In a nutshell, insurance policies involve the transfer of risk. The insurer agrees to compensate you for a loss rather than you having to pay for that loss yourself. Usually the insurer assesses whether to accept the risk (and if so, on what terms) through information they get from you. You decide whether the terms the insurer offers meet your needs.
Buy online and save
Increasingly, insurers are offering online savings to shoppers who obtain a quote and subsequently purchase their insurance policy online. Some insurers will offer as much as $50 cash off, while others offer a flat 10% discount. Regardless of how simple or complicated the insurance research process is for you, obtaining online quotes and purchasing online is the fastest way to compare insurers and save money.
Be warned, though. Just because an insurer offers an online discount doesn’t mean they’re the cheapest for you. Do your homework with our car insurance star ratings.
Restrict young drivers
Since drivers under 25 are perceived to be at greater risk of making a claim, many insurers offer discounted premiums if you declare that no one under the age of 25 will be driving your vehicle. This can be a great way to reduce your premium. Take advantage, if you can.
Choose your extras carefully
Being frugal with extras can save you a bundle on your premiums. One excess-free windscreen repair, hire car after an accident, and no claim discount protection are all great options, but they often come at a price. Choose only the options you think you will need. Reading the Product Disclosure Statement carefully can mean hefty savings. Pay more excess, pay less premium.
Save on your premium each year by electing to have a higher excess on your insurance policy. In the event of an accident, you’ll need to pay more if you opt to make a claim, but if you’re a good driver the idea is that over time the reduced premiums will save you more money than the increased excess you will pay in the event of an accident. Be careful though, saving $100 or so may look appealing but if you make a claim you could be in for a nasty surprise.
Being loyal can save you money
Already have home and contents insurance? By sticking with the same insurer for your car, bike or boat, you can often benefit from loyalty discounts.
Take advantage of discounts
If you previously had your name on your parents’ insurance policy, you could be eligible for a huge discount when the time comes to take out a policy of your own. Some insurers count every year on your parents’ policy towards the number of years considered when they calculate your no claim bonus. Be sure to mention this when you get a quote.
Fit an alarm, immobilizer or both
All improvements to security should help to lower your car insurance costs. Some insurers may even insist on sophisticated tracking devices before they will insure expensive cars. Keep your car parked in a locked garage overnight if you can. A lot of vehicle thefts occur at night so if your car is safely locked away your insurance costs will be less and you will have peace of mind. If you don't have a garage, parking in a driveway is generally considered a lower risk than parking on the road. It's less likely that vandalism, theft or accidental damage will occur when you're off the highway.
Pay by the month
Many insurers now give you the option to pay by the month. This could cost you extra but there are some insurers who offer pay by the month at no additional cost. Compare insurers and pick one that suits your needs. Paying by the month can help you budget, and you won't receive a huge bill each year!
Claims Service
Everyone is an expert after they've had to make a claim on their insurance. How well an insurer handles claims can often outweigh any premium discounts they may offer. Talk to people who've made a claim and see what they thought of the service they were given by their insurer. Price is not the only important factor when choosing an insurer.
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