Amy Patterson is an avid reader on trending topics and a writer in her spare time. On the beautiful east coast you will usually find her catching up on the latest news with locals or on the beach with her family. She loves to write pieces on health, fitness, and wellness, but often writes about family and saving money.
For many young adults, car insurance can be a large expense in the monthly budget.
Many can find themselves questioning if the cost is justified, and if they are paying for the coverage they really need or just bogus additions that insurance companies include to bring in more revenue.
Some young individuals who might just be starting out may ask themselves “How can I reduce my bill but still maintain the coverage I need?" There are some factors out there beyond out of their control (age, gender, school status, etc.). These possibilities can have a major impact for keeping saving money.
Tips for shopping for car Insurance
- First and most important is to shop around. Don’t purchase based on the first insurance quote received, as many young people and families should consider what best applies to their situation. The prices of some companies can be almost double that of competitors with comparative coverage. Price is not always a factor in quality. Sometimes the cheapest insurance actually includes better coverage than much more expensive providers.
- Conduct a general web search of independent sites that show multiple quotes to compare the rates in your state. A higher deductible (what you pay before the insurance will cover expenses), will make it possible to save somewhere between 25-40% in premium costs. However, this is purely in upfront costs. Each individual has different needs.
- It's advised to reduce coverage on an older car model. If the cost of your older car is less than ten times the cost of the premium, than the coverage might not be worth the expense. To find out the value of a car, contact a local car dealer or a bank. There are also online sites that can provide easy appraisal and comparisons.
- Many young people are just learning about getting and maintaining good credit. It is important to remember that a good credit record can play a significant role in the insurance rates available to any consumer. Check credit scores periodically. If there is any incorrect information on your credit history, get it fixed immediately. Credit utilization rate is also a major factor. Make sure your balances are as low as possible.
- Keep track and pay all bills on time. Like most adults, young people find that keeping a monthly schedule of when their bills are due can be helpful in order to budget their income.
Most common discounts offered for car insurance
- Some young adults don't drive their car very often, but still need insurance, such as college students who live on campus. It would be beneficial to ask if the company offers discounts for low mileage or even good student rates. Keep in mind that accidents are inevitable, so insurance is a must. According to Miller and Mixon, car accident lawyers, “If you choose to settle your dispute with the at-fault driver without involving the insurance companies, you can expect to receive prompt payment.”
- Most young people find that carpooling can also be an efficient way to save money on extra expenses as well. Price reductions on a group basis are given to people who belong to certain social groups, clubs or work for an insurance company's preferred businesses.
- If there is more than one vehicle to insure, you may get a discount by using the same insurance company. Many insurance providers offer discounts in these situations. It doesn’t necessarily have to be two vehicles. For those who might have graduated and settled in their first home, home insurance and car insurance from the same company could qualify you for a discount.
Other types of discounts
On top of the discounts mentioned above, there are also many situation-specific discounts that providers offer. Discounts for policy holders that don’t have any violations or accidents for multiple years, policies for students with good grades, long-term customers, owning anti-theft devices, and college students who don’t live at home are just a few.
However, just because a company offers numerous discounts doesn’t necessarily mean it's the right choice. It all comes down to your risk tolerance and personal goals.