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7 possible ways to reduce your monthly auto insurance premium

January 30, 2013

While fuel efficiency is a critical factor in countries like India  the monthly insurance premiums in countries like Canada adds up in your credit card bill and makes a notable impact. Lets look into five important factors that you need to take into account to reduce your insurance premium

Well, we all know that the age is one of the important factor influence your insurance premium. Well as we look out of such things on which we don’t have much control on, there are always certain levers through which we can have optimal control on our insurance premiums. Lets look at some of them.

1) The balance between the old and the new.
As the principal amount insured on a new vehicle is quite high, the premium tends to be a higher too. The older the car gets the lesser the insured value, and eventually the insurance premium. However, that’s not always the case. Often, it turns out the older cars has lesser safety features, and more the risk of loss, which in turn fuels the increase in insurance premium. So its always the optimal balance between the age of the car, and features preferred by the insurance companies, that gives you the scope for saving that extra money in the premium.

2) Drive less
Yeah it sounds stupid, then whats the point in buying a car? But what I try to mean here is that, drive for and when needed. Sometimes, small efforts can make big changes. For e.g. if you have a convenient public transportation for your office, you can avoid driving a car and take public transit. This could save you significant bucks, not just in insurance premium ,but in parking too & fuel too. Insurance companies tend to decrease the premium rate for people who drive lesser miles/km.

3) Insurance as a factor in your buying choice

The best precautionary measure that one can take in reducing his/her monthly auto insurance premium, is considering the insurance premium as an important factor for making a purchase decision on your car. Reach out to an insurance agent, provide him with your choice of cars, and get insurance premium quote for each of your selected model, and choose the best fit for you.

4) Voluntary deductible

Do you have this question in your mind – ‘I am confident that I will drive safe, I really don’t want to pay this much for my premium’ , then voluntary deductible in a car premium insurance contract is a good option for you. This means that, you can actually volunteer to take part of the risk on yourself and in turn, you get to pay less monthly premium. But remember, in case of an accident, you might have to shell out more money from your pocket to cover your loss

5) Buying multiple insurance coverage from the same company

Most of the big insurance companies offer various insurance products under their portfolio. For example, the same insurer might offer home, auto, travel insurance etc. Often, when you buy two or more insurance coverage from the same company, you get significant discounts on your premiums. You can go for a recognized and reliable insurance company in your city, and buy all your insurance needs from that particular company.

6) Have a safe driving record

Not but not the least, probably this is the best solution to keep your premiums low in a long term basis. Drive safe, build safe record in your driving regulation authority’s database, and you are given discounts automatically.

7) Build your driving history

Drive your own car to build a strong driving history. I have heard people sold off their personal car, fearing higher insurance premiums, and rent a private car every weekend. That might save you some fixed costs of owning a car, but it wont help you build a profound driving history, which is important too.

Happy saving on your insurance premiums !

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