Buying a used car gives you the opportunity to save on more than just the cost of the car. In many cases you can also save more money on your car insurance. The following tips can help you realize these savings by making an informed car choice as well as understanding which coverages you will actually need to purchase for your new-to-you vehicle.
Tip #1: Check the car's rating
Before settling on a used car, check where it ranks for safety and theft resistance. Generally, the higher the car rates on these two items, the less it will cost to insure it. This means cars with extras, such as alarm systems, extra restraint devices, or GPS tracking, may cost significantly less to insure because they will qualify for insurance discounts. You also want to make sure the car isn't considered a high-theft or target car in your area. You can find this out by calling an insurance agent and seeing which used car makes and models they recommend for the lowest insurance rates.
Tip #2: Drop comprehensive coverage
Another benefit of going used is that it is easier to purchase the car outright with cash since it costs less than a new car. By not owing money on the car, you have the opportunity to drop comprehensive coverage if you desire. Comprehensive covers your car in the event that it is totaled or needs to be repaired after an accident that is either your fault, a hit and run, or by an uninsured motorist. It isn't legally required unless you owe money to a lender on the car, since they will want to recoup their investment.
Tip #3: Lower your coverage
If dropping comprehensive makes you nervous, you can at least lower your coverage amounts if you pay cash for a used vehicle. One tactic is to only cover the portion of damage or replacement that you couldn't pay for out of pocket if you were in an accident. This is because it isn't necessary to cover the full value if you don't owe money on the car. By dropping the extra coverage amount, you can realize significant savings, some of which can go in your car fund for your next purchase.
Tip #4: Don't double up on service
It can be tempting to spring for tow or rental car packages on a used car, since you aren't as confident in its reliability as you would be for a new car. Before adding these services to your insurance, make sure they aren't covered elsewhere. Some dealerships offer used car warranties that include these services for the warranty period, which means you won't need to have them on your car insurance right away.
For more tips on insuring your used car, contact an auto insurance company in your area.