There is no hiding it! Vehicle insurance premiums are not remaining the same. Increases are heavy across the country and certainly here in Tennessee. With our customers, we continue to find ways to SAVE MONEY to offset some of these premium increases. Here is some information I saw in a consumer magazine that is an echo of some of the things we are telling our good customers every day. Spend a couple of minutes, digest the content and let us know if we can assist you with any changes you might like to consider making.
Like many other Tennesseans, you’ve probably watched your car insurance premiums go up hundreds of dollars over the past two years. Even as inflation has cooled, insurance prices have remained high due to more crashes, increased litigation, and higher repair costs. Nationwide, the average premium increase was more than 20 percent over the past year, according to the Federal Bureau of Labor Statistics. But people in some states have experienced even more pain, with rates up 88 percent in Florida and around 50 percent in Colorado, Nevada, and New York from 2018 to 2023, according to FINN, a car subscription service company that analyzes market data.
How can you lower your premiums? At Benton White Insurance, since we are an independent agency, we have many companies from which to choose. We may recommend changing insurance companies to help cut your insurance cost. Some of our clients we helped move to another company saved considerable money from our recommendation.
Let’s look at other ways to save!
How much you can save: $400 to $500 a year
This timeless insurance advice saves you money because you’re increasing your potential out-of-pocket cost for repairs after a crash. Loretta Worters, vice president of media relations for the Insurance Information Institute, says that increasing your deductible from $500 to $1,000 can bring your annual premium down by 20 to 25 percent, on average.
“Just make sure you can afford to pay cash for repairs if you need to,” Bell says. “The average motorist doesn’t file a claim more than about once every couple of decades, so your likelihood of having to shell out for crash damage is actually pretty low.”
- Drop Collision and Comprehensive Insurance
How much you can save: About $1,000 a year
Collision insurance covers damage to your car if you’re involved in a crash (or if you’re the victim of a hit-and-run) and comprehensive covers damage caused by acts of nature—such as storm damage—vandalism, theft, fire, and more. As the years and miles pile up on your car, its value will decrease. Eventually, that lowered value may no longer justify the expense of paying for collision and comprehensive coverage. “As a general rule, when the premium is more than 10 percent of the car’s value, it’s time to consider dropping collision, and maybe comprehensive, too,” Bell says. You may want to keep comprehensive a bit longer because it includes glass coverage, which is always nice to have if a rock hits your windshield and cracks it. But if you’re scaling back to liability-only coverage, make sure you have enough to protect yourself from having to pay out of pocket for someone’s property damage and medical expenses if you’re found at fault in a crash.
- Take a Defensive Driving Course
How much you can save: $200 a year
Some insurance companies will allow you to take a safe-driving course to get a discount, although you’ll have to take it again every few years to keep the discount active. In Tennessee, a Defensive Driving Course is offered ONLINE that costs around $30.00 Many of our companies offers discounts if you take a course like this or similar.
- If You Drive Under 10,000 Miles a Year, Report Your Mileage
How much you can save: About $100 a year
“Most insurance companies include annual mileage in their pricing methodology, and lowering your miles can save you money,” says Douglas Heller, director of insurance with the Consumer Federation of America. For instance, if you’re driving less because of a change in your job location, you may qualify for a lower premium, especially if you’re driving less than 10,000 miles in a year. “Some companies offer verified mileage programs where you can get even more savings by reporting your odometer reading on a regular basis.”
- Bundle Your Auto Coverage With Your Homeowners Insurance
How much you can save: $300 a year
Some of our deepest discounts come from combining your home, auto and personal liability umbrella with the same carrier. You can save substantial premium when we create a portfolio of coverage’s for you.
6. Pay Out of Pocket for a One-Car Fender Bender
How much you can save: $300 or more (depending on your driving record)
If you’re involved in a crash with another vehicle that results in property damage, many states require that you submit an accident report (and you must report an accident with injuries or death to the police). But for minor damage that doesn’t involve another driver—such as scraping your bumper on a support column in a parking garage—paying out of pocket and not filing a claim could prevent a potential rate increase. Keep in mind, though, that what seems like minor damage to a car equipped with safety features such as automatic emergency braking and blind spot warning could be far more expensive to repair than you think. So make sure you get a repair estimate before you decide to shoulder the financial burden on your own.
7. Sign Up for Driver Monitoring
How much you can save: $800
Several of our insurance companies offer a discount if you allow them to monitor your driving habits with a smartphone app or a device that plugs into your car’s diagnostic port. There’s a potential for huge savings, but you have to be okay with giving up a certain amount of privacy, allowing your insurer to track your every move in much the same way that you do when using certain smartphone apps. We can give you facts that would help you to decide if monitoring is best for your situation. You need to consider what data it will use to calculate a discount, whether any negative driving behavior has the potential to actually increase your rate, and how all the data collected can and will be used.
How Much Liability Coverage Is Enough?
Insurance companies can offer several types of coverage to protect you financially when you’re involved in a crash. But the most important is liability coverage, which pays for costs related to the injury or death of passengers in another car as well as any damage to other vehicles and property if it’s determined that you were at fault in a crash. (Liability coverage also covers passengers in your car.)
Almost every state requires liability coverage including Tennessee. We always suggest to have more liability than Tennessee state minimums because those state coverage limits are VERY LOW. Experts say most state minimum coverage requirements are woefully inadequate. Douglas Heller of the Consumer Federation of America cites as an example a driver covered only by some states minimum requirement who causes a crash in which three people have $50,000 in medical bills per person. The driver’s insurer would cover $20,000 of each injured person’s medical bills, leaving the driver responsible for any outstanding bills—in this example, $90,000. Ouch!
How much coverage is enough? Loretta Worters of the Insurance Information Institute recommends a minimum liability coverage of $100,000/$300,000/$100,000. For more protection, experts recommend purchasing an umbrella insurance policy on top of higher-limit liability coverage. An umbrella policy added to a homeowners policy extends liability protection to $1 million or more, and depending on the insurer, fills whatever gaps may have been left by auto and homeowner policies.
You can usually buy an umbrella policy only from a company that you’ve already purchased insurance from. Prices vary depending on what types of coverage you already have—car, home, boat, business, etc. You also need to know how high your basic liability insurance needs to be and if your insurer requires bundling all of your policies to get the umbrella policy. Worters says a $1 million umbrella policy typically adds $250 to $300 to your annual premiums.
There’s also coverage that pays for damage caused by uninsured and underinsured motorists, as well as personal injury protection or medical payment coverage, which covers your own injuries if the other driver has inadequate coverage or none at all. Worters says these are always good to have.
Life Events That Can Affect Your Car Insurance Rates
Getting Married or Divorced
Adding a driver to a policy can increase premiums, but if that person has a clean driving record, your rates shouldn’t change much. Adding someone with a history of filing claims or with moving violations on their record, on the other hand, can increase your rate, whereas removing that person can result in significant savings.
Changing Jobs
You could pay a lower premium if your new commuting distance is shorter or if you’re now working from home. You can generally save $100 on premiums if you drive less than 10,000 miles per year.
Moving to a New Area
Insurance rates are highly dependent upon where you live.
Adding a Teen Driver
Drivers between the ages of 16 and 17 are more likely to be involved in a crash than any other group. Adding a teen driver to your insurance policy can increase it a staggering $1,000 to $2,000 a year or more.
If You’re Over 70, Read This
Car insurance premiums tend to decrease as you age. But that can change once you reach your 70s, which is when crash rates begin to slowly tick up, according to the Insurance Institute for Highway Safety (IIHS). Based on average annual insurance costs from Bankrate, a consumer financial services company, premiums for 70-year-old drivers are about 8 percent higher than for drivers who are 60 years old.
We have a couple of companies that actually favor higher age drivers. So we can help!
Upgrade to a car with advanced safety systems. Cars with active safety equipment like automatic emergency braking (AEB) and strong crash-test ratings are good for everyone, but especially for older drivers. That’s because those drivers are more likely than other motorists to suffer from serious injuries if they’re in a crash, the National Highway Traffic Safety Administration says. And according to two IIHS studies, they tend to drive older vehicles that lack lifesaving features such as blind spot monitoring, side or curtain airbags, forward collision warning, or automatic emergency braking.
Take a driver education course. Classes for mature drivers could reduce your risk of an accident or injury and related expenses. Groups like AAA offer programs to help older motorists with declining hearing, eyesight, flexibility, and other conditions that can impair driving ability adapt their habits and sharpen their skills. AARP, for example, offers a discount on these courses to members.
Let us know how we can help you. We feel your pain! Our insurance rates for our vehicles have increased too. So we are very aware of increases and ways to consider helping you with yours.
We do our best to be available at the times you need us most. And if we are not, we have other avenues for you to connect. TEXT or CALL 615.377.1212, visit www.BentonWhite.com for a variety of information and service features that can assist you 24 hours each day. EMAIL us at info@BentonWhite.com or you can respond by text directly from our website.
We’re here – doing out best to earn your business. And if you aren’t with us yet, COME on over! We’ll treat you like we want to be treated and we will KNOW who you are in a language you can understand.
Thanks for reading the blog! Pass it along if it’s been helpful to you!
Portions of this blog post were from an article by Benjamin Preston / Consumer Reports – March 3, 2024.
