The Retirement Corporation of America

Saving On Car Insurance

IT PAYS TO compare rates for this kind of coverage more than it does for any other kind of insurance. Rates can vary by as much as 50% or more for the same coverage.

The first step is to find out what coverage is required in your state. Any auto insurance agent can tell you. Next, you need to decide on the coverage you really need and how much of a deductible you can afford to carry.

Call at least five car insurance companies in your area to get their rates. Most insurers will give you quotes over the phone. Don't assume you can get the best rate from the biggest company. Some smaller, less well-known companies offer the best deals. You can get a list of the lowest-cost insurers from your state insurance department. But be sure you know whom you're dealing with. You want prompt, reliable service when you have to file a claim. As we keep repeating, you also want to check an insurer's safety rating to make sure it's financially sound.

Ask about surcharges or the amount a company will raise your premiums when you have accidents. Insurers often hike your premium 10% for a first accident, 20% for the second and more for the next. In some states, insurers can hit you with a surcharge even if an accident wasn't your fault.

Keep your auto insurance information in your glove compartment. In many states you're required to carry proof of insurance anyway.

A Dozen Ways to Save on Car Insurance

1. Be a good driver.
2. Ask about a discount for safety equipment like airbags and anti-theft devices.
3. Take advantage of low-mileage discounts. Some insurers shave premiums for drivers who put less than a certain number of miles on their car every year.
4. Don't buy a "high profile" car that's expensive to repair or a prime target for car thieves.
5. Don't buy collision and/or comprehensive on an older car that you can afford to pay the cost of repairing yourself.
6. Consider car insurance costs when you decide where to live. Rates are lowest in rural areas, highest in big cities.
7. Ask about a discount if you have anti-lock brakes.
8. Check into other discounts. Some companies offer them if you insure more than one car with them, if you have no accidents in three years or if you're a good driver over age 50.
9. Raise your deductible. Increasing your deductible on collision coverage from $200 to $500 could save you 30% a year on your premiums.
10. Don't drive your car to work. Insurers typically charge higher rates for cars used for commuting.
11. If you live in a big city, keep your car in a suburb if you only use your car occasionally for pleasure.
12. Get new price quotes every few years.

Lowering the Cost of Insuring Young Drivers

Insuring a teen as an additional driver on your policy usually costs less than buying a separate policy.

As soon as your teenagers get a license, let your insurer know that they will be driving one or more of your cars. Your insurance company may lower your premiums if you specify that the teen will only drive the least valuable car in the family. You may also get a discount for good grades and/or if your teen signs an agreement not to drink and drive or limits driving to only daylight hours.

Even if you tell your insurer you aren't going to let your teen drive your car, your rates may go up anyway. You might be able to prevent that by signing an agreement called a "named driver exclusion" that specifies your teenager isn't covered by your policy.

Ask which driver's education classes qualify for a deduction; some insurers only approve certain programs.

Filing an Auto Insurance Claim

When you're at fault in an accident, you file a claim with your own insurance company. If the other driver is at fault, you file a claim with his or her company.

It's important to know what kind of information your insurer requires before you have an accident. Some things you should always do when an accident occurs:

•  Call the police.

•  Stay at the scene until they police have completed their report, making sure they have your version of what happened down correctly.

•  Exchange names, addresses, driver's licenses and insurance information with the other driver.

•  Report the accident to your insurance company right away even if the accident is minor.

Getting the Best Settlement From an Auto Insurer

Get at least two estimates of repair costs yourself. If those are less than the company is willing to give you, bring in a public adjuster. The public adjuster may be able to persuade the insurer to increase its offer.

Round up other evidence of what the car is worth that may disagree with its Blue Book value. Look in the classified ads to see what prices are being asked for other cars like yours in similar condition. Visit used-car lots or, if the car is relatively new, talk to the dealer you bought it from.

If the insurance company declares your car totaled, it will pay you the car's fair market value minus your deductible. Then the car goes to a salvage yard where it's auctioned off. If your car is a total loss but you want to have it repaired anyway, you can usually buy it back from the salvage yard. Your insurer still has to give you the car's fair market value, minus your deductible and what the insurer would have gotten for it from the salvage yard.