Auto Insurance with Low Down Payments
Even if you purchased the most affordable car insurance on the market, insurance providers still require a larger sum up front. Luckily, if you’re in the market for new car insurance that can offer a cheap down payment, there are options available.
Providing a down payment for anything is not ideal; however, it is important to note that no company will insure you without some kind of upfront payment. Sometimes the first monthly installment will act as a down payment, while other times it can take the form of a more traditional down payment.
These are two ways policyholders can choose to pay their premiums:
- Pay Upfront: You can pay the full insurance premium in total, which often yields a discount for paying in advance.
- Pay Monthly: Paying the premium in monthly installments is the most popular choice for drivers on a budget.
Whether you pay for an insurance policy in full or pay for it through monthly payments is a personal decision best ruled by your own financial means and abilities. Paying the policy at once may save money in the long run, but monthly payments are often the best option for drivers’ finances.
While paying monthly is more budget-friendly, keep in mind that opting to pay a monthly car insurance premium will still cost you in the form of an initial down payment.
Virtually every car insurance company requires you pay at least one month ahead on any car insurance policy. Remember: a down payment generally is not an additional premium but built into your rate. This means whatever you pay as a down payment is deducted from future payments.
In most cases, you can count on additional savings when you pay your policy in full. Some insurance car companies will charge you a monthly installment fee to cover the cost of processing your monthly payment; this is pretty common practice in the insurance industry, so don't be alarmed if you see this fee on your monthly bill.
Illinois Vehicle Auto Insurance provides car insurance with cheap down payments and different coverage options for all of our customers. We take pride in providing transparency on all our insurance fees.
What Coverage Do You Need?
When shopping for car insurance with a cheap down payment, you first have to decide if you want a basic liability-only insurance policy or a full coverage insurance policy. Full coverage insurance is optional. Liability insurance, on the other hand, is mandatory in 49 states in the U.S — with the exception of New Hampshire, where liability insurance is optional.
- Liability Insurance: This type of insurance covers other individuals and their vehicles if an accident is your fault. You and your vehicle are not covered, but passengers in your vehicle are covered.
- Full Coverage Insurance: Full coverage includes a comprehensive or “collision” package. Collision protects your vehicle if it is damaged in an accident. Comprehensive provides protection if your vehicle is damaged by something other than a collision, such as your car being stolen or a light pole falling on your car when it’s parked.
Liability insurance will not cover damages to you or your car in the event of an accident. Only collision coverage covers your damages, which is included in all full coverage policies.
Keep in mind a full coverage policy will typically increase the cost of your monthly premium; however, if you feel full coverage is your best option, then we suggest you get the coverage that best suits your insurance needs.
Evaluate your insurance coverage as your car ages. As time passes, you might find you are paying for insurance coverage that your vehicle’s age and value doesn’t merit.
A general rule of thumb for car insurance: if your vehicle is worth less than $4,000 you probably don’t need collision and comprehensive insurance coverage.
Collision and comprehensive coverages, also known as physical coverage, are designed to protect your vehicle. But if your vehicle isn’t worth much money, you might be paying for extraneous insurance coverage.
3 Tips to Lower Your Monthly Premium
In addition to choosing an auto insurance company that offers a low down payment, there are other ways to save on your policy. Below are three ways to lower your monthly premium and make your car insurance more affordable.
1. Shop Insurance Before Buying a Car
If you are in the market for a new car, make sure you shop for car insurance before purchasing a car and driving off the lot. Why is this important? You need to make sure you are able to afford your monthly insurance premium on a new shiny ride.
2. Raise Your Deductible
If you are a driver with a history of little or no accidents you can consider raising your deductible for a lower premium, which can help you save hundreds of dollars in the long run.
For example, if you choose to increase your deductible to $1,000, doing so would reduce your monthly payments.
3. Shop Around
When it comes to your insurance renewal take the time to research other car insurance companies. Shop around and get quotes from different insurance companies — you will be surprised how many carriers can offer you cheap down payment options.
If you are still searching for an auto insurance company that offers cheap down payments, see how much you can save by simply switching to a new provider, like Illinois Vehicle Auto Insurance.
Discover the savings and get a free car insurance quote from Illinois Vehicle.