Insurers have made a lot of adjustments since the start of the pandemic. Here's what you need to know to save.
The COVID-19 pandemic led to a dramatic reduction in transportation of all kinds. Between lockdowns, quarantines and social distancing protocols, far fewer people were flying and driving, and despite rising numbers of vaccinated people, we have yet to achieve pre-pandemic levels of travel.
Car insurance companies responded to the pandemic with price reductions and rebates, but now more people are back on the road and reevaluating their auto insurance coverage. Even in the absence of a pandemic, shopping around for car insurance is good for your wallet -- auto insurance costs can be quite variable, and you can negotiate when it comes to your coverage.
Further, there are a lot of factors to consider. Maybe you just purchased a new car and want to make sure your coverage extends to damage from a collision. Maybe you took a defensive driving course and want to see if your premium drops. Perhaps you're working from home permanently and need less coverage. Or, maybe you were in an at-fault accident and your premiums are no longer manageable with your current carrier. Any and all of these are good reason to contact your auto insurance company and ask about your options -- as well as start calling other companies to look into what savings they may be able to offer.
One important thing to note, even if you're now working remotely on a permanent basis: Do not cancel or suspend your insurance if you're still driving -- even if it's only occasionally. Driving without insurance is illegal. And trying to reinstate a policy after canceling one can result in even higher premiums.
So, are you ready to save? Here are five good steps to take toward saving money on your auto insurance.
Even though life in the US is slowly returning to normal, it is still a great time to shop around. It's likely that your insurer has its own discounts and promotions to consider, but that's shouldn't stop you from shopping around -- other insurance carriers may be offering even bigger discounts, more relief options or lower premiums. Check out CNET's roundup of the 10 best car insurance companies to get a better idea of your options.
The insurance companies understand that the pandemic changed the way that many people drive. They also understand that many of their customers are struggling financially and may be willing to provide some help.
"Insurance carriers recognize that this is a difficult time, and in response, many have offered a credit, refund, premium adjustment or premium reduction, for a current and specified time period," said P.J. Miller, independent insurance agent with Wallace & Turner Insurance.
Here's how you can reach some of the top insurance companies to ask about potential discounts and relief.
If you buy car insurance from one of these companies, it's worth double-checking to make sure you're taking advantage of all of their available programs.
Many of the factors that affect the price of auto insurance are relatively fixed, including your driving record, where you live and your credit score (in applicable states). But a few are variable -- such as how many miles you drive a day. If you're driving less frequently than before that may present an opportunity to reduce your premium.
From your insurance company's perspective, the more you drive, the more opportunities you have to get into an accident. If you've shifted from commuting daily to working from home during the pandemic, your lower weekly mileage may translate to a lower premium.
Note: Whenever you make changes to your stated mileage (or other components of your insurance profile), it's important to update your policy. Inaccurate or outdated details on a policy could have a negative impact on claims.
Changing your deductible can lower your premium, but it can also end up costing you more in the long run if you have an automotive mishap. The average policy carries a $500 deductible -- which means that you'll have to pay $500 out of pocket before insurance kicks in. If you increase your deductible to $1,000, you may reduce your monthly premium. Especially if you're not driving much right now, it might be worth it.
Many insurers offer more than just one type of coverage, and may give discounts to customers who buy multiple policies. If you bundle together policies for a home or boat, you may get a lower rate for each. Allstate, Liberty Mutual, and GEICO each offer premium discounts for bundling -- depending on which policies and coverages you buy together.