Since auto insurance is mandatory in the US, it's an unavoidable cost for those of us who own automobiles. Few of us really look to see what we're buying -- after all, the insurance company knows what we need, right? Well, yes, they do. Unfortunately for us, auto insurance agents are also salespeople who have a commodity to sell. If we swallow their line without thinking, we can be hooked into an auto insurance policy that's beyond our needs.

Choose the highest deductible you can afford

The deductible is the amount you'll be liable for in case of an accident, so if you can keep $500 in an easily accessible savings account, or you can easily afford to pay that out of your daily funds, then you should have at least that high of a deductible amount. If you can afford a higher one, it will save you even more money by lowering your premiums.

Take advantage of all discounts

Anti-theft devices, good driving record, defensive driving courses - they will all make a difference. Ask your insurance agent what's available to you as some states and insurance companies allow various other discounts.

The kind of vehicle you drive makes a difference

Sports cars are in more accidents than family autos. Red automobiles are in more accidents than white ones. Your state has a list of which autos are stolen more frequently. All of these factors make a difference in the premium your insurance company charges you.

Don't buy more insurance than you need

Each state has limits to how little you need, so find out what your state requires. Decide before you see your agent if you need to buy more than your state requires. Remember that your auto insurance agent has a job - to sell you insurance. It's up to you to decide how much you need and want.

Don't double your coverage of things like medical care

If you're already insured by hospitalization or other insurance, you don't need that coverage on your auto insurance. Check all of your policies against each other to make sure you're not paying unnecessarily for an overlap.

Shop around for insurance just as if you were shopping for anything else

There's a great variety of prices, plans and companies. Do your homework before you even start looking for auto insurance. While it can be confusing, if you go with a list of your needs in hand and resist extras and salesman's pressure, you can buy auto insurance confidently.

Remember: Insurance companies are in business to make money, like any other business. Regardless of how many warm and loving advertisements they pay someone to create for them, they are only a business and their care ends with your dollar. Don't let false loyalties dictate your insurance costs.

External Links:

• Insure.com - Minimum levels of required auto insurance