Driving a vehicle is a massive responsibility.
Not only do you need to comply with the road rules, pay for financial obligations that go hand-in-hand with owning or financing a car, and ensure that your actions do not affect others, but you also need to consider other factors that may influence your insurance premium. Most people aren’t aware of what their actions could lead to, and most of the time, poor driving habits could be costing you more than you think on monthly maintenance and premium costs.
There are a few factors that affect your insurance costs and finance deal, for instance, the type of car you drive, your age and your driving history. If you’ve been involved in a number of accidents before, your rates will increase as well as if you’re under the age of 25. Insurance providers deem these, along with the below reasons, as red flags. Of course, you cannot change the above-mentioned factors, but you can be more conscious of your general habits.
Here are a few tips to consider if you want to lower your insurance premium:
Traffic fines
You might not think so, but every movement with your vehicle has an effect on how much insurance you pay. For instance, fast driving and consistent traffic fines can increase your premium as it’s seen as irresponsible. You should be sticking to the legal driving limit, without being careless. If insurance companies see that you are picking up regular fines, they will increase your payment as this is a violation of the law. There are enough warning signs to alert you before a speeding camera, as well as speed limit boards to show you at what speed you should be travelling at.
Car accidents
Unfortunately, you cannot prevent a car accident from happening. But you need to know how to handle them when they do. The type of accident you have can result in insurance companies feeling that you aren’t focused on the roads or failing to adhere to the correct road rules. Even though you will be claiming from your insurance if there is damage on your car, if you are found at fault, insurance companies will increase your premium rates. A high premium is put in place to encourage drivers to be more alert and focused on the road, avoiding the need for payment to increase.
Agreeing to the first quote you see
Before you buy a car, you need to apply for vehicle finance. Once you’ve earned the pre-approval on vehicle finance, you can start shopping around for a car in the price range you can afford. Often times, the car excitement gets the better of you and you don’t always know how to go about finding an insurance provider with rates to suit your pocket. It’s very important to shop around for various quotes in the beginning stages so that you can find something that is better suited to your budget, without having to pay an arm and a leg for insurance. If you don’t shop around, you will regret it when premiums increase.
Not devaluing your car
Every year, your car depreciates in value. Depending on the type of car it is, it might not be as much as you’d hoped for but it will certainly be an amount worth saving. If you are driving an old car, you will be surprised at how much your vehicle depreciates over time, and this is an amount that you can save every month. Make sure that you contact your insurance provider to assist you with this if you haven’t yet. If, on the other hand, you are going to be buying a new car and need to apply for finance, always consider the vehicle finance pre-approval amount with your new insurance premiums to see what monthly instalments you can afford.
Automatically renewing your policy
It is recommended that when it comes to renewing your policy every year, you should actually do so without simply agreeing to it. Think about how much your insurance has increased over the years, and don’t simply agree to a renewal without working out the numbers. Companies can easily take advantage of regular customers. So, when you renew your policy, be sure to find out all the nitty-gritty so that you don’t feel surprised when you see your next payment go off of your bank account.
Final thoughts
There are so many minor tips to consider which can have a significant impact on your finances and how much you could end up spending unnecessarily. If you’ve been approved for car finance pre-approval in South Africa, for a new car you want to buy for your spouse or child, take the time to look into the insurance rates on each car before you consider the model for how it looks. And remember these amounts will only continue to increase. While insurance professionals or brokers will not advertise the loopholes on their websites, agents will always be happy to communicate the best possible plan for your budget and needs. Authorised financial services should assist you by giving you similar tips on how to save on premiums. So, always make an effort to go the extra mile to speak to someone who can guide you in the right direction.