Keep your credit score as high as possible. An increasing number of auto insurers are using financial credit scores as one of the factors in assessing risk and setting rates. For these companies, the higher your credit score, the lower your auto insurance premiums. If your credit has been tarnished recently, you could end up paying more when your next premium comes due, so do everything you can to keep your score as high as possible and to get it back up as quickly as you can. If you know your credit has improved, don't hesitate to ask your insurer to rate you again, since the company may not do it when your premium comes due.
Get adequate uninsured/underinsured motorist coverage. The number of uninsured and underinsured drivers is on the rise, primarily due to the increase in unemployment. Unless you have uninsured/underinsured motorist coverage on your policy, you will be stuck with the repair bill on your car and potentially your medical expenses, depending on your health insurance coverage. Spend the extra money to get as much of this coverage as possible, since even a minor fender bender in a parking lot could result in repairs that cost thousands of dollars.
Tread carefully if you drop collision coverage. Americans are keeping their cars longer -- another result of hard times. While an older car is generally cheaper to insure, some people consider dropping collision coverage altogether to save even more money. However, remember that a lack of collision coverage means you'll need to foot the entire repair bill for your car if you are at fault. Spending the extra money on collision coverage may be a better choice if it will be challenging to get the funds to repair or replace your car after a collision.
Ask the adviserIf you have a car question, e-mail it to us at Driving for Dollars. Read more Driving for Dollars columns and Bankrate auto stories.
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