Saving on Wheels: How Reviewing My Auto Insurance Policy Slashed Costs by Nearly $20 per Month
Introduction
As a loyal insurance customer, I have always believed that sticking with the same car insurance provider is the best option. However, I recently discovered a simple way to significantly reduce my car insurance premiums, saving almost $20 per month. In this article, I will share my experience and provide tips on how you can review your auto insurance policy to potentially save money.
The Need to Save Money on Car Insurance
Car insurance premiums have been on the rise, making it essential for drivers to find ways to save money. According to Forbes, the Consumer Price Index indicates a 19.1% increase in premiums from August 2022 to August 2023. While shopping around for a new carrier is a common suggestion, I decided to explore options within my existing policy.
Taking a Closer Look at My Policy
To begin my quest for savings, I logged into my insurance account and devised a plan. Firstly, I added my fiancé as a second driver on my policy since we both use my car equally. Second, I carefully reviewed my policy details for any changes that could potentially lower my premiums. The process turned out to be surprisingly simple and only took a few minutes.
Uncovering Hidden Savings
During my policy review, I discovered an error in the “ownership status” of my car. Despite having paid off my car loan years ago, my policy still listed it as under lien. I promptly updated the ownership status to reflect that I own my car outright. This correction alone led to a significant reduction in my premiums.
Calculating the Savings
My auto insurance premium initially stood at $506 every six months with only myself as a covered driver. Adding my fiancé as a second driver increased the premium to $576 every six months. However, after updating my ownership status, my premium dropped back down to just $462 every six months, including the additional driver. The overall savings amounted to $114 every six months, which translates to nearly $20 per month.
Long-Term Savings
While saving almost $20 per month is noteworthy, the long-term impact is even more substantial. By making these adjustments to my policy, I am now saving $228 on my auto insurance premiums annually. This money can be put towards other financial goals or simply provide a little extra breathing room in my budget.
Tips for Reviewing Your Policy
When reviewing your own auto insurance policy, it’s important to strike a balance between finding savings and maintaining adequate coverage. Here are some key areas to consider:
1. Drivers on Your Policy
If you have additional drivers listed on your policy who no longer use your vehicle, removing them can lead to premium reductions. For example, if a teen driver on your policy has moved away for college and now has their own vehicle, it’s safe to remove them from your policy.
2. Ownership Status
Ensure that your insurer is aware of any changes in the ownership status of your vehicle. If you have paid off your car loan, make sure your policy reflects this update. Failing to do so could result in higher premiums.
3. Coverage Options
Evaluate the coverage options included in your policy and consider whether they align with your needs. For instance, if you have a separate roadside assistance membership, you may be able to remove this coverage from your policy. Additionally, if you have a higher deductible, you may be able to lower your premiums by increasing it.
4. Shop Around
If you’re not satisfied with your current auto insurance carrier or are open to exploring other options, consider shopping around for quotes. Comparing prices from different insurers can help you find the best deal and potentially save even more money on your premiums.
Conclusion
Reviewing my auto insurance policy proved to be a simple yet effective way to save nearly $20 per month on my premiums. By adding my fiancé as a second driver and correcting the ownership status of my car, I was able to achieve significant savings without sacrificing coverage. I encourage you to take the time to review your own policy and explore opportunities to lower your auto insurance premiums. Whether it’s removing unnecessary drivers or adjusting coverage options, a few simple changes can result in substantial savings.