Your car insurance policy is there for a good reason. And it's not just to pay for crash injuries, stolen vehicles, or repair car damage. More than monetary benefits, it's there to make sure that you, and the people affected, get your lives back to normal as soon as possible. Often, injuries caused by vehicular accidents not only cause minor to major inconveniences to your physical, mental, and emotional health, but they can also affect your livelihood as well. Having the right car insurance will help you get back on your feet so you can enjoy your life (and your work) once again.

Unfortunately, some drivers opt out from getting car insurance due to high costs. But here's the good news: there is a way to enjoy its many benefits without running all of your savings dry. Some tips for cutting insurance fee for cars include the following:

1. Research available car insurance policies and compare prices.

Get three or more price quotes from different insurance companies and see where you can save more. Make sure that you give only complete and exact information, because your premium rates will be calculated based on what you give.

You can ask yourself the following questions:

  • Is the insurance coverage you plan to get based on a fair market value?

  • Would it be possible for you to buy a smaller coverage to lower your premium? Before you decide on this, keep in mind that it's not always beneficial to lower your coverage far below the market value. What you give is what you get, so in this case, the maximum limit that you can get in case your vehicle gets damaged is also low. If that’s the case, then your car insurance is almost as good as useless.

  • Check for the coverage term. Is it for a year, or more than a year--or shorter than a year? There are specific tariff rates issued by the Philippines Insurance Rating Association (PIRA), and all insurance companies use it when setting rates for private and commercial cars. Some companies, despite being financially stable, will offer extremely low rates for longer coverage terms just to snag more policy holders. They shouldn't set way below the standard tariff rates given by the Insurance Commission, or else they risk getting slapped with penalties and fines for violating the law.

2. Buy cars that cost less.

Another way to cut car insurance rates is to buy a more reasonably-priced car (such as a regular sedan) instead of a premium, top-of-the-line performance or luxury car. Why? Simply because the more expensive ones have advanced engines and complex technologies that make their maintenance costs far more expensive than SUVs, four-wheeled drive, sedans, or even diesel-powered vehicles. For example, European luxury vehicles like the Audi and Porsche have expensive, hard-to-find parts, so drivers may sometimes need to import them from other countries. Compare this with, for example, a Toyota or Nissan, where it's easy to find available parts in the Philippines.

3. Buy vehicles that have lower casualty risks.

Many insurance companies charge more for vehicles that tend to cause more casualties or damages. For instance, drivers of sports vehicles often like to test their car’s speed limits, making vehicle crashes all the more probable. Insurance companies see that as red flag (and an added liability in the future).

4. Purchase local vehicles whenever possible.

Certain imported car models have higher premium rates because 1) they come from another country; 2) they’re often one-of-a-kind vehicles that make them attractive to a select group of buyers. Many insurers refuse to even cover these kinds of vehicles. Not only does it take a longer time to process claims that involve imported parts from other countries, but they are also are attractive to car thefts who are on the hunt to sell rare and unique goods in the black market.

5. Choose brand new cars instead of used cars.

You can save money on your car insurance by buying brand new cars, since they have lower premium rates compared with older vehicles. Older cars require more premiums because their depreciation rates (and maintenance costs) are higher.

6. Limit the coverage.

We don't really recommend this, but when you’re really strapped for cash and in desperate need to cut your insurance rates, then you can just opt for the basic Compulsory Third-Party Liability Insurance Policy that's mandated by the LTO. This coverage, which mandates all car drivers to get a minimum of P100,000 to cover death and bodily injury of third parties, is the most basic and the least expensive.

Despite this, we still think it's important to extend your coverage a bit, just to make sure that you and your vehicle is securely protected. At the end of the day, it’s still a good investment to get a comprehensive coverage if you can afford it.

7. Maintain a good driving history.

There is a benefit to having a spotless driving record. For starters, you are automatically given discounts on car insurance rates. Insurers often look at your driving record and claims history when determining your risk level, so all your years of being careful on the road will really pay off here.

8. Make annual instead of monthly payments.

There are some insurers that charge additional fees for those who choose to pay their premiums on a monthly basis. If you pay your premium in yearly lump sum, then you may lessen your average car insurance cost significantly.

9. Add safety equipment to your car.

Lastly, you can cut your insurance rates by being safe. Vehicles with added safety features such as anti-theft devices and driver alarms are often given reasonable discounts by car insurers, so keep this in mind the next time you want to know how to get cheaper car insurance in the Philippines.