Auto Insurance: It is something almost everybody needs, but nobody enjoys paying. Currently 49 states and Washington DC require you to carry some type of auto insurance (New Hampshire is the only state not currently requiring some type of coverage.) Most people are also looking for a way to pay the least possible and unfortunately it is not always easy as that “15 minute call” to save you money on insurance costs. It actually takes a bit of research and shopping to find the best possible prices for your situation.
The first thing you need to consider when shopping for Auto Insurance is the type of car you are going to purchase. It is true that there are some amazing deals out there for vehicles such as 0% financing and short term leasing. While these deals can turn into great deals on car payments, they can also turn into a nightmare when it comes to the insurance payment. Bigger type vehicles like SUVs and sports cars, such as a Mustang, can actually end up with an insurance payment that is higher then the vehicle payment.
Another big consideration to insurance cost is your current residence. Different cities throughout the US have different risk factors associated with them based on crime, population etc. If you possibly have more then one residence or a place you can use as a 2nd address for insurance reasons you may find that you are able to get a better price. Generally, you will find better insurance prices in the suburbs over a major city so if you have a means to take advantage of this definitely do so!
The most controversial factor that is currently used to determine insurance costs is your credit score. There has been a lot of arguing and fighting between the insurance companies and government lately over this. For some reason or another, credit has been used to determine more things that it was ever really meant to. Credit does not really give a reading into how good of a driver you are, however, the insurance companies seem to think that a low credit score means you are. They do not take into consideration the possibility that you had a major illness or a job loss (a big factor to low credit these days) and they will give you higher rates just based on this number. If you have any way to fix your bruised credit, definitely do it as this will save you money in the long run when it comes to your insurance rates.
Also, the one thing that should determine rates for insurance more then anything, is your driving record. Speeding tickets, accidents and DUIs will play a major role in determining your insurance costs. It also takes several years for driving infractions to fall off of your record. Keep this in mind next time you consider going 90 down the freeway, it could cost you more then just a ticket.
The bottom line to saving money in auto insurance is: drive safe, keep your credit clean and do your homework. It will save you a lot of headaches in the long run!