Many of the things you do have an effect on your auto insurance premiums, and these things aren’t limited to only what happens on the road. Both on the road and off it, these good habits have direct benefits and also can lead to lower auto insurance premiums.

Drive Defensively

Basic defensive driving, which includes everything from not tailgating to monitoring other vehicles near yours, is the best way to keep yourself and your passengers safe while on the road — and no consideration is more important than personal safety. Because defensive driving habits help avoid accidents, however, they also can help keep your auto insurance premiums low.

When you avoid accidents by driving defensively, you reduce the likelihood of filing a claim. Your auto insurance premiums will remain lower when you avoid filing claims against the policy because previous claims history is one factor that causes rates to go up.

Moreover, the increase in rates is often substantial after a claim. In one study, drivers who filed an auto insurance claim amounting to $2,000 or more saw their premiums increase 44.1 percent on average.

No matter what your premiums are right now, that type of increase would be significant. All you need to do to reduce the chances that your rates jump like this is drive in a way that keeps everyone safe. This isn’t necessarily a foolproof strategy, for you still could be in an unavoidable accident. However, it can greatly reduce the probability of an accident occurring.

Pay Bills on Time

Paying bills on time is the responsible way to handle personal finances, and it has the added bonus of helping you avoid late fees. Even on small bills, late fees can add up to substantial unnecessary costs that eat into your monthly budget (especially if you’re late on more than one bill in a month).

Making on-time payments also has the benefit of helping you maintain a good credit score. Your payment history, which includes bills that are paid late, generally accounts for 35 percent of your credit score. That’s the largest single category that’s used to tabulate your score.

In turn, a good credit score can help you get the lowest available auto insurance premiums. Most states allow insurance companies to consider your credit score when you apply for an auto insurance policy, and low scores are often assessed higher premiums. By maintaining a good score, you won’t be penalized for having bad credit due to missed or late payments.

If you struggle to make payments on-time, there are two steps you can take to improve in this area of personal finance. First, work on saving up a balance in your checking account so that you have enough money in the account to pay your bills without worrying about whether a payment will be declined.

Second, set up payment reminders or automatic payments for all of your regular bills. Ones that can be automated should be taken directly out of your checking account on the due date or shortly before. Any bills that can’t be set to autopay should have a reminder that’ll be pushed to your mobile device or computer a few days before a payment is due.

Take Up Road Biking

One of the healthiest ways to get around town is to bike. Road biking both provides exercise for you and is green for the planet. It’s also a fairly efficient method of going around an urban area.

If you bike instead of drive when going about town, you’ll also reduce how many miles you drive each year. This could lead to an insurance discount, as many insurers offer low-mileage discounts.

If you need help finding low-cost auto insurance, contact Family Insurance Centers.