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Insider Secrets to Auto Insurance Savings

How to better manage your auto insurance costs

The key to lowering your premium lies in how you drive, what you drive, and the coverage you choose.

How you drive

You've always been a careful driver; you have no demerit points – great! Generally, the better your driving record, the lower your insurance premiums. Your driving record is based on:

The number of years you've been licensed to drive
Any convictions due to driving infractions
The number of accidents you've had
Speeding tickets and moving violations.

If your vehicle is over 10 years old, consider dropping the collision coverage as you may no longer have a financial interest in this vehicle.

Accidents can affect your premium. If you have an at-fault accident on your driving record, it stays with you for 6 to 10 years. Since your insurance premiums may be affected, you could be paying for that accident for years until it is off your driving record and your premium decreases.

What you drive

Certain vehicles are less expensive to insure than others.

Check your car's rating. Use the Insurance Bureau of Canada's (IBC) How Cars Measure Up to get an idea of which makes/models could cost less to insure.
Know what thieves want. Check the IBC's Top 10 Most Stolen Cars in Canada. Car insurance premiums are generally higher in and around large urban areas due to a higher number of accidents and theft or vandalism claims. So, where you live is also a factor.
Help thwart thieves. In some cases, installing an approved aftermarket immobilizer or purchasing a vehicle with one already installed may help lower your premiums. And see the section of this article on safety tips.

Cost to replace. Insurers also look at the cost of repairing or replacing your ride should it be stolen or involved in an accident. One of the ratings they may look for is the Canadian Loss Experience Rating (CLEAR) which uses insurance claims data to place every make and model on a claims-risk grid.

The higher the risk, the more you'll pay. Generally, newer and luxury models will cost more to insure for this very reason.

The coverage you choose

Carry as much coverage as you need. If you have an old car, for example, consider canceling or reducing your collision and/or comprehensive coverage.

Consider who drives your car. If possible, remove any high-risk drivers from your policy. Insurers also take into account the number of drivers who use your vehicle and their driving records as well.

Increase your deductible. You may pay less for insurance if you're willing to pay a higher deductible should you file a claim.

Keep your coverage up-to-date. If you've installed a safety or theft-reducing device, you may be eligible for a lower rate.

Look for discounts

Review your automobile policy annually and hunt for a good deal. And don't forget to ask about discounts.
If you're a member of a professional group or alumni association, you may qualify for special rates with a particular insurer.
Your employer may have negotiated a group discount with an insurance provider.
You may be eligible for special rates if you have both home and automobile insurance policies with a single provider.

And be sure to consider insurance when you're buying a new car! Before you decide what to buy, get an idea of insurance costs for various makes and models.

Tips for beginners and young drivers

Drivers with less than 2 years' experience can reduce their premiums by taking an advanced driver's education course and obtaining a certificate. Not only do you learn the skills to become a better and safer driver, you save money!

For newly licensed drivers, start with an older vehicle until you have gained enough experience and your insurance premiums have decreased.

You'll receive additional discounts when you complete your graduated licensing program.

Straightforward safety tips

Always close your windows, lock your doors and keep your keys and driver's licence with you.
Never leave anything of value or any packages inside your vehicle - not even in the glove compartment or under the seat. Car thieves routinely check these locations, especially for cellular phones, cameras, laptop computers, and other valuable items.
Always choose a well-lighted parking space in a busy area.
To avoid having your vehicle towed by car thieves, turn the front wheels into the curb as far as you can and put on the hand brake.
In a public spot, leave only your car key with an attendant.
Have an anti-theft device installed to make it harder for thieves to steal your vehicle.
Have the windows and main parts of your vehicle engraved to make resale more difficult.
Never leave your keys in an unattended car, not even for one minute.

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