When A Payday Loan Become A Part Of Your Auto Insurance Bill

Auto insurance can get quite costly. When your monthly premium is due and you don’t have the cash, will you need a payday loan to keep yourself legal to be driving? Depending on which state you live in, the cost of your car insurance can range anywhere from 1%-8% of your median annual household income. That may not even include having a teenage driver on your policy which can be extremely expensive! Other variables that can affect the cost of insurance are: the number of insured drivers on the policy, vehicle-repair costs and the amount of insurance fraud on your policy.

Because auto insurance is not an option, meaning is it state mandated that you have it, it is very important to budget for your premium payment so you don’t take the chance of having your policy cancelled due to non-payment. Taking out a payday loan to cover a months payment is a temporary option but not a solution to budgeting for this cost. To get the most out of your auto insurance while being able to afford the payment, consider the following things before purchasing a new policy or looking for another provider:

1. Shop around. You’d be surprised how much rates can vary from company to company, even for the same exact coverage. A study done by the Consumer Federation of America showed that auto insurance rates can vary from $762 to $3,390 which is for the same person getting the insurance having the same coverage and living in the same city. That’s quite a range. Don’t think that all companies are the same when it comes to cost. Big names may charge more while smaller companies offer better rates.

 2. Verify your mileage rating. Insurance companies take into consideration how much you drive every year. The average is less than 12,000 miles per year. If you drive less than that, make sure your auto-insurance quote is based on how many actual miles you log annually. Don’t let them make assumptions on your behalf. If you have a current policy, can save money by calling your agent to make sure he has the correct number.

3. Ask about discounts. Most companies advertise a good-driver discount if you have a clean record but did you know that some insurers provide driver discounts based on what job or what kind of degree you hold?. Along with that, you can also multiple insurance policies, such as auto and home, or auto and boat. By doing so you can get quite a substantial “loyalty” discount. This too can lower your rate.

With some time, energy and research, you can find an auto insurance policy that suits your needs, is affordable, and will fit into your budget. You may have to cut back in other spending areas to ensure you are able to make your payment every month and in doing so, avoid having to take out a payday loan or cash advance to make sure you are street legal. To take it one step further, set aside money every month in an effort to save for your insurance policy. You always have the option to pay for a full year’s worth of coverage. You can also save money this way because you won’t be charged a convenience fee for setting up a payment plan.