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With the rising costs of, well, everything these days, many people are taking a hard look at their finances to see where they can save money each month. From buying in bulk to save money on groceries to carpooling to save money on gas, cutting costs is definitely top of mind.
Another way savvy spenders are cutting costs is by looking for cheaper car insurance rates. Is exploring inexpensive car insurance coverage on your to-do list? Here are three tips to help you find the best car insurance coverage possible:
1. Understand How Your Credit Score Impacts the Cost of Insurance
Unless you live in California, Hawaii, Massachusetts, or Michigan, it’s important to know how your credit score may impact your rate. If your credit score is considered “good,” you need not worry. However, if your credit score is considered “fair” or “poor,” you could potentially be asked to pay hundreds of dollars more per year.
It’s also important to know the credit score insurance companies use isn't exactly the same as your FICO or Vantage score. Instead, companies rely on a credit-based insurance score, which takes many of the same factors into account but weights them differently.
Because of this, having little or no credit history, too many recent inquiries on your credit record, and high credit card balances could have a much bigger impact on your credit-based insurance score compared to your FICO score. Keep these factors in mind as you begin your quest for cheap car insurance.
2. See What the Experts are Saying
Sure, every car insurance company will give you a laundry list of reasons why you should choose them over the competition. But what are the experts saying? Whether you’re at the beginning of your search or you’ve narrowed your list to two or three solid options, it’s a good idea to seek out expert opinions on cheaper car insurance companies, too. Not only will this give you unbiased information, but in many cases, a lot of the legwork has already been done for you. Indeed, that can help you save lots of time. And time is money, after all.
3. Ask for Discounts
If you're happy with your insurance provider but curious if you can get a better rate, then you might want to inquire about discounts. Say you also have your renters' or homeowners' insurance with the same company. If so, ask about discounts for bundling policies. Additionally, the following are all valid reasons to ask for discounts:
- You have a safe driving record.
- You recently installed an alarm system on your vehicle.
- You're working from home and driving significantly fewer miles on a regular basis.
If you have a teen driver, you can ask about student discounts based on school performance or their distance away from home while attending college.
Plus, if you’ve been working hard to improve your credit score and have made progress, ask about getting a better rate. If you're turned down, don’t forget there's a slew of other car insurance companies that would be happy to earn your business.
Ready, Set, Go!
With the rising cost of everything from groceries to gas, many people are looking for as many ways as possible to save money. Searching for cheap car insurance is one of those expenses. To find the most inexpensive car insurance rates, make sure you understand how your credit score will impact the cost. Rely on expert opinions to help guide your decision. And don’t shy away from asking for discounts. Now you’re ready. Go save some money on your car insurance!