Some factors that can affect your car insurance premiums include your car, your driving habits, demographic factors, and the coverages, limits and deductibles you choose. These factors can include factors such as your age, the anti-theft features of your car, and your driving history. Establishing a strong credit history can reduce your insurance costs. Most insurers use credit information to set the price of auto insurance policies.
Research shows that people who manage their credit effectively have fewer claims. To protect your creditworthiness, pay your bills on time, don't get more credit than you need, and keep your credit balances as low as possible. Review your credit history regularly and correct any errors right away so that your record remains accurate. Take our 3-minute questionnaire and talk to an advisor today.
Founded in 1976, Bankrate has a long history of helping people make smart financial decisions. We've maintained this reputation for more than four decades by demystifying the financial decision-making process and giving people confidence in the actions they should take next. The average American spends about 2.6% of their annual income on auto insurance, which represents a significant bill for many households. However, with the rise of remote working, many drivers' habits have changed, and so may other factors, such as the cost of car parts and repairs, that could affect the cost of their car insurance policy.
If you haven't compared rates or evaluated your coverage recently, you may be overpaying for car insurance. While reducing your monthly payment may seem complicated, Bankrate can help by offering you some simple tips for reducing your premium. Each of the car insurance companies has their own methods for calculating rates, and your own individual rating factors play an important role, so you won't know how much car insurance can cost with other companies unless you request a quote. The first is to have an independent insurance agent or broker compare car insurance rates from several companies for you.
If you want to lower your car insurance rate, but your credit score is lower than ideal, you can take steps to improve it. Because these factors, as well as others, such as the make and model of the car you drive, influence the underwriting process and the final rate you pay, the best provider of cheap car insurance will be different for everyone. Because your insurance company will offer you multiple options for your deductible amounts when you buy car insurance, it may be worth considering higher deductibles to lower your premium. However, in all other jurisdictions, how well you pay your bills and other credit factors are likely to affect your car insurance costs, even if you have an impeccable driving record.
Since the advent of telematic technology that allows auto insurers to set the price of policies based on how much and how well a person drives, most major insurance companies have adopted usage-based insurance programs as an alternative to conventional policies. You can save money by buying car insurance from a company with which you already have other types of insurance, such as home insurance.