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Auto insurance is a must if you own a car. However, finding affordable insurance is proving to be more and more difficult every year. As the cost of living increases, everything else does too and a lot of Canadians struggle to stay within budget. If you can find a way to save a few hundred dollars every year why wouldn’t you? This means more money in your pocket and more money for other important things in your life. Here are 10 ways to save on your auto insurance premiums in Canada.
1. Shop around to compare car insurance quotes
One of the best ways to get the cheapest car insurance price is to shop around. By comparing auto insurance quotes with a few companies, you have a better chance of getting the cost that best suits your needs. However, be careful when comparing car insurance quotes. You want to make sure you are being quoted for the same coverage (i.e liability, collision, comprehensive etc). Do all quotes provide the same coverage? What about the claim process? By doing it this way you are doing an apple to apple comparison and you can therefore make a more informed decision.
2. Increase your deductible
The deductible is the amount you have to pay out of pocket should you need to make a claim. Your insurance provider pays the rest of the claim amount. For example, if your car is damaged in an accident and the amount to repair is $1,500, you are responsible to pay the deductible. In this case, if your insurance deductible is $500, you will have to pay the first $500 and your insurance provider will cover the rest. The higher your deductible the lower your car insurance premium. If you have money saved up and can come up with a higher deductible in the case of a claim, you are better off assuming the risk and lowering your insurance costs.
3. Ask about Multi-product discount
Some insurance providers offer a multi-product discount to clients who hold one or more product with their company. You may want to check with your current financial institution if they offer any type of discount for holding more products with them. For example, if you currently hold your home insurance and car insurance with 2 different companies, you may want to check with both of them if they offer a multi-product discount and see if it makes more sense for you to bundle your products.
4. Build a good driving record
We all know that accidents happen. However, it’s important to do your part and drive responsibly by respecting the rules: always wear your seatbelt, don’t drive while under the influence, avoid speeding, etc. Some insurers offer a discount to reward those who have a good driving record. The longer your driving record is clean the longer you’ll keep enjoying lower insurance premiums compared to someone who’s had an accident, for example.
5. Remove unnecessary coverage
More is not always the way to go with insurance coverage. Some options may not be applicable to you. It’s important to discuss with your insurance broker to get the best coverage for your needs. For example as your car ages, its value diminishes and it might make sense to adjust the coverage accordingly. If you have an older car, you might want to check if you really need collision and comprehensive coverage.
6. Don’t miss your payments
It goes without saying that it’s very important to make your car insurance payments on time. Missed payments can lead to your car insurance being cancelled for non-payment. The important thing to consider is that when your insurance is cancelled you are no longer covered by the insurer. Cancelled auto insurance can make it harder to not only get coverage but it can also cost more. There is often a fee to reinstate the policy and your premium will also increase. To avoid this, set up direct deposit payments to have your car insurance automatically paid from your account every month.
7. Remain claims free
Staying claims free is one of the best ways to avoid car insurance premium increases and keep benefiting from those savings. Before filing a claim, weigh in all the advantages and disadvantages of it. Does it make sense to file a claim and risk having your auto insurance premium increased?
8. Pay your premiums annually
You will save on your car insurance premium if you pay annually instead of monthly. Making your payments every month will cost you more as processing regular payments triggers additional administrative fees. Some insurers also provide a discount if you pay in full to tempt you into paying in advance.
9. Drive less for low mileage discount
If you only use your vehicle to drive short distances, you should be paying a lower amount than someone driving the same vehicle and a longer distance for their daily commute. Check with your insurer to see if there is a low mileage discount available that you can benefit from.
10. Get advice from an insurance expert
Working with an advisor is a great way to get the best advice about your car insurance. Talking to an expert has great advantages. The advisor will work with you to help you choose the best auto insurance for your needs and save you a lot of money in the process.
The Bottom Line
Sometimes the cheapest car insurance quote is not the best. It’s important to take into consideration all important options of a car insurance in order to ensure you are fully protected for your needs in case of an unfortunate circumstance.
