After reading discuss consumer tips for getting the most from your auto insurance dollars
Consumer Tips for Getting the Most from Your Auto Insurance Dollars Consumers can take a number of steps to ensure that discounts beyond those described earlier in this they are not paying too much for auto insurance: chapter. For example, many insurers offer loyalty discounts to drivers who have been insured with the Compare prices across insurers. The cost of per- insurer for extended periods of time and accident- sonal auto insurance can vary significantly across different insurance companies. To assure that they free discounts to drivers who have not had accidents over several years. A growing number of insurers are not paying too much for insurance, drivers are offer discounts to drivers who have installed certain recommended to compare the premiums charged types of loss control equipment, such as onboard by several insurers. (Remember that these prices cannot be shown on a Web site because premiums theft monitoring devices. Some insurers offer sizable discounts to low-risk drivers who agree to install vary across drivers based on their individual risk global positioning satellite (GPS) devices that characteristics.) Consumers also may find useful enable the insurer to monitor driving activity, such information about the insurance prices in their state on their insurance commissioner's Web site, as driving speed, sudden braking, or driving during times of restricted visibility. as many commissioners publish an online compari- son of the premiums charged by insurers (based Adopt low-risk insurance behavior. While some on specific types of drivers) licensed in the state. insurance pricing variables, like gender and age, are largely beyond the control of drivers, others Consider dropping Part D-Physical Damage are within their control and offer opportunities coverage on older vehicles. Auto insurers value a vehicle on an ACV basis, where ACV equals the for premium savings. Thus, drivers can lower their replacement cost minus depreciation. As a result, premiums by reducing the number of miles they they will not provide a large loss payout on older drive, moving to an apartment closer to work, cars or cars with high mileage because the depre- cleaning up their driving record, or improving ciation on such vehicles is quite high. Consumers their credit scores. are advised to consider the cost of insuring physi- cal damage coverage on cars with high deprecia- An important consideration to keep in mind when tion. An industry representative notes that one of buying auto insurance is that sometimes the lowest pre- the most common errors of insurance consumers is mium is not the best choice. For example, a driver can mistakenly buying physical damage coverage on a reduce his premium by buying the minimum coverage vehicle because they overestimate its ACV. Keep permitted in his state, but such actions may be short- in mind that lenders typically will not permit a sighted if he inflicts catastrophic financial damage to car owner to drop physical damage coverage until a fellow driver that exceeds his coverage limits, since they have paid off their car loans. the negligent driver is responsible for the portion of the damage not covered by insurance. Similarly, drivers Consider increasing physical damage coverage should resist buying cheap insurance if the low price deductibles. Policyholders buying physical damage is a result of the insurer offering poor claims service. coverage should investigate how much money they Recognizing that it is difficult for drivers to assess the can save by increasing the size of their deductibles. quality of the service provided by auto insurers, the Premium savings can be sizable, especially for drivers National Association of Insurance Commissioners living in geographic areas with high insurance costs. (NAIC) offers a Web site (https://eapps.naic.org/cis/) Ask about eligibility for premium discounts. that provides information on the complaints filed Insurers offer a growing variety of premium against insurers and other relevant operating data
