How to Save on Auto Insurance

We may not be able to get away with not having auto insurance, but many of us pay too much for it. Just like anything else, it literally pays to shop around - but that's only one way to save money on auto insurance.

Do shop around for the best rates. It's the easiest way to save and with the internet, it's quick and simple. Use a site like Lowermybills.com or Insurance.com to get comparisons, then go for it. Often, the reason we don't change auto insurance companies is because we're stuck in a rut or we have some false sense of loyalty toward a company or agent. Realize that if you have too many accidents or don't get your bill paid in time, they'll dump you. Their only loyalty to you is your money and that's the only way you should look at them. If they cost you money, dump them.

Once you've found the right company, look into bundling your auto insurance, home insurance and whatever else you can. Most insurance companies offer discounts if you use them for all of your insurance needs. Ask about this if it isn't in their advertising. If they won't give you a discount, they may not be the company for you.

Every insurance company has discounts and pseudo discounts, so find out what they are. It may very well be worth the trouble to attend a defensive driver's class to get a lower auto insurance rate. Other possible discounts:

- Good driver, meaning no accidents or citations over a period of years

- Multiple policy where all vehicles in the family are insured by the same company

- Safe car discounts if you car is equipped with airbags and/or anti theft devices

- Good student discount if you maintain a high grade average

- Senior citizen or retired discount.

There are others; do your homework and find all of them your company offers.

Find alternative ways to finance a car so you won't have to have a lien against it. You don't need full coverage if your car isn't financed by a lending institution. You may be able to use a home equity loan or borrow against a life insurance policy. You may be able to take a personal loan or put something else up as collateral. Some of you may be able to sell your old vehicle or other things to come up with the money to buy a vehicle outright. Do it. It will save you insurance money as well as interest on a loan.

Before you buy a vehicle, check to see what the insurance rate will be. Some vehicles are a higher risk and will cost you more. Sporty or "muscle" cars may have higher insurance rates because the type of person who drives them tends to take more risks. Certain automobile colors are involved in more accidents because they're harder to see. An important factor in determining the rate for a particular vehicle deals with how often that make and model is stolen. Another one is how expensive it is to repair or replace a vehicle when it's been in an accident. The only way to know is to contact your insurance agent and ask about any vehicle you're contemplating buying.

Don't drive more than you have to. If you can keep your driving down to less than 6,000 miles a month, you may get a better rate.

If you have a choice, keep your car in a garage. This can also lower your auto insurance rate because there's less chance of it being stolen or damaged (deliberately or not) when parked.

Raise your deductible, but not so high that it will hurt to pay it if you should have an accident. The best tactic is to put aside or build up savings to equal the deductible you want. Most companies will cap the amount at $500 or $1000, so find out before you make your plan.

Ask you insurance agent to figure the minimum coverage your state allows. It's usually a reasonable figure - the state doesn't want you to be without good insurance. Your insurance agent wants to sell you as much as he can. Don't let him. '

To really see that bill go down, put every one of these ideas into practice that you can. It's worth a little work and a little time to do it because once you've done it, you're set for awhile. If you can save as little as $5 off a monthly payment, that's $60 a year. If it takes you two hours to cover all of this, you saved $30 an hour. That's not bad.