4 Ways to Save on Car Insurance

This is it. You have your new car. There is nothing between you and the wide open road. Well, except for that expensive insurance bill every month. Here are 4 ways you can save on your insurance:

Look for Usage Based Insurance:

If you live in certain parts of Canada, you can take advantage of usage-based insurance (UBI) plans to save money. As a young driver or new Canadian, you will often pay higher premiums because you fall into a higher risk category.

How does it work? UBI monitors your driving habits in real time using car-installed technology. It sends the information back to the insurer where they assess things like braking, cornering, acceleration, and speed.

If you’re a safe driver, you can qualify for up to 25% discount on your premiums. Research your options to see if usage-based insurance is right for you.

Increase your Deductible:

What’s a deductible? It is what you’ll pay out before your insurance company picks up the bill. Most insurance plans are set up with a $500 deductible automatically. But you can move that around, depending on whether you want to save money on premiums or spare your emergency fund if something happens.

A quick and easy way to save a few bucks is to raise your deductible. If you can afford to pay more out-of-pocket when something happens, upping your deductible to $1000 will lower your monthly premium.

Don’t Get a Red BMW X5 Four Wheel Drive:

Insurance premiums are partially determined by the make, model, and type of vehicle you buy. Anything from the transmission type (standard, automatic, 4x4) to how often a certain make/model is stolen is all factored into the metrics.

You can save money by avoiding certain kinds of vehicles. You can check the Insurance Bureau of Canada to see how your own car measures up against the national average. Low average claim rates for your vehicle will save you money in the long run.

Myth buster moment: You will not pay more for red car. Insurance industry statistics do not support any correlation between auto accidents or thefts and the colour of your vehicle.

So get your Candy Apple Red Corvette without worrying about the colour affecting your premiums. I can’t help you with the Corvette part, that’s going to cost you.

Cancel your Collision Coverage:

Collision coverage makes up the majority of your premium and is designed to help you repair or replace your vehicle, even if the insurance company determines you’re at-fault. If you drive an older vehicle free from liens, cancelling your collision coverage can save you beaucoup bucks.

This doesn’t mean you won’t get money back if something happens but if you were in the wrong, you’ll have to pay out. This might sound like a bad idea but when you’re saving $1000 a year in premiums, replacing your $2000 vehicle on your own doesn’t sound so bad.

Now that you’ve pinched some pennies on your premiums, drive that wide open road worry-free.