How to Save Money Insuring Your Older Car
You may have decided not to buy a new set of wheels to save money. But you may not know that owning an older car can also help you reduce your auto insurance premium. Many car owners don’t take the time to update their insurance policies, so they wind up insuring their older vehicles for more than they are worth. Make sure to find out how much coverage you really need, before you get auto insurance quotes.
Determine car’s value
If your car is totaled, your insurance company will cover the vehicle’s current value, not it’s original sticker price years ago or how much money you have sunk into it all these years. So, it’s important for you to know your car’s market value. You can get an estimate of your vehicle’s current value at Kelley Blue Book’s Web site, www.kkb.com, or Edmunds’ Web site, www.edmunds.com. You can also ask auto dealers and your banker for your car’s worth. Know your car’s value, before you get auto insurance quotes.
Drop collision and comprehensive
Once you know your car’s current value, you can determine whether you need collision and comprehensive coverage. The Insurance Information Institute recommends you can drop this coverage, if your vehicle is worth less than 10 times the premium. Put another way, it does not make sense to pay comprehensive or collision on a car worth less than $1,000, because any claim payment you receive would not substantially exceed your premiums minus the deductible.
Raise your deductible
If you don’t want to get rid of your collision and comprehensive coverage, you may want to consider raising your deductibles. Your deductible represents the amount of money you pay before your insurance policy makes a payment on a claim. With a higher deductible, you can lower your costs substantially. Increasing your deductible to $500 from $250 could reduce your collision and comprehensive coverage cost anywhere between 15 percent and 30 percent. Going to a $1,000 deductible could save you 40 percent or more, according to the Insurance Information Institute. Claims occur on average only once every 11 or 12 years.
If you want to trade in or sell your junker, find out how to buy a new car that won’t drastically increase your insurance rates. The latest model on the dealer’s lot, for instance, is the most expensive to insure, because the car is worth more than earlier models. As a general rule, older cars are less expensive to insure. You may want to find out how much a model’s value will depreciate over the years, before you get auto insurance quotes.
When you are ready to buy a new policy, you can call agents in your local area, contact insurance companies directly or use InsuranceQuotes.com to instantly get competitive auto insurance quotes from the nation’s leading insurance providers. Simply fill out a simple online form on InsuranceQuotes.com to find the right insurance coverage at the best possible price. Take the time to protect you and your family today.