As stay-at-home orders linger, many folks have ditched their commutes for remote work. Less time in the car has had some positive effects, like less traffic and fewer accidents. These changes have also had a positive impact on the car insurance industry.
With fewer cars on the road, there haven’t been as many insurance claims—along with a surge in profits for auto insurers. In fact, many companies gave customers premium kickbacks or discounts this spring. These companies have also offered coronavirus hardship assistance to those who asked for it.
But as states begin to reopen—and vehicles crowd the roads again—companies may start to hike insurance premiums once again. If you receive a bigger quote or bill than you expect, here are some ways to manage it.
Shop around
Americans spend an average of $1,548 per year on auto insurance, according to The Zebra. But as you compare policies, you will notice there’s a range of premiums between companies. Factors like your coverage level, age, gender, driving record, credit score, location, and type of vehicle may all impact your insurance quotes.
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Increase your deductible
Most policies have a $500 deductible—which means you have to pay the first $500 before your insurer starts to chip in for expenses. If you have a solid emergency fund, though, it may be worthwhile to increase your deductible. You may save on premiums but you will also have to pay more out-of-pocket for accidents.
Ditch coverage you don’t need
While it may be too risky to reduce liability coverage, you may have some wiggle room with collision or comprehensive protection. Both may be optional by law, depending on where you live, according to the Insurance Information Institute. You may be an ideal candidate for dropping these coverages if you drive an older car you own outright—especially if you’re not using it much during the pandemic.
