Save Money on Your Car Insurance

Are you in need of reducing your monthly expenditures? Do you need to cut a little here and save a little there in order to make ends meet? You may be able to save on your monthly car insurance without shopping around or even changing insurance companies.

A few years ago, after the birth of our second child, my husband and I were trying to reduce our monthly expenditures. We decided that I should stay home full time and therefore lost my part time income. We examined areas that we thought we could save money and found several ways to cut costs. A few dollars here and there helped, but after some research we found the largest savings was with our auto insurance.

One of the things we discovered is that we could reduce our monthly car insurance payment for our 1995 vehicle that was paid off. We had a $500 deductible on the comprehensive coverage which covers non-collision events such as theft, fire, and weather damage.

And we also had a $500 deductible on the collision coverage which covers damage from car accidents. So, if the car was in an accident and needed repaired, it was most likely going to cost us $500 out-of-pocket and the same amount if it was a non-collision incident.

The car was only worth about $1200. We contacted our State Farm Insurance Agent and decided to drop both the comprehensive and collision coverage. Each state requires vehicle owners to have a minimum amount of liability coverage or financial security. If the vehicle is not fully paid off yet, comprehensive and collision coverage may be required. Check with your state for the specific auto insurance requirements.

We ended up saving $45.60 per month which amounted to a yearly savings of $547.20. That was over three years ago and now the car is worth about $800. We have saved almost $2000 by making those simple changes. The car is in excellent condition and it is wonderful not to have a car payment!

This is worth considering if you have an older car that is paid off. Do some research to see if this could save you money. You can check the value of your car at the Kelley Blue Book website. Talk with your insurance agent and find out if this can possibly save you money.

A savings of $45 a month was like getting a monthly raise of $45 for our family!

Source: State Farm Insurance Agent