Reducing your car insurance rates

In a time when we’re all looking to cut expenses, here’s an interesting story about how some people are cutting their car insurance rates.

When Zshavina Meacher of Cleveland traded in her car for a new 2011 Chevy Malibu last summer, her insurance premium jumped to $510 every six months. Her insurer, Progressive Corp., asked her whether she wanted to cut her rate.

If Meacher agreed to install a device in her car that monitors how safely she drives and the results were good, her rates would go down. If the results weren’t so good, her rates would stay the same. She agreed.

During the first few weeks, the device told Meacher that she slammed on her brakes a lot. She stopped the hard braking.

In February, the 23-year-old’s insurance bill dropped by $120 per six months, or 24 percent.
Meacher is happy her rates went down. And Progressive is happy the risk of Meacher getting into an accident went down. Fewer claims will help keep Mayfield-based Progressive profitable.

If you haven’t heard of telematics — a device that monitors your driving — then get ready. While Progressive started dabbling in telematics in the 1990s, it started pushing it in 2010 with its “Snapshot” program, and other insurers have stepped up interest in the last year.

Telematics is changing car insurance, and who knows what else it might change. Of course this raises privacy issues, but for people who need to watch every penny, it can really be a helpful option to lower your car insurance costs.


5 Best Ways to Lower Your Car Insurance Premium

Sick of paying high premiums for your car insurance? The average U.S. driver pays around $850 a year for their car insurance, but it doesn’t have to stay that high. While not every tactic will work for every driver, it’s possible to reduce the amount you are currently paying for car insurance premiums by applying one of the following tips.

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1. Pay a Higher Deductible
The more you are willing to pay for your deductible – the amount you cover in an accident before the insurance kicks in – the less you’ll pay up front. For safe drivers, this can be a good way to go, but it does mean that if something goes wrong, you’ll be liable for more of the damages, so consider carefully before making the decision. Save up to 40% just by switching from a deductible of $250 to $1,000.

2. Reduce Coverage
Do you really need the coverage you are currently paying for? Being selective can drastically change the amount you pay up front for insurance, and in many cases, drivers can eliminate certain parts of their coverage without any problem. For example, if you live in the desert, you probably don’t need flood coverage.

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3. Check for Discounts
Depending on the insurance company, you may be eligible for a discount, depending on how many years you have been driving, organizations you belong to, if you are a senior citizen, or even if you are female (women drivers tend to be safer). If you buy online auto insurance, you can sometimes receive a discount. Discounts may also be provided for those who have certain safety devices installed in their vehicles, so it is worth asking about. You might be surprised at what can be used to reduce your premiums.

4. Pick the Right Car
The vehicle you drive will also have a big effect on the amount of insurance you pay, so when purchasing a car, consider picking one that will give you lower rates. Check to find the safest vehicles, which are usually cheaper to insure.

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5. Improve Your Credit Score

Like many other things in life, your credit score has an impact on how your insurance company calculates your insurance. A poor score can indicate that you will have more claims than someone with a higher score, so taking steps to improve your credit score can actually change how much you end up paying for car insurance premiums. If your score changes drastically for the better, be sure to let your insurance company know before renewing your policy.

When it comes to car insurance, you don’t have to sit back and accept high premiums. Be active, and you can actually lower those costs and make car insurance far more affordable. Even if you can’t put all of the above tips to use, you should be able to use at least 1 or 2 of them to make a difference.



8 Sure Fire Ways to Raise Your Car Insurance

Road Trip.

You’re on a road trip with a 19-year-old guy named Joe who’s decided to forgo college to try acting in Los Angeles. He’s had a few accidents and speeding tickets in his old hand-me-down car, and he is not a reliable bill payer. You’re a well-educated 50-year-old married woman who never has accidents, pays her bills on time, and lives in the country with a secure job and no children. 
Joe’s car insurance premium is higher than yours, and it’s easy to see why. But there are other factors that determine how insurance rates are decided. Here are eight things you can do to raise your car insurance rate.

1. Be a Man
It’s not the fault of insurance companies that men are involved in accidents far more often than women are. So until those statistics change, women should just enjoy the little perk of paying lower premiums than men.

2. Be Under 25
Young people, due to their inexperience behind the wheel, are far more likely to be involved in accidents. Consequently, teenagers and young adults often pay higher insurance rates. Maybe middle age isn’t such a bad thing. 

3. Buy a Sports Car or an SUV
That dream purchase you’ve been saving up for is sure to increase your rate. But don’t buy a bottom-of-the-line clunker, either. Chances are, if your grandma would buy it, it will keep your rates low. 

4. Move to a Metropolis
More people mean more cars. More cars mean more accidents. Since living in a big city is considered an accident risk by insurance companies, this means you’ll be spending more money if you like the big city.

5. Speed
Penalties vary, but if you like to put the pedal to the metal, you might as well reach for your wallet at the same time. Speeding tickets raise your auto insurance because drivers who speed often, get tickets and have accidents, which makes them a liability on the road.

6. Drop Out of High School
It turns out that getting an education will do more than help you get a better job – it will help you get better car insurance rates. Maybe you can use this logic to convince your parents to help pay for college – and your car.

7. Don’t Pay Your Bills
If you are demonstrably unreliable, you can’t expect insurance companies to count on you. Your rates will be higher until you can prove you can pay your bills on time.

8. Get in Accidents
Yes, accidents do happen, and if you are unlucky enough to be involved in one, you will see an increase in your insurance rate. It may not appear in this year’s premium, but you will most likely see it on next year’s bill. 

You can’t control some factors – like your gender or age – but other factors, such as slowing down, paying your bills, and making sensible choices when buying a car, will help you keep your insurance rates as low as possible.


The Medicare debate

House Budget Committee chairman Paul Ryan, R-WI, arrives for a hearing to mark up his 2012 budget proposal called “The Path to Prosperity” on Capitol Hill in Washington on April 6, 2011. UPI/Roger L. Wollenberg

With the radical new budget proposed by Paul Ryan and passed by the House Republicans, we have a full-fledged debate about the future of retirement in America. Ryan’s budget removes the guaranteed Medicare entitlement and replaces it with vouchers (or premium supports, depending on who you listen to). According to the Congressional Budget Office, the subsidy from the government will not be enough for most seniors to purchase medical insurance, assuming private insurers even want to cover them.

This is a radical departure from the social safety net. The Republicans argue that this will not apply to current seniors, just those under the age of 55. But that cold comfort for everyone else, including seniors who care about the future of their children, relatives and friends.

It’s doubtful that anything like this will pass with the current President and Senate, but everyone needs to pay attention. Who knows, the next election may affect your retirement years.


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