DIY Life

A recent poll that I looked into surveyed opinions about the need for various insurance policies. The survey showed that over 80% of the poll respondents feel that insurance is necessary to some degree. What the poll didn't address was how we feel about paying those nasty insurance premiums.

I want to address the high cost of auto insurance premiums and give you some solid suggestions on how to lower your annual cost of auto insurance by possibly hundreds of dollars. What it all comes down to is how much money you want to save and how serious you are about doing that. Some of my suggestions may require you to change some of your attitudes about your automobile and your driving strategy altogether but when the times are getting tougher and the dollars are getting shorter, it's time to take a serious look at how you do some things.

• Your first strategy for saving insurance dollars is to shop around for your policy. You know who the biggest insurance firms are, make them compete for your money. Be sure that when you are seeking rate quotes, that you are getting quotes for identical rates of coverage. Nothing hurts more than finding out you saved money but lost protection. Print out all quote information you receive and take your time comparing. Don't count out some of the newer insurance offerings that you're seeing on television. There are insurance companies now that specialize in selling you insurance that saves you money. Check out some of those options and try these suggestions from Dollar Stretcher for car insurance shopping.

• When purchasing a new or used car, check with your insurance agent about insurance rates for specific models before you buy. Often times cars which seem quite comparable will have a significant differences in the costs of insuring them. Consider lowering your standards a bit and buy "last years model" or buy a lesser version of the car you desire. Some things such as sound systems and exterior "pimping" can be purchased and installed after-market which may reduce your car's up front insurance premium just a bit.

• Consider alternate ways to finance your auto purchase which will leave the car free from lien. Perhaps you can use some equity from your home or your income may support the loan without need of the car for security collateral. What this can do is to free you from requirements that a lender can enforce regarding deductible amounts and levels of coverage. Most lenders in my region won't allow a deductible over $500. By freeing a vehicle from lien, that deductible amount can be raised and the savings can be astonishing. Raising a deductible amount from $500 up to $1000 can cut as much as 15% off your insurance premium.
  

• Another option, if you can free your vehicle from lien, is to "rewrite" your coverage altogether. In our state, if you don't have a lien holder on your vehicle, you may waive insurance for your individual vehicle. What this means is, while providing insurance coverage for yourself, your passengers, other drivers and other vehicles, you accept all costs for damage to your own car. Because you have no lien holder, you have no financial interests in that vehicle to protect but your own. Yes, you can be taking a serious financial risk but over a period of years you can save thousands of dollars. Typically, dropping collision coverage on your vehicle can reduce your premium expense by as much as 30% but if you wreck that car, you're on your own. It's a strategy which requires serious thought and a bit of nerve.

• Finally, if you have auto insurance, life insurance, home owners insurance or other coverages spread out over a multitude of companies, consider bringing all your policies under one coverage provider. Go to your insurance agent(s) and use the consolidation proposition as bargaining leverage. Make your insurance agent design a scenario that will save you money. You may even want to look into the newer "umbrella" policies which provide coverage for multiple risk categories on one policy with one premium schedule. Properly designed umbrella policies can make maintaining insurance coverage easier and less expensive.

For some additional thoughts about auto insurance, check out our friends at Autoblog. Never let anyone tell you that you can't save money on auto insurance costs. There are always ways to trim that ugly expense. Remember that insurance companies are in the business of holding money. No matter how much they romance you with songs of helpful wonderfulness, the simple fact remains that the less money they pay out to you, the more profit they show. Make your local insurance agent or company work for your money. Be focused and creative about reducing your premiums. With luck, you'll never need to collect on a policy, but if you ever have the need for it, it's nice to have some protection there.