How to Develop the Skill of Negotiating Better Insurance Rates

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Insurance rates often vary by state, with some states having much higher rates than others. This is perhaps because insurance companies base their rates on state laws. 

Also, different insurers use varying algorithms to determine the rates for every target group, which explains why the rates may differ from one company to another. 

While there may not be much room for negotiations, you can lower your interest rates by understanding how the insurance industry operates. This post highlights ideas that can help you get better insurance rates for your car or any other type of insurance.

Insurance rates hands car crystal ball

Shop around

Staying with an insurer for a long time may not be a bad idea as it could earn you loyalty discounts. But that may not be the case after a claim against your insurance or when you need to buy a cover for a teenage driver. In such circumstances, shopping around can be a good idea.

Insurance companies will charge different prices for different packages. For example, one company could have excellent rates for older drivers compared to all other providers in the market but have the worst rates for teen drivers, which means they can be a perfect option for an older driver but not so much for teen drivers. 

When shopping around for insurance, you must consider your circumstances and choose the best option that meets your expectations.

Increase your deductibles

After an accident, insurers require the policyholder to pay a specific amount from out-of-pocket cash when filing a claim. This money is referred to as the deductible and is a deterrent against making claims for minor damages. 

Insurance companies offer policyholders the option of increasing or lowering the deductible, which affects the premiums. 

When a driver chooses a high deductible, filing a claim for damages lower than the deductible does not make sense. Also, if the damages exceed it, the insurance company will not need to chip in as much, thus lowering the risk on their part. As a result, the insurance will offer the policyholder a better rate.

Identify possible discounts

Different groups of people may be eligible for varying discounts. For instance, you and your household members could qualify for discounts if you are an active or a retired service member. 

However, the discounts do not mean that all insurance companies will offer the best rates. You will need to shop for insurers with the best rates in your state. 

The best way to do this is by turning to a reliable resource for car buyers or owners in your group. For example, if you are a veteran or an active service member looking to buy a policy from an insurer like USAA, it’s best that you first take a look at fact-checked USAA reviews from an online resource like Motor1 before making a decision.

Ask for multi-car insurance

Insurance companies often offer a discount for insuring vehicles in the same household under one policy. The standard rule is that the cars must not exceed five and must belong to immediate family members living under the same roof. 

This means roommates cannot enjoy the same benefits. Sometimes your insurance agent may not tell you about multi-car insurance discounts if you do not ask. So consider asking as part of negotiating a good deal. 

Multi-car insurance works best when all drivers in the pool are safe drivers. If one driver in the group gets a severe moving violation conviction like a DUI, the premiums for the multi-car policy can increase significantly.

The same applies if you add a teenage driver to the pool. So before bundling your cars into one policy, it’s best to consider prevailing circumstances to ensure it’s the best option.

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