Saving On Auto Insurance: A Few Useful Tips

Getting the right insurance for you and your car isn't easy, especially in those parts of Canada where the customer is not bound by a government-owned (or, at least, a government-run) insurance company.

We're always searching for ways to save money on car insurance. But is cheaper ALWAYS better? Not always. Still, there are ways to get ahead without breaking the bank.First and foremost: what kind of insurance forms the basic minimal requirement where you live? Get at least three quotes from three different insurers. Check whether they offer any discounts, say, for a clean driving record.

Look at what kind of other services they offer. Ask around to see if they have a good reputation.

Another angle: on most policies there's a deductible. That's the amount you're paying before your insurance company writes its cheque.

Have their appraiser have a look at your vehicle so you know in advance how much to expect from your insurer, pay your deductible, and file your claim for the rest. Now comes the somewhat involved question: should you increase your deductible while signing up? The rule of thumb says that if you, for example double your deductible from $250 to $500, you will see your premium go down anywhere between 15 and 30 per cent.

Doubling it again, to $1,000, will see your premium go down by about 40 per cent. Nice, provided you've managed to avoid any accidents and you don't file any claims against the policy. That would make it a net saving to you.

But what if you're accident-prone? And it doesn't have to be that you routinely forget to yield to oncoming traffic or have difficulties merging into highway traffic, or whatever else. You just may be that unlucky kind of guy who goes into the grocery store and comes back to a dented car.

So, this will be your own decision. A good insurance company representative will calculate the possibilities for you, depending on your previous record, take into account where you live, and on how much you drive a month.

Don't let anybody talk you into anything without doing your own research. Now, let's say your car is a complete write-off after an accident. Insurance companies have their own criteria to assess how much they owe you. There's a publication out called NADA Guides. It estimates car prices.

If you see your good old reliable duster won't fetch more than $1,000, consider dropping collision and comprehensive coverage wherever and whenever possible. Your premiums will go down accordingly.

Each vehicle make has its own "loss history," to use the insurance lingo. It means that insurance companies have a database that tells them about the average claims and their frequency by type (and year). A U.S. website, www.insure.com, maintains a car insurance comparison tool that lets you calculate average premiums on more than 3,000 new car models. Check it out.

Ask whether the company you're talking to is willing to give you a discount because you drive fewer than is the usual number of kilometres. And while asking, if your car has any additional safety equipment installed, make sure you mention it to the insurance agency representative. It would be insane if you didn't ask for a discount based on that.


You can also ask for discounts if you happen use the same insurance company for other cars, or if you did the same with your house.

If you're lucky, group insurance may be a part of your benefits. And, make sure your credit rating is in order: insurance companies have this thing against bad credit. And if you have teen-aged offspring, you may consider using applications that check upon your their driving.

Check with your insurers whether they offer a program like this. It can be a simple video camera, with microphone included, that is triggered by excessive speeding or fast braking. It can be even a GPS application that sends you similar signals.

Other than that, happy driving.