How to Save Money on Auto Insurance

When you receive your insurance policy, it’s a good idea to check that the information used to determine your premium is correct. An auto insurer is required by law to provide specific rating information pages with your policy that explain how your policy is rated, what the classification codes mean, as well as how its surcharge system works. You should also check the information in your policy against these pages, and verify that:

• your mailing and/or place of garaging address is correct;
• each vehicle is properly classified;
• all discounts to which you are entitled have been applied;
• the make and model of your vehicle(s) are correct;
• the age/birthdate(s) of the driver(s) are correct; and
• the dates of any chargeable accident(s) and conviction(s) identified are correct.

As an insurance shopper, you should check with your insurance company or agent or broker about possible discounts that may be applicable to you, such as those for senior citizens, car pools, low annual mileage and the "good student discount" offered to youthful operators meeting certain academic requirements. You can also save money with a "multi-car discount" by insuring all your cars with the same insurance company. Since rates are generally highest for youthful drivers, young drivers should inquire about a "driver training" discount offered by many insurers for those who have taken driver’s education classes.

Discounts are generally available in the following situations:

• You may decrease your premium by taking a Department of Motor Vehicles-approved accident prevention course. Auto insurers must apply a discount to the liability, collision and No-Fault coverages of your auto insurance policy for three years, if the principal operator of a vehicle has completed a qualified accident prevention course. In addition, taking this course entitles you to up to a four-point reduction of accumulated points from your driver’s license. Your auto insurer is required to provide you with a listing of all sponsors of these courses with your policy or billing statement. You may contact your local Department of Motor Vehicles office for more details about how this benefits your driving record.

• If your car is equipped with automatic seat belts or air bags, you qualify for a discount on your premiums for No-Fault and medical payments coverages. All private passenger automobiles that are model year 1990 or later are required by federal law to be equipped with at least one of these devices.

• If your car is equipped with factory installed anti-lock braking system (ABS), you are entitled to a discount on the premiums for your liability, collision, No-Fault and medical payments coverages.

• Several anti-theft devices qualify for a reduction on the comprehensive portion of the auto insurance premium. Eligible devices are generally alarm systems or permanently installed devices that prevent a car from being started. In addition, discounts are available for cars equipped with certain electronic-tracking devices, or in which the window glass (windshield, door glass, rear window, and sun/moon roof or T-Top) has been etched with the Vehicle Identification Number (VIN) or other identifying symbol qualifying under the law.

• If your car is equipped with factory installed daytime running lamps (DRL), you are entitled to a discount on the premium for your liability, collision, No-Fault and medical payments coverages.

• Some insurers also give a discount for vehicles participating in a Combat Auto Theft (CAT) Program, in which vehicles displaying an official decal may be stopped, without other cause, by law enforcement officers if operated between 1 a.m. and 5 a.m., the prime vehicle theft period. This program is available in many areas of New York State, and requires the participation of the local police department. You may contact your local police precinct and your insurer to see if you are eligible for this program.

• Many insurers give a "Careful Driver" or comparable discount for drivers who have been without a major incident (e.g., accident or conviction) for a certain period of time.

• Many insurers offer a "Multi-Policy" or "Account" discount, which reduces your premiums on both auto and homeowners coverages when purchased from the same insurer.

• Some insurers specifically give discounts for senior citizens or retirees, based on the fact that they are generally on the road less frequently than younger drivers.

• You may reduce your auto insurance costs by raising the deductibles on physical damage (collision and comprehensive) coverages or by eliminating these coverages on older vehicles. Review the amount of the deductibles you now carry on these coverages to determine whether it makes sense for you to absorb a larger portion of your loss in the event of an accident, in return for a lower premium charge. Your insurer is required to furnish you with information about how much you may save by adjusting deductibles.

Since the actual amount of these discounts may vary among insurers, ask your insurance company, agent or broker about any discounts that may apply to you. Most likely, you already get information about these discounts with your policy or billing statements. In addition, as stated previously, the dollar amount savings of any discounts required by law must be stated on the declarations page, or attachment thereto, of your policy. A summary of discounts commonly used by the insurers whose automobile rates appear in this Guide is shown in Appendix II.

Consumers can also save money by informing the insurer of any new conditions that may affect the nature of the insurance exposure, such as when a young driver in your family leaves home, or if a young driver goes to college more than 100 miles away and does not take the car. Most importantly, maintaining a good driving record will save you more by allowing you to qualify for the best rate.

As this Guide illustrates, your final auto insurance premium is based on many separate factors that are unique to each driver and may vary among insurance companies. At the end of this Guide you will find an "Automobile Insurance Checklist" which you can detach and keep handy when you shop for coverage. You'll be able to list the coverage limits and deductibles that you want in your policy and make sure that you've received all the discounts you’re entitled to.

Reprinted from New York State's Consumer Guide to Automobile Insurance.