insurance

Slashing your car insurance premiums

PIP pays medical bills for you or your passengers after an accident. If you already have health insurance, you're duplicating the coverage provided by your own health insurance. That means the only real beneficiary here is your health insurance carrier, he says. Because whatever dollar amount of coverage you have "is money your health insurance company doesn't have to spend," Hungelmann says. So if you and all of the other people who ride in your car have health insurance, you can cut your no-fault medical coverage to the state-required minimum.

Two caveats: Some states require a certain amount of coverage. If your state is one of them, you'll have to carry at least that amount. Secondly, if you transport non-family members who may not have health insurance (carpooling co-workers, the kids' soccer team, non-driving neighbors, or nannies), this move might not be for you. In that case, coverage that would pay a passenger's medical bills after an accident could prevent injured passengers from filing more expensive lawsuits, Hoyt says.

Drop collision insurance. Clearly, this move isn't for everyone. But if you're driving an old clunker that's paid off, and either don't need to replace it or could come up with cash equal to its full value if something happened, dropping collision coverage from your policy could shave 10 percent to 15 percent from your premium, Flannagan says.

A word of advice: If you really can lay your hands on the money, set it aside now. Check Kelley Blue Book or Edmunds to get an idea of what your car, in its current condition, is really worth. Stash that amount in a place where you can easily access it but won't be tempted to spend it. That way, if anything happens, you're prepared.

The 'old reliables' 

Increase deductibles. If you're carrying deductibles of $100 or $250, you're probably paying for coverage you'll never use. Raise them to $500 or $1,000 (see which nets you better savings for your money), and put more cash in your pocket. Raising deductibles cold save you 10 percent to 15 percent of your premium, Flannagan says. But keep deductibles at an amount you can comfortably pay out-of-pocket.

Take advantage of all your discounts. Auto insurance companies give discounts for all kinds of things: low-mileage driving, anti-theft devices, teens who earn good grades, etc. And some of these breaks can save you from 5 percent to 15 percent off your premium, Flannagan says. Without them, "You might be paying a lot more than you have to be paying," she says.

Call your agent and talk about changes to your lifestyle -- like carpooling or cutting back on mileage -- to learn what discounts might apply to you.

Beware of gaps. Simple but vital, Savage says. If you switch auto insurance companies, always verify that the new policy is fully in force before you cancel the old policy.

For more information about insuring your car or to get a free rate quote, visit InsureMe.com.

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