Car insurance is fairly expensive in Texas. According to a recent study done by Insure.com, the average car insurance premium in the Lone Star state came in at $1,779 which makes it the tenth most expensive state in the country for car insurance.
While you are definitely going to spend more on car insurance in Texas than in Maine (the cheapest state for car insurance) there are ways to keep your premium affordable. Here are just a few tips for lowering your car insurance costs:
Shop Your policy: This is by far the best way to lower your insurance costs. Insurers rate risk differently so premium quotes can vary dramatically. Always make sure you are comparing apples to apples when it comes to coverage levels and deductibles.
Industry experts recommend shopping your policy one a year and getting quotes from 3-5 insurance companies before making a decision. When shopping for a new policy, remember that it is important to make sure the company you choose is financially sound. While a low-cost policy is always great, if you have problems when it comes time to make a claim, it may not seem like a bargain.
Always check the financial health of insurance companies you are considering with rating companies such as A.M. Best (www.ambest.com) and Standard & Poor’s (www.standardandpoors.com/ratings).
Up Your Deductible: The deductible is the amount you have to pay before your insurance policy kicks in and covers the rest. If you can afford to up your deductible this is a great way to lower your premium. Doubling your deductible from $500 to $1,000 can often result in a 30-40 percent premium drop. Always choose a deductible that you can easily afford in the event you have to make a claim.
Drop Coverages: If you are driving an older car, or you have an older car on your policy, consider dropping collision and comprehensive to put some coin back in your pocket. A good rule of thumb is that if you would replace the car instead of repairing it if it was in an accident, it probably doesn’t make sense to carry collision or comprehensive anymore. You should never drop liability coverage on any vehicle, it is a required coverage in all states and can lead to financial ruin if you are in a major accident without liability insurance.
Get Quotes Before Buying a Car: Whenever you are shopping for new car, always get insurance quotes on any of the vehicles you are seriously considering. Insurers take lots of factors into consideration when setting a premium which means that similar cars can have dramatically different premiums. Theft rates, accident rates and the cost to repair the vehicle are just a few of the factors they consider.
Gather quotes on all vehicles you have on your short list so there are no surprises after you have signed on the dotted line and driven your new ride off the lot.
Bundle Up: Insurers offer a significant discount to customers that bundle multiple lines of insurance with them. If possible, always keep your homeowners or renter’s insurance with the same insurer you use for your cars. While we highly recommend bundling, it doesn’t always result in the lowest price, in some cases, using different insurers for your various coverage's can result in a lower premium so make sure you shop around and keep an open mind.
Keep Your Credit Score Up: Insurers rely heavily on a person’s credit score when setting a premium so if you have a low credit score, do what you can to get it back in acceptable territory. Insurers rely on data and statistics and they show that drivers with strong credit scores are involved in fewer accidents and make fewer claims.
If possible, pay all of your bills on time, pay down any debt and check your credit score on regular basis. If you find errors on your credit report, have them corrected as they could impact your score.
Discounts Matter: Insurers offer all kinds of discounts and they can have a major impact on your premium. Have your agent do a discount review to make sure you are getting all of the discounts you are qualified to receive. While some discounts may be small, they all add up and that can result in significant savings. Here are just a few common discounts:
- Anti-theft Devices
- Defensive Driving Courses
- Drivers Ed Courses
- Good Credit Record
- Long-Time Customer
- More than 1 car
- Safe Driver
- Student Drivers with Good Grades
Professional Groups: If you belong to a professional group, alumni association or your workplace has a deal with an insurance company you can often get discounted group rates. Ask your employer if they offer this type of benefit or check with any professional organizations you are affiliated with.
Defensive Driving Course: Insurers will often offer a discount if you attend a defensive driving course. This is especially true if you have a teen driver on your policy, putting them through a course will almost always lower your premium. Check with your insurer for a list of approved courses.
We can help you shop your coverage and make sure you are getting all available discounts. If you are ready to lower your car insurance premium, contact us today.