Over the weekend, the Detroit News had an article that I think is quite alarming: Motorists are electing to drop their auto insurance because they can no longer afford it.  To me, that’s just scary and for a variety of reasons:

1. In an accident, if a motorist is uninsured and the cause of the accident is found to be the fault of the uninsured motorist, there’s the potential to be sued for hundreds of thousands of dollars for injuries and damage to vehicles and property.

2. It is illegal to drive a vehicle without insurance in 48 states (excluding Wisconsin and New Hampshire), which means if you get pulled over for even the slightest infraction, you’re going to get a hefty ticket for not having any insurance.

At least twenty states require drivers to carry uninsured vehicle insurance, so in the event you are hit by an uninsured or under-insured motorist, the coverage compensates for injuries and damages.  According to State Farm and Allstate, this adds approximately 7 to 9 percent to an average auto premium.

The article in the Detroit News reports that several hundred thousand drivers have canceled their auto insurance in the past year due to lack of employment.  It notes that insurance companies such as Insurance.com has also been witness to a drop in more uninsured motorists, citing that at least 40 percent of callers following up on online applications had let their previous policies lapse, up from less than 10 percent a few year ago.

Christine Williams, who is a licensed agent for Insurance.com, agrees:

I am seeing a lot more canceled policies than ever, especially in the last couple of months, usually due to job loss.

I simply can’t imagine driving without auto insurance, even the mere thought of it scares me to death.  While I understand not being able to afford insurance due to job loss or the crumbling economy, by driving without insurance, motorists are putting themselves and others at an enormous risk.   While uninsured drivers may believe they are saving money by not having to pay premiums,  it will be quite the opposite when they are involved in a car crash which will no doubt yield hundreds – if not thousands – of dollars in damages with absolutely no way to pay.  Sadly, even if you have insurance and are involved in an accident with an uninsured motorist, you can expect your own rates to go up when you have to file a large claim due to no fault of your own.

Uninsured motorists also risk losing their license to drive – especially if they are involved in an accident.

Below are some tips which may reduce your insurance premiums or help you make timely payments so you don’t become a statistic behind the wheel:

• Consider Higher Deductibles 

This could lower the cost of your collision and comprehensive coverage considerably.

• Assess Current Coverage

Look at coverage you may not need.  If your vehicle is older or has a low market value, perhaps you could drop collision and/or comprehensive coverage completely. On an older model, this kind of coverage may not be worth having. To assess your car’s current value, visit Kelley Blue Book.

• Drive Less, Consider Carpooling or City Transportation

Most insurance companies offer low-mileage discounts.

• Scale Down

If you’re having problems making your insurance payments, consider scaling down; even if you’re insured at the minimum level required by law in your state, at least it’s better than no insurance at all. 

• Ask About Due Dates

If you pay monthly, inquire about changing your payment due date so it fits a little more easily into your monthly budget.

• Ask Questions

Ask your agent questions about anything in your policy that you don’t understand.  If you’re unhappy with your agent, you can always seek out another one who is willing to help you.  The same goes for your insurance company it’s perfectly okay to change your insurance company at any time if you’re not happy with the service you receive or can get the same insurance cheaper somewhere else.  On a personal note, two months ago I changed insurance companies after spending five years with a previous company.  The level of customer service just wasn’t there anymore and it took me what seemed like a lifetime just to speak to an agent over the telephone.  I changed companies and ended up getting a much lower rate in the process.

Can Cars for Girls readers think of other ways to save on auto insurance?

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