Contact: Loretta Worters, 212-346-5545
NEW YORK, May 24, 2001 - With auto insurance rates on the rise for the first time in several years, it's important that consumers take control of their insurance-buying decisions, according to the Insurance Information Institute (I.I.I.).
The I.I.I. says that auto insurance rates will rise two to four percent in 2001 after several years of little or no increase. Higher rates are the result of increasing costs associated with providing medical care to people injured in motor vehicle accidents, higher motor vehicle repair costs and soaring jury awards.
Smart consumers can reduce the cost of their auto insurance rates by following these tips:
- Shop around and compare prices.
Insurance costs vary dramatically from company to company, so it pays to shop around. Ask your friends, relatives and co-workers for the names of companies or agents they have had a good experience with. You can also go on-line or get a list of insurers from your state insurance department. And don't buy based on price alone - pick a company or agent that has a reputation for good service.
- Before buying a car, check insurance costs.
Insurance premiums are based in part on the car's value, the cost to repair it, its overall safety record, and the likelihood of theft. Select a car that you can afford, in terms of its cost and the amount you will need to insure it.
- Take a higher deductible.
A higher deductible can lower the cost of insurance substantially. For example, increasing your deductible from $200 to $500 could reduce your collision and comrehensive coverage cost by 15-30 percent. Going to a $1,000 deductible can save you 40 percent or more.
- Drop unnecessary coverages.
Drop collision and/or comprehensive coverages on older cars. In many instances it is not cost- effective to continue to buy these coverages as the value of your car depreciates. Auto dealers, banks and buyer's guides can tell you the worth of cars.
- Keep your credit clean.
Your credit rating may affect what you pay for insurance. And while this varies from state to state and company to company, drivers with a good credit history may be rewarded with a lower rate.
- Ask about all available discounts.
You might get a break if you car-pool to work, take a driver education course or a defensive
driver-training course, or if you insure multiple cars with the same insurer. Some companies also give discounts to students with good grades or for low mileage..
And don't forget to drive safely. Those with poor driving records are seeing the highest increases in their auto rates.
Consumers can obtain more information on how to lower their auto insurance rates by accessing the I.I.I.'s Web site at http://www.iii.org or by calling the National Insurance Consumer Helpline at 1-800-942-4242.
The I.I.I. is a non-profit, communications organization supported by the property/casualty insurance industry.