Get Cheaper Car Insurance by Paying Premiums Electronically
An electronic funds transfer (EFT) lets insurance companies withdraw their monthly premium from your checking or savings account or your credit card. Once you authorize this systematic payment option, you can forget about payment reminders and late fees. Plus, you can a discount. In fact, using savings or checking account option is better than that of a credit card, since with the former you can just set it and forget about it, while with the latter you need to constantly update it.
After full payment, EFTs are the most preferred mode of payment for insurance companies as they know exactly when they will get paid. Remember to enquire beforehand if your provider accepts withdrawal of funds from your bank account, as some companies only accept checking accounts as the mode of payment.
Once you opt for EFTs, you should firstly maintain sufficient funds in your account at all times so that your provider can withdraw funds on the stipulated date. You should also inform your insurance provider if you switch your bank accounts. If your provider is unable to withdraw funds for any reason, they may impose the same penalties as for a bounced check. If your payment bounces multiple times, your company will not renew your policy.
If you switch your insurance company, it usually takes some time for your old company to stop withdrawal from your account. You should specifically request your old provider to remove your EFT. If you forget to apply for removal have your bank account padded for at least one extra withdrawal. You will be refunded the amount once your cancellation is processed.
Although EFT comes with its share of dos and don’ts, the mode of payment is worth the work because it saves you from late payment charges and earns you discounts.
Find a comprehensive analysis of all the ways to you can save on your car insurance, here.
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