How to Know You're Paying Too Much for Auto Insurance in Salem

I can't think of anyone who looks forward to buying auto insurance, particularly when the price is too high. There is such a variety of to buy insurance from, and although it's nice to be able to choose, so many choices can make it hard to compare rates.

It's important to get comparison quotes periodically because prices are constantly changing. If you had the best deal six months ago you can probably find a better price now. So just forget anything you know (or think you know) about auto insurance because you're going to get a crash course in the proper way to save on auto insurance.

Understand what determines the rate you pay

Consumers need to have an understanding of the rating factors that come into play when calculating the rates you pay for auto insurance. Knowing what impacts premium levels helps enable you to make changes that may reward you with better auto insurance rates.

The list below includes some of the factors that factor into rates.

With age comes lower rates - Youthful drivers in South Dakota tend to be more careless behind the wheel so they pay higher auto insurance rates. If you've ever had to add a young driver onto your auto insurance can really hurt. Older drivers are viewed as being more responsible, tend to cause fewer accidents and get fewer tickets.
Clean credit earns discounts - Credit rating is a huge factor in determining your rates. Consumers who have excellent credit tend to be less risk to insure than those with poor credit. If your credit score can use some improvement, you could save money insuring your by spending a little time repairing your credit.
Special features that cut premiums - Owning a car with anti-theft technology or alarm system can get you a discount on your auto insurance. Anti-theft devices like vehicle immobilizer systems, General Motors OnStar and LoJack tracking systems can help prevent your vehicle from being stolen.
What are your deductibles? - Coverage for physical damage, also known as collision and other-than-collision, is used to repair damage to your car. Some examples of claims that would be covered would be running into the backend of another car, collision with an animal, and rolling your vehicle. Physical damage deductibles are how much you are required to spend out-of-pocket if you file a covered claim. The more money the insured has to pay upfront, the lower your rates will be.

Are you getting all your discounts?

Car insurance companies don't always list all their discounts very clearly, so here is a list both the well known and the harder-to-find ways to save on auto insurance. If you're not getting every credit you qualify for, you are paying more than you should be.

Save with a New Car - Buying coverage on a new vehicle can cost up to 25% less compared to insuring an older model.
Passive Restraints and Air Bags - Factory air bags or motorized seat belts may earn rate discounts of 20% or more.
Pay Upfront and Save - If paying your policy premium upfront instead of making monthly payments you could save 5% or more.
College Student - Any of your kids who live away from home without a vehicle on campus can be insured at a reduced rate.
Homeowners Savings - Owning a house in Salem may earn you a small savings because of the fact that having a home requires personal responsibility.
Federal Employees - Employees or retirees of the government can earn a discount up to 10% with select insurance companies.

A little note about advertised discounts, many deductions do not apply to the entire policy premium. Most only cut the price of certain insurance coverages like liability, collision or medical payments. So even though it sounds like you would end up receiving a 100% discount, you won't be that lucky.

To choose companies with the best auto insurance discounts in South Dakota, click this link.

How can Progressive, GEICO, Allstate and State Farm save drivers who switch?

Consumers in South Dakota can't ignore all the ads for cheaper car insurance from companies such as Progressive, GEICO, Allstate and State Farm. They all seem to make the same claim about savings if you move your policy.

How does each company claim to save you money? This is how they do it.

Different companies have a certain "appetite" for the right customer that makes them money. An example of a desirable insured might be a mature driver, a clean driving record, and has a high credit rating. A customer getting a price quote who matches those parameters will qualify for the lowest rates and as a result will probably save when switching.

Potential customers who are not a match for these standards will have to pay a higher premium which leads to the customer not buying. The ad wording is "drivers who switch" not "everybody who quotes" save that kind of money. That is how companies can truthfully state the savings. Because of the profiling, you should compare as many rates as you can. It's impossible to know which company will have the lowest rates.

Tailor your coverage to you

When buying proper insurance coverage for your vehicles, there isn't really a perfect coverage plan. Every insured's situation is different so this has to be addressed. For instance, these questions may help highlight whether you would benefit from professional advice.

Should I file a claim if it's only slightly more than my deductible?
Should I drop comprehensive coverage on older vehicles?
What can I do if my company won't pay a claim?
Why does it cost so much to insure a teen driver in Salem?
Does my policy cover my teen driver if they drive my company car?
Am I covered if I drive in a foreign country?

If it's difficult to answer those questions but you think they might apply to your situation, you may need to chat with a licensed agent. If you want to speak to an agent in your area, fill out this quick form or you can go here for a list of companies in your area. It is quick, free and may give you better protection.

Even more information is available at the South Dakota Division of Insurance website. Visitors are able to read enforcement actions against agents and companies, find out industry alerts, view a list of available companies, and report car insurance fraud.

In the end, you save

As you restructure your insurance plan, it's very important that you do not buy poor coverage just to save money. There are many occasions where someone dropped liability limits or collision coverage only to find out that they should have had better coverage. Your aim should be to purchase a proper amount of coverage for the lowest price.

We covered many ideas to save on auto insurance. The key concept to understand is the more times you quote, the better your comparison will be. Drivers may discover the best price on auto insurance is with a lesser-known regional company. Some small companies may cover specific market segments cheaper than the large multi-state companies such as .