Are you paying an insane amount for your car insurance? Asking yourself, “Why is my car insurance so high?” and “what can I do to drop my insurance premium? Well, it turns out there may be a few factors driving your rate up to a ridiculous degree.
Curious what costs go into your car insurance, and what you can do to address the issue? In this article, we’re sharing car insurance company secrets on how they set your premiums, and how you can fight for a fairer price.
Why Is My Car Insurance So High?
Understanding the basics of car insurance is difficult. But it can be even harder to identify and understand the lesser-known policies car insurance companies don’t really advertise.
Here are 5 car insurance company secrets you should know in order to approach your plan in the smartest and most cost-efficient way possible.
Your Specific Car Matters
Did you know the specific car you drive can impact how much you pay for car insurance? Factors like the total value of the car, the make and model, and even its safety rating affect the overall cost of insurance. You may even be forced to pay more insurance based solely on how many miles you drive a day and where you park your car.
You May Have Signed up for Expensive Coverage
Car insurance policies will often offer you optional coverages that seem mandatory. This can lead you to pay for things you don’t even know you have. So, do your best to avoid policies with high liability limits and plans with low deductibles as they tend to cost you a lot more in the long run.
Your Credit Score Impacts the Cost
There is some correlation between credit score and how much a person typically pays in car insurance. That’s because insurance companies view people with poorer credit scores as a greater risk and charge them more to cover any potential future claims that come up. If you don’t live in California, Massachusetts, or Hawaii then your state’s car insurance companies will use credit score as a factor in their pricing.
Driving Record Plays a Role
Your existing driving record shapes your insurance rate. So, if you had any recent traffic violations or accidents then you should expect to get a much higher insurance rate. This information will follow you wherever you go, so any car insurance company you attempt to switch to will be able to access it.
You’re Paying in installments
Many people pay for their insurance in installments because that’s what they’re accustomed to. But that can often end up costing a lot more than just paying it all in full. Most insurance companies charge you an administrative fee for breaking up your payments into installments, and these can quickly add up.
So, if you’re able to, consider paying your insurance premium in full. And be sure to check if there are other factors that you may be getting charged for like pay-by-phone or bill pay.
Ready to Pay Less for Your Car Insurance?
Car insurance is already expensive. There’s no need to pay even more because of policies car insurance companies fail to mention. Now that you know the answer to “why is my car insurance so high?”, you can avoid these common traps and fight for a. fairer insurance rate.
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