Auto Insurance In Texas: Saving Money Strategies

Auto insurance in Texas can be expensive, but there are ways to save money. Shopping around for the best policy for your needs and budget is a good place to start. You can compare rates and coverages on HelpInsure.com and the Office of Public Insurance Counsel's website. It's also worth asking your insurance company about discounts, for example, for driving fewer miles, maintaining a good driving record, or setting up automatic payments. You can also choose a higher deductible, which will lower your insurance premium, but remember that this means you'll pay more out-of-pocket if you do have a claim.

Shop around for the best policy

Shopping around for auto insurance in Texas is a great way to save money. It's important to find a policy that meets your needs and budget. Here are some tips to help you shop around for the best policy:

• Use online tools: Utilize websites like HelpInsure.com to compare rates and policies from different insurance providers. This will give you a good starting point for your search.
• Get multiple quotes: Contact several insurance companies and request quotes. Be sure to provide the same information to each company so you can make an accurate comparison. You can get quotes by phone, through an agent, or online.
• Consider your needs: Think about the type of coverage you need. The state of Texas requires a minimum level of liability coverage, but you may want to add additional coverages like collision, comprehensive, or uninsured motorist protection. Consider your driving habits, the value of your car, and your financial situation to determine what type of coverage is best for you.
• Look for discounts: Ask each insurance company about any discounts you may be eligible for. For example, many companies offer discounts for safe driving, bundling policies, paying premiums in full, or being a good student. See if you can lower your premium by taking advantage of these discounts.
• Check customer satisfaction: In addition to cost, consider the quality of service you'll receive. Look at customer satisfaction ratings and reviews to get an idea of each company's reputation. You can refer to sources like J.D. Power's auto insurance customer satisfaction survey or the National Association of Insurance Commissioners' complaint index.
• Understand the policy: When comparing policies, make sure you understand what is covered and what is not. Review the declaration page, which summarizes the coverages, dollar limits, and deductibles. Pay attention to the fine print and ask questions to clarify any uncertainties.
• Call the Texas Department of Insurance (TDI) Helpline: Before purchasing a policy, you can call TDI at 800-252-3439 to check the insurance company's complaint record and ensure they are legitimate.

By following these steps, you can shop around effectively and find the best auto insurance policy that suits your needs and budget in Texas.

Ask about discounts

Discounts are a great way to save on auto insurance in Texas. It is important to ask your car insurance company about any discounts they offer, but also to do your own research, as they should sign you up for the discounts you qualify for but might not do so without prompting.

You may be eligible for a discount if you:

• Drive fewer miles.
• Have a good driving record.
• Set up automatic payments and go paperless.
• Sign up for a driving monitoring program.
• Work in certain occupations or are a member of certain groups.
• Have airbags, antilock brakes, and antitheft devices in your car.
• Have completed a defensive driving or driver education course.
• Have more than one car on a policy.
• Have other policies with the same insurance company.

It is also worth noting that some companies offer a safe driving discount, which can range between 5 and 10% depending on the company.

Choose your deductible wisely

Choosing your deductible wisely is one of the most important things to consider when comparing auto coverage. A deductible is the amount you pay out of pocket before your insurance carrier starts paying for repairs. You will have to pay the deductible each time you file a claim.

Most drivers in Texas choose a $500 auto insurance deductible, but policies with higher deductibles cost less. The average auto insurance deductible is $500, but car insurance deductibles can range from a few hundred dollars to $2,500.

When selecting a car insurance deductible, it is important to follow these six steps to determine the best amount for you and your wallet:

• Choose between a high or low deductible: There is a fairly straightforward relationship between your insurance deductible and the rate you pay for your policy. Plans with lower deductibles usually have higher monthly premiums and vice versa. But if you choose a plan with a higher deductible to get a lower insurance rate, you’ll pay more out of pocket if you file a claim.
• Calculate the cost difference: When comparing auto insurance policies, looking at the difference in price between plans with high and low deductibles is a good place to start. But remember that your total cost will vary based on whether you file a claim. It’s best to run a few different calculations and compare your out-of-pocket expenses if you file no claims, one claim, or two claims.
• Evaluate the likelihood of filing a claim: In general, drivers who are more likely to file an auto insurance claim will have lower total costs with a low-deductible car insurance plan. Conversely, drivers who don’t file a claim will typically save with a higher deductible plan. However, when you opt for a plan with a higher deductible, you’re betting that you won’t have an accident.
• Determine the value of your car: Depending on where you live, most insurance companies will only pay up to the actual cash value of your vehicle if the insurer declares it a total loss. So, it’s generally better to have a lower deductible if your car’s not worth much. On the other hand, if your car is more expensive, a higher deductible makes more sense.
• Evaluate your cash savings: If you do get into a car accident, you’ll have to pay your deductible before the insurance company starts chipping in for repairs. If you don’t have savings or an emergency fund to cover a high deductible, it may be better to choose a low-deductible policy. The higher monthly bills for insurance premiums may be a better way to protect your finances if you have an accident.
• Assess your tolerance for risk: Choosing a high-deductible plan is a gamble that you won’t have a car accident. If you do have an accident with a high-deductible policy, you’re still covered, but you’ll pay more out of pocket after the accident than if you had a low-deductible policy.

Compare policies and coverage

Comparing auto insurance policies can be a tedious task, but it is an important one if you want to find the best deal. Here are some tips to help you compare policies and coverage when looking to save on auto insurance in Texas:

• Shop around: Just like with any major item, it is important to shop around and compare different insurance providers to find the policy that best meets your needs and budget. Texas has a Consumer Bill of Rights for auto insurance, and you can use resources like the HelpInsure website to shop for auto insurance.
• Understand the different types of coverage: There are eight basic auto insurance coverages in Texas, including liability coverage, collision coverage, comprehensive coverage, medical payments coverage, personal injury protection (PIP) coverage, uninsured/underinsured motorist coverage, towing and labor coverage, and rental reimbursement coverage. Each type of coverage offers different protections, so it is important to understand what is included in each policy you compare.
• Know the minimum requirements: Texas law requires drivers to show proof that they can pay for any accidents they cause. The minimum liability limits might be too low if you cause a multi-vehicle accident or the other driver’s car is totaled, so consider buying more liability coverage. Texas law requires you to have at least $30,000 of coverage for injuries per person, up to a total of $60,000 per accident, and $25,000 of coverage for property damage.
• Consider your needs and budget: Think about your specific needs and budget when comparing policies. For example, if you have an old car that's paid off, you may not need collision coverage. Review your coverage regularly to ensure it still meets your needs.
• Compare rates and discounts: Insurance rates can vary significantly from company to company, so be sure to compare rates from multiple insurers. Also, ask about discounts, as many companies offer discounts for things like driving fewer miles, maintaining a good driving record, setting up automatic payments, or having certain occupations or group memberships.
• Check customer reviews: In addition to the cost and coverage of a policy, consider the insurance company's customer service and claims satisfaction. Look at customer reviews to get an idea of what you can expect as a customer.

Buy only from licensed companies

When shopping for auto insurance in Texas, it is imperative to prioritize your financial security and only purchase insurance from licensed companies. Buying insurance from an unlicensed company could result in your claims going unpaid.

The Texas Department of Insurance (TDI) provides a Help Line that you can call to verify whether a company is licensed to operate in the state. By taking this simple precautionary step, you can ensure that your claims will be honored and that you are not left financially vulnerable in the event of an accident.

While shopping for auto insurance, it is also important to consider factors beyond the price of the policy. An insurance company's financial rating, for example, can give you an idea of how strong the company is financially. Additionally, you can look at the company's complaint index, which is a measure of its customer service. You can find out an insurance company's financial rating and complaint index by calling the TDI Help Line or using the "Look up a company" feature on their website.

Remember, when it comes to auto insurance, a good price is only a bargain if it comes with good service. Taking the time to research and verify the licensing and reputation of the company you are considering will help ensure that you get the coverage you need at a price that fits your budget.

Frequently asked questions