premiums can use the following information to help them better understand the problem and read about solutions that might help their situation.
Is the driver part of the problem?
One of the first things to consider is whether you, or other drivers in the household, are part of the reason why you are paying high car insurance premiums. If your DMV record, or those of another driver in your household, shows citations for speeding, careless and imprudent offenses, or DUIs, your insurance is likely to be a more expensive policy designed for higher-risk drivers.
Insurance companies routinely track and use data that proves that drivers with poor driving records are more likely to be involved in an accident than those with few or no negative entries on their driving records.
Drivers who are currently paying for high-risk car insurance may find cheaper rates by taking one or more of the following steps:
- complete a safe driving course and begin immediately to improve driving habits
- ask your insurance provider about installing a monitoring device in your car in exchange for a reduced rate
- look for discounts by pricing insurance with other companies
Households with teen drivers on the policy may also be classified at higher risk. Using a family vehicle to earn money with a ridesharing app or food delivery service can result in higher car insurance.
Drivers can also see higher insurance premium costs due to financial issues. Some insurance companies use information from the major credit bureaus in computing risk.
Drivers who have negative information on their credit reports may be lumped into high-risk categories and charged higher rates for their car insurance. It can be helpful to monitor credit reports regularly and take action to correct any erroneous information.
Are your vehicle choices raising rates?
Once you have considered whether you or other drivers in your household are contributing to higher insurance premiums, you will want to take a look at the vehicles covered under your auto insurance policy. Auto insurance companies compile data on vehicles, much like they do on drivers, that help them decide which makes and models are most at risk of being involved in an accident or being targeted by thieves.
Cars that are considered to be sports or high-performance models are routinely viewed by auto insurance companies as risky. In addition, the vehicles that are most targeted for auto theft will also be considered high risk, including many of the newer, most popular models of cars, trucks, and SUVs.
Newer cars can be much more expensive to repair after involvement in an accident. Some of the extra expense is because less expensive aftermarket parts are not yet available. Instead, auto repair shops must source replacement parts directly from the manufacturer, usually at a premium price.
Drivers who have high auto insurance bills and one or more new, sporty or high-performance vehicles in their driveway may want to think about replacing some or all of their current vehicles with models that will be less expensive to insure.
Finding cheaper car insurance rates can be an important factor in improving the financial health of your household. To get started, make an appointment to discuss your vehicle insurance goals with a cheap car insurance provider in your area.