How to pay less for car insurance

Consumer Reports

TAMPA, Fla. (WFLA)- Imagine paying less for car insurance just for being a good driver.

It’s called usage-based insurance. All you must do is drive safely and keep within mileage limits and you could save a bundle on premiums.

But doing so also means having your insurance company track how you drive—and that could drive you up the wall.

“I decided to do it really for the saving,” said Roger Lane, who recently signed up for usage-based car insurance.

Lane is hoping to save 20 to 30 percent off the $2,500 he’s been paying yearly on premiums.

Numerous major insurance companies like State Farm, Nationwide, Allstate, and Liberty Mutual offer the program.

Using a smartphone app and a tag or dongle, insurance carriers monitor acceleration, braking, cornering, speed, and phone use, and provide a score.

“This last trip gave me a rating of five stars,” said Lane.

If your score indicates low-risk driving, your premiums could be reduced significantly — in some cases up to 50 percent.

“I think that this gives an extra impetus to really follow speed limits,” Lane said.

To get the discount, you’ll also need to watch how far you drive. State Farm, for example, considers 7,500 miles a year or less to be low mileage. But if your driving suggests risky behavior, some insurers could charge you even more. And while some companies say they don’t share your information, for some people, privacy may be a concern.

“If you’re in an accident, your information can be used, for example, by law enforcement,” said Consumer Reports’ Tobie Stanger.

“I don’t have a problem with that. I have a cell phone as it is, so the fact that I could save money by being watched is acceptable,” said Lane.

To keep your car insurance costs low, make sure you’re taking advantage of all available discounts.

Ask about discounts for the safety and security features built into your car, good student discounts, even discounts for maintaining a good credit score!


Copyright 2020 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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