Insurance 101 (cont.)

Before You Buy

Choose your next ride carefully. Some vehicles have more costly claims records and are also favorites of thieves. Thus, they are more expensive to cover. Insurers are also wary of vehicles with powerful engines that could get unskilled drivers into trouble.

Be aware that many insurers are now reviewing credit ratings of applicants. Insurance companies believe that a poor credit history may be an even better predictor of future losses than an applicant's driving record. Consequently, insurers are rejecting applicants with bad credit ratings. Remember, however, that if you're denied coverage, you have the right to ask why.

Some insurers will offer discounts that can reduce your total insurance premium by 5 to 40 percent, but you must be proactive to get the best rates. Always ask your insurer about the following discounts if you think they might apply to you:

Low annual mileage or restricted mileage.
Airbags and anti-lock brakes.
Good driver discounts for no accidents or moving violations in the past three years.
Multi-vehicle or multi-policy discounts for insuring more than one vehicle with the same company or signing up for vehicle, life, home owners or other policies with the same company.
Completion of driver training courses.
Antitheft devices, such as ignition or fuel shut-off devices or alarm systems.
Nonsmoker discounts.
Drivers between the ages of 55 and 65.
Car-pooling to work.
Secure garage parking.
Good grades for students.