How to Avoid Car Insurance Debt

Comparing quotes is a great way to avoid going into debt to pay for your car insurance. Most companies offer affordable payment plans, including monthly and quarterly options.

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Zaneta Wood, Ed.S. has over 15 years of experience in research and technical writing bringing a keen understanding of data analysis and information synthesis to reach a wide variety of audiences. She studied adult education and instructional technology at Appalachian State University as well as technical and professional communication at East Carolina University. Zaneta has prepared technical p...

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Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP®

UPDATED: May 4, 2020

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Here's what you need to know...

  • Know exactly what type of insurance you need before deciding to pay a lot of extra money for unnecessary coverage
  • Most car insurance companies offer several different payment methods to help alleviate the upfront cost of insurance
  • Sometimes changing insurance providers can offer a discount; sometimes it is better to stay with your current provider
  • Be careful about scams that promise a lot but end up costing you more than you can afford
  • Shop around and get several insurance quotes before choosing one company from which to buy coverage

When buying car insurance, debt can easily be avoided by proper planning and comparison shopping. Insurers offer a variety of discounts and payment options to help you afford car insurance.

Borrowing money isn’t bad in itself, but if you’re not careful when buying car insurance, debt might accompany your plan. The best plan for managing debt is to avoid it in the first place.

Enter your ZIP code to get free car insurance quotes now!

Ways to Stop Car Insurance Debt Before You Have a Policy

A common scenario is that people have very little money but are in need of car insurance to drive to work to earn more money. They are not in debt yet but buying car insurance might put them there.

There are some ways to lessen the amount you pay for car insurance, so you don’t have to go into debt.

Choose the type and amount of car insurance you need

There are many different types of car insurance. Once you decide what kind of coverage you need, don’t let an insurance agent talk you into buying more.

Look for discounts on your car insurance policy. Are you an excellent driver with no points on your license? Do you have good credit? Does your child do well in school? If the answer is yes to these questions, you could qualify for discounts that could save you hundreds of dollars.

Decide on the payment method that’s right for you

Insurers offer a variety of payment options so search for a company that will give you the coverage you need for the price you can afford.

These ways to save money and avoid car insurance debt are only a few of many. Surf the Web to find other ways, or better yet, enter your zip code on this website to get the information faster.

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Enter your ZIP code below to view companies that have cheap car insurance rates.

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Free Car Insurance Comparison

Enter your ZIP code below to view companies that have cheap car insurance rates.

 Secured with SHA-256 Encryption

Can Changing Companies Prevent Car Insurance Debt?

A reason you might consider changing your insurance company is if your circumstances might have changed. Many aspects of your life can have an impact on your car insurance.

  • Maybe your credit score has changed. If it rose, your insurance company might give you a discount. If it fell, you might find an insurer that values driving histories over credit reports.
  • You could have changed jobs and have a shorter commute or no commute at all if you work from home. Insurers take your yearly mileage into account when calculating the price of your insurance policy, so if you drive less you could pay less.
  • Did you buy a house since you bought your car insurance policy? If you have, you should check into getting your car and home insurance at the same company. Many insurers offer discounts to clients who have multiple policies with them.

These are just a few ways you can keep yourself out of car insurance debt by shopping around when it’s time to renew your policy.

What are some of the scams that may cause car insurance debt?

If you have car insurance but are looking for a cheaper policy, there are some scams you should know about to avoid car insurance debt.

Car insurance companies use different ploys to get you to buy insurance with them, especially when the economy is at its worst or when business is down so insurers need to drum customers up.

  • The company’s agents will give you one-on-one attention.
  • The company will save you more than your current insurer.

The idea of a personal relationship with your agent sounds good, but the implication is that you will pay a little bit extra for this treatment. Also, once agents know you and your family, they can begin to see your “needs” and try to sell you more insurance than is necessary.

Having a personal insurance agent is like having a personal sales person whose only purpose is to get more money out of you.

As for the save more money here than a there line, it too is just a ploy. By advertising this, insurers make you believe that everyone will save money by switching to them, regardless of their current policies.

The truth is that everyone who left their old company to come to them did save money, but they don’t mention the many others who called and found that their current company has the better deal.

Car insurance can cost a lot and put a big hole in your pocket, but you don’t have to pay so much that you go into debt.

Enter your ZIP code now to get free online car insurance quotes today!

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