While more than 40% of commuters in Toronto use sustainable forms of transportation, there are still millions of cars on the road. There's a high cost of living in the city and everyone is looking for ways to save money on the things they need. If you're looking for how to get cheap car insurance in Toronto, it's easier than you might think
Here are seven things you need to know to save money on car insurance.
1. Think of Insurance When Car Shopping
If you're in the market for a new car, you might not be thinking about car insurance. You're going to be thinking about mileage, horsepower, seating space, or maybe just color. While you might not think any of these things have to do with insurance, they can have a real impact.
During the car shopping phase of your journey, thinking about fuel efficiency and repair costs can help you consider insurance. However, you need to also think about theft. A car that has a higher chance of being stolen could be a greater insurance risk that you might realize.
You might want to drive around town in a flashy and nice looking car but if you're attracting the wrong kind of attention, you're going to be paying a lot more. The cheapest rates are for safer cars that are more durable than the average vehicle. Extra safety or anti-theft features could bring down the price of your insurance in a major way.
Contact your insurance company in advance to see how rates might differ for different cars before you buy.
2. Look For Discount Programs
Lots of insurance companies offer discount programs and price breaks when you extend your insurance with them. For customers who have renters or homeowner's insurance, insurance companies will lower the price for other types of coverage. If you have multiple cars, put them under your name on a single policy to bundle the costs and save money.
If you're a good driver, you should maintain a clean record to save money. Insurance companies don't want to insure someone who is accident prone. Stay safe, pay attention when driving, and keep yourself from texting while driving to keep costs down.
Some insurance companies will give you a discount if you pay up front. Often you'll get a bill that gives you two figures when you first sign up. There will be a price if you're willing to pay for an entire year up front and another higher price if you pay your bill on a monthly basis.
If you're a member of a union or a professional organization, you could save money. Some unions offer their members a discounted price to buying insurance if they're a card-carrying member.
3. Always Pay On Time
Believe it or not, some people with good credit scores spend less on insurance. Your quotes could be based on your ability to pay and your positive financial status. While this isn't true everywhere, some provinces allow insurers to look at credit ratings when offering insurance quotes.
This is because decades of statistics have shown that people with better credit file fewer claims. This difference isn't minimal at all. You could be paying hundreds more per month if you don't have a strong credit rating and have racked up all kinds of debt.
Thankfully this isn't the case in Ontario. It's actually unlawful for insurers to look at your credit rating. However, you could be given a higher rate for paying late too often.
You should always be looking to improve your credit so that you can achieve your financial and wealth goals. One of the best ways to do this is to always pay your bills on time, car insurance and otherwise.
Reducing your debt will help save you money on car insurance over time. If you don't know your credit score, start tracking your credit rating regularly so you can get a feel for what you can do to improve.
4. There's No Monopoly on Good Prices
While you might see lots of ads telling you that going with one company can save you more than any other insurance company, rates can vary wildly. Even two people at the same company can be offered different rates. No one insurance company is going to be the arbiter of the lowest prices.
Because of local regulations, tax incentives, and all kinds of individualized reasons, insurance rates could be different from place to place. Even if your friends or family just over the border swear by one company, that company might be the most expensive option in Toronto.
You need to shop around for the best rates. You can also comparison shop openly between companies. If you want to get insured by one company, let them know what you're being offered by another.
You could be paying hundreds more every year by failing to do some basic comparison shopping. Rates can change every year, so make sure you compare prices every time you renew your contract with your insurance company.
5. Look Into Local Companies
If you're not looking at all of the options available, you could be spending more than you need to on insurance. There are dozens of insurance companies operating throughout Ontario and if you don't look at your options, you could end up overpaying.
Just a few major companies are going to have the monopoly on the majority of business by how much they can afford in advertising and promotion. That doesn't mean that they're the best that Ontario has to offer.
Small, regional insurance companies can offer rates that you might not be able to get anywhere else. You might even find that reviews are better for these small insurance companies. Because they're smaller, they'll offer good customer service and offer good rates without having to jump through hoops of talking to several layers of supervisors.
Company size doesn't' really matter when it comes to insurance companies. If they can offer you a better deal and give you what you need, that's all that matters. You should work with a company who values your business and wants to keep you as a customer.
6. Leave Comprehensive Coverage Behind
If you're insuring a used or older car, you might not need as much insurance as you would for a new car. New cars are a higher insurance risk because small dents and problems with the exterior cost more to fix. For older cars, it's possible to find cheap replacement parts in good condition.
Collision coverage is intended to pay for the damage that your car incurs following an accident. If you have an older car, you might not care as much about how it looks on the outside than a car that's brand new.
Comprehensive coverage can cover your car if a deer crashes into it, it gets set on fire, or gets vandalized. If you're not worried about freak accidents, acts of God, or anything major happening to it, you could save money.
Remember that the amount that's going to be paid out to you following something happening to the car is based on the value of the car. An older car has a low market value and could end up costing you more in insurance that it's truly worth. If you don't have the hottest ride in Toronto, you might be able to skip some types of coverage.
7. Pay a Higher Deductible
Just like in health insurance, the higher your deductible is, the lower your payments are. If you're only going to pay the first $100 of your car's damage and expect the insurance company to pay the rest, that's going to cost you a lot every month. If you're willing to shell out the first $5,000 on damage to your new car, you might be paying much less.
If you're willing to shell out the costs in covering damage to your vehicle like dings and scratches, you don't need to have too much coverage. However, you can't lower the costs of liability insurance, as that's the damage that you do to others in case of an accident.
If you're looking to save money on covering a used car but need collision and comprehensive coverage, increase the deductible to save now.
Learning How To Get Cheap Car Insurance Takes Trial and Error
If you're just now figuring out how to get car insurance, you might find that it takes a little bit of effort and research. However, when you're trying to cut costs, that time you invest will pay off in the end. The more you save on car insurance, the more you can spend on other things in your life that you enjoy.