Written by Q: I have a car that’s worth about $3,000 and my car insurance bill is $300 per month. Should I find another insurance company, or is there a way to get my rate lower because I don’t want to pay over $3,000 a year for a car that’s worth less than that.
AIS Answer: You’re definitely not alone. Often when you’re a younger driver (even in the late 20′s) and you finance a newer vehicle like a BMW and see your car insurance bill, it’s about the same price as your lease! Same goes for people that own an inexpensive car but get a very expensive insurance premium.
First of all, you’ll need to call your insurance company to evaluate your coverage and go over options before making a change to your policy.
If you’re carrying anything more than Liability (i.e. Comprehensive and Collision), you can raise your deductible up from $250 to $500 or even $1,000(depending on if your vehicle is financed as there are restrictions to the amount you can raise your deductible), and this could save you a few hundred over the course of a year.
If you do have comprehensive and collision on your policy, and you don’t have a family, house you own, or other assets to protect it may be an option to drop comprehensive and collision altogether. Although carrying Liability only or the minimum amount of car insurance allowed by your state will definitely save you money, it comes at a cost. Coverage is the most important thing auto insurance provides, so when you talk to your insurance company make sure you understand all of your options before making any decisions, as dropping coverage or not having enough can leave you wide-open to lawsuits.
If you find that you can’t make any changes to your automobile insurance policy because it’s already at the lowest amount of coverage and highest deductible allowed, then you’re going to have shop around for car insurance from other insurance companies if you want to try and save with a similar policy somewhere else.
It’s always a good idea to compare auto insurance whenever you’re about to start a new policy, so if you’re coming up on a renewal, or just dont like your rates – then get as many quotes as you can from different companies and see if you can save.
ha…welcome to the club. I used to own an 80′s toyota and I had paid $2,800 for it, my insurance was around $150/mo! Within 2 years of ownership I could have easily purchased a new one.
I also leased a vehicle onetime and my lease was $350/mo, my insurance was $275/mo!
I don’t think there’s any way around this when you’re younger. If you finance you’re stuck paying for full coverage and a low deductible, which of course makes your premium in the $1,000 – $2,000/yr range.
If you buy a vehicle under $5,000 and plan to keep it for longer than years, but only carry the lowest amount of insurance required by law – you’re still going to pay around $1,200/yr. if you’re a young male.
It’s a joke honestly. You can’t afford to buy an expensive car, and you can’t rationalize insuring it with more than liability because the car insurance is too high!
I pay $6,000 for a car insurance on 5 cars…you can do the math
$6k? Damn. I remember when I didn’t even own a $6k car. My insurance has always been high.
I think I pay a high amount for my car, but I could only imagine how bad it would be to pay the full amount of your vehicle in ca rinsurance each year.
insurance prices are not going down, and car values almost always do. It’s pretty easy to see that an older used vehicle is going to cost more to insure than it’s worth.
I would carry liability only on a cheaper vehicle. You’re going to keep that car for like 5 years probably and spend 4 to 5 times what it’s worth on car insurance.
with the way inflation is going and depreciation in vehicles, it’s only a matter of time before auto insurance premiums are going to catch up witha cars value. Look at older VW’s or Honda’s. They’re worth like $7k max, then you’ve got full coverage at around $1,800/yr. Within 5 years you’ve already spent $2k more than your car was worth.
get used to paying high car insurance with or without a bad driving record. That’s the way insurance companies work, they never want you to pay less money.