How to Negotiate Your Auto Insurance Rates When You’re Driving Less
One of COVID’s biggest impacts has been on our driving habits. A 50% reduction in driving has led to a noticeable reduction in auto emissions—good news, indeed—but it isn’t all rosy. All those empty highways and streets have emboldened drivers to a point of recklessness. Although accidents are way down in terms of numbers, the percentage of fatal crashes has skyrocketed—by hundreds of percentage points in some cities. Insurers have been forced to walk a fine line between being fair to customers whose cars now remain mostly parked and those who have used the crisis to treat their local Main St. like the Autobahn.
Read More: Cost To Own a Car for a Year in Every State
The good news is, you can probably save money if you’re driving less—and even if you’re not, in many cases. The pandemic has compelled virtually all insurance companies to work with their customers more closely and compassionately, to offer relief programs, and to remove penalties like late fees. Here’s how to lower your rates and take advantage of any programs your insurance provider is offering during anxious and uncertain times.
Tell Your Insurer If You’re Driving Less
According to PRWeb, a full 90% of Americans surveyed are using their cars only half as much as they were before the virus brought the office into the home and turned commuters into telecommuters. Insurance premiums are based on risk. The less you drive, the less risky you are to insure. If you’re among the legions of Americans whose premiums stayed the same even though their driving habits were scaled back, it’s likely you can lower your costs just by reporting the change.
Find Out: 35 Ways To Slash Your Car Costs
Don’t Cancel Your Coverage
If you’re not driving as much, or barely driving at all, you might be tempted to cancel your car insurance altogether. Don’t. Many states require you to insure your car whether you’re driving or not and you have to have insurance to get a car registered with the DMV. If your car is damaged or stolen while it sits unused, you’re on your own. The legal costs and repercussions of driving without insurance—even to the corner store or pharmacy—will make you wish you had just paid your monthly premiums. But that doesn’t mean you can’t pay less.
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Ask Your Insurer About COVID Relief Programs
Geico has a page with state-by-state information on the insurer’s many COVID relief offerings. Allstate gave $1 billion in relief to policyholders through its Shelter-in-Place Payback program. Liberty Mutual’s pandemic-assistance programs include payment flexibility, the Personal Auto Customer Relief Fund, and more. All major insurers, in fact, have created programs to help their customers get through the crisis. Visit your current insurer’s website and/or give them a call to ask about any COVID-related discounts or programs that might benefit you. If there aren’t any, just ask for a reduction in premiums—the current state of the industry, which comes next, might compel your insurer to lower your rates to keep your business.
Read More: 30 Major Companies Giving Back During COVID-19
See What Else Is Out There
Shopping around is always a good idea—experts recommend doing it once a year or so anyway—but the pandemic has created intense competition between insurance companies that drivers can leverage to their advantage. Even though people were driving much less, insurers continued collecting premiums that were calculated based on their policyholders’ pre-pandemic risk. In July, State Farm announced widespread price cuts—11% premium reductions on average—that many newly minted telecommuters believed they had coming. That move raised the bar and forced other insurers to follow suit with price reductions of their own. If your insurer won’t lower your rates, you might get a better deal elsewhere.
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Ask About Extended Grace Periods
In most cases, insurers will cancel a policy after a week or 10 days of nonpayment. 2020, however, isn’t like most cases. As early as April, most major insurers began extending grace periods for those struggling to pay their premiums. Those policies vary a lot. Some companies offered extended grace periods voluntarily. In other cases, states required them to do it. Other states required it early in the pandemic but have since removed those mandates. In almost all cases, anyone struggling to keep up with payments can expect more leeway than they would have gotten in 2019.
More Tips: 28 Tips for Negotiating With Car Dealers
Do the Normal Stuff
COVID forced a lot of changes in the insurance industry, but some things remain the same. You can save money by bundling your car insurance with your home, boat, and other policies. Multi-policy discounts can be good for savings up to 25%, according to Forbes—likewise for insuring multiple vehicles with the same company. You can save even more—as much as 40%—for safety equipment like daytime-running headlights and anti-lock brakes. Anti-theft equipment can lower your payments, as can affiliations with organizations like unions, schools, and the military. The most rewarding of all, however, are good-driver discounts, so drive safe even if you drive less.
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This article originally appeared on GOBankingRates.com: How to Negotiate Your Auto Insurance Rates When You’re Driving Less
