Car insurance prices may seem somewhat alarming at first sight if you are a young adult. However, there are ways to limit the cost of hedging. We will explain six of the best methods below.
Reduce your coverage limits
Reducing your car insurance coverage leaves your car and your finances less protected, but it can help you get the cheapest car insurance on the market. You will likely need to carry bodily injury liability insurance and property damage liability insurance. In some states, the minimum coverage may be more extensive than this.
However, you will pay higher rates if you add optional types of insurance such as Comprehensive Coverage or Collision Coverage. In some states, uninsured motorist coverage is also not required.
Drivers with additional coverages such as roadside assistance, rental car reimbursement and accident forgiveness could reduce their insurance costs by waiving them.
Increase your auto insurance deductible
It’s much easier to find cheap auto insurance for young adults if you choose a higher deductible on your policy. This means you will pay more out of pocket if you file a claim. It’s up to you whether you’d rather pay more up front for coverage or risk having to pay extra later.
Bundle your insurance policies
If you pay for home or renter’s insurance, bundling your existing car policy with these coverages could get you lower rates for each policy. Since you’ll need protection for both your vehicle and where you live, it makes sense to reduce the cost of car insurance by using the same provider.
Increase your credit score
In most states, auto insurance providers can use policyholder credit scores to determine their rates. You will pay a lot more for your own policy if you have bad credit compared to someone with a better score.
Improving your credit score takes time, but it is doable. You’ll save on more than just car insurance if you have good credit, because lenders will generally offer you lower interest rates on loans and lines of credit.
Compare auto insurance quotes
Finding cheap auto insurance for young adults is much easier if you get free quotes from multiple providers. Asking for car insurance quotes will help you see if you are getting fair rates.
Sign up for a telematics insurance program
With telematics insurance, also known as usage-based insurance, your car insurance provider tracks your driving habits through a mobile app or similar tool. If you drive safely or don’t get a lot of miles on your car, you could get a discount on your premium. But keep in mind that activities such as speeding may result in higher rates with some usage-based insurance programs.