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Car insurance rates are on the rise, but there are still several ways to lower your car insurance costs. Shopping around to compare quotes and bundling your insurance policies with the same company are two ways you could save big.
In this article, you’ll find 11 expert tips that can help you get the cheapest auto insurance possible.
- Comparing car insurance quotes is one of the easiest ways to save the most on auto insurance.
- Understanding your policy helps ensure you’re not paying for coverage you don’t need.
- You can use discounts and money-saving strategies together to help you get the cheapest car insurance rates available.
11 Ways to Get the Cheapest Car Insurance Rates Possible
Everything seems to be getting more expensive these days, and you’re probably feeling the squeeze in all areas of your budget, from food to housing and everything in between. Unfortunately, car insurance costs are no exception.
Auto insurance rates have grown by an average of 19% in the last year, according to the most recent Consumer Price Index report from the Bureau of Labor Statistics. But the good news is there are still ways to get lower premiums without sacrificing coverage.
Here are 11 money-saving strategies to help you get cheaper car insurance.
- Shop around and compare quotes
- Don’t assume one insurer is the cheapest
- Explore available discounts
- Bundle your insurance policies
- Let your insurance company track your driving
- Re-evaluate your coverage needs
- Don’t forget about smaller insurers
- Practice safer driving habits
- Consider pay-as-you-go insurance
- Increase your deductibles
- Work on your credit
1. Shop around and compare quotes
The best way to get cheap car insurance is by shopping around and comparing quotes from at least three different insurance companies. By comparing the same coverage types, deductibles, and limits from different companies, you can be sure you’re getting the best value for your coverage needs.
It’s a good idea to compare car insurance quotes each time your policy renews — usually every six months. If you don’t want to enter all your personal information into each company’s website, an insurance-comparison site is a faster and easier option.
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2. Don’t assume any one insurer is the cheapest
Just because a company says it’s the cheapest doesn’t mean it really is. Car insurance companies’ advertised savings and average rates aren’t the best indicator of how much you’ll pay for auto insurance. You might end up paying less, but you could also spend a lot more.
Various factors influence your auto insurance rates. Many are personal, like your driving record, claims history, and credit score. And if you’re a high-risk driver, for example, “non-standard” insurance companies — such as The General or SafeAuto — could offer lower rates than major insurers.
3. Explore available discounts
Many drivers don’t take advantage of all the car insurance discounts they’re eligible for. Most insurers offer more than a dozen discounts for drivers — some you may not even be aware are available.
And the best part is that discounts can be stacked together, maximizing your savings potential.
Here are some common auto insurance discounts you might not be aware of:
- New car discount
- Alternative energy discount for electric, hybrid, and alternative fuel vehicles
- Military member and veteran discount
- Teacher discount
- Federal employee discount
- Early shopper discount
- Pay-in-full discount
- Low mileage discount
- Defensive driving course discount
4. Bundle your insurance policies
Bundling your insurance policies with the same company is typically the largest single discount available. Although the home and auto multi-policy discount is the most common, some insurers allow you to bundle car insurance with boat, RV, motorcycle, or life insurance.
The amount you can save with a bundling discount depends on the insurance company, policy types, and your state. Here are a few examples of how much you could save by bundling your insurance policies together:
|Amica||Up to 30%|
|Erie||Up to 25%|
|American Family||Up to 23%|
|Nationwide||Up to 20%|
|State Farm||Up to 17%|
5. Let your insurance company track your driving
Another way to get lower car insurance rates is to allow your insurance company to track your driving habits. A usage-based insurance program tracks factors like the number of miles and time of day you drive, fast acceleration, hard braking, and smartphone usage.
Some insurers offer a participation discount and additional savings after you complete the program. A few programs to consider are:
Not everyone benefits from the program, though. If you drive late at night or a lot of miles, you might not get any savings and could even see your rates increase with some companies, like Progressive.
Pay-per-mile insurance is another option. You pay a base monthly rate and a per-mile rate for every mile you drive. This could be a great option if you work from home or have a short commute. Mile Auto and Metromile are two of the leading pay-per-mile insurers.
6. Re-evaluate your coverage needs
The types of coverage and amount you buy affect your auto insurance costs. Having the proper coverage amounts can help ensure you’re adequately protected without paying too much for insurance.
For example, you may have higher limits than you need or an older car that no longer requires comprehensive and collision insurance.
Re-evaluate your coverage needs at each renewal or when you have a major life event, like getting married or divorced, adding a young driver, or having a driver move out. Speaking with your insurance agent at these times can help ensure you’re only paying for what you need, saving you money on unnecessary coverage.
7. Don’t forget about smaller insurers
Although you’re probably familiar with the big-name insurance companies that spend money on advertisements, hundreds of small insurance companies exist.
Regional insurers are only available in select states, but they often offer personalized customer service and lower rates than larger companies.
These companies may be worth checking out if they’re available in your state:
- Erie offers some of the cheapest rates in Virginia and has excellent customer satisfaction scores in the Mid-Atlantic and North Central regions.
- NJM offers outstanding customer service in New Jersey.
- Wawanesa is only available in Oregon and California but earns the top spot for customer satisfaction, according to J.D. Power.
8. Practice safer driving habits
Your driving history plays a significant role in your insurance premiums. Being a safe driver can also help you get cheap car insurance.
In fact, Compare.com data shows rates increase by around 37% with a ticket, 44% after an at-fault accident, and 94% after a DUI conviction. These infractions can stay on your record for three or more years, causing higher premiums for years to come.
A clean driving record comes from safe driving habits and avoiding tickets and accidents. With a clean record, you could also be eligible for accident forgiveness, which prevents a surcharge if you do cause an accident down the road.
9. Consider pay-as-you-go insurance
If you don’t drive often or only need insurance coverage temporarily, pay-as-you-go insurance may be a good match. It’s only available from a few insurance companies, like Hugo.
With Hugo’s Flex Plan, you can purchase liability-only car insurance for as little as three days at a time. You can turn the coverage on and off and only pay for the “on” days.
The company also offers select full-coverage options. Hugo could be a great solution if you don’t want to take public transportation or plan to borrow someone else’s car for the day to run errands.
10. Increase your deductibles
When you purchase coverages like collision and comprehensive, you can choose your car insurance deductible. The deductible is the amount you pay after filing a claim before the insurance company pays its share.
The higher the deductible, the more you can save on your car insurance premium. But a higher deductible means you’re paying more out of pocket after an insurance claim, so make sure you can afford it before making the change.
11. Work on your credit
Insurers can use your credit history when determining the cost of your car insurance. Credit-based insurance scores focus mainly on your payment history and how well you manage your bills.
So, if you have bad credit, you might be paying more for auto insurance. Focusing on paying your bills on time and managing your finances more efficiently can help improve your insurance score.
Although you won’t see immediate savings, it can help you save later. For instance, drivers with excellent credit scores pay around 25% less than drivers with an average score.
FAQs About Getting Cheaper Insurance
We’ve provided multiple ways to get affordable car insurance. Now, we’ll answer some common questions that might help you save even more.
What makes car insurance so expensive?
Many factors make car insurance expensive. Your driving record, the type of vehicle you drive, and where you live are a few of the most common. Shopping around for quotes, keeping a clean driving record, and taking advantage of discounts are a few ways to combat high auto insurance premiums.
How can you make car insurance cheaper?
Avoiding tickets and accidents, allowing the insurance company to track your driving habits, and bundling your auto with homeowners insurance are a few ways to get cheap insurance. If you’re in the market for a new vehicle, avoid sports cars and opt for something with safety features and an anti-theft device instead.
Can you ask your insurance company to lower your price?
You can ask, but that doesn’t guarantee that your auto insurance company will lower your price. However, asking might reveal that you’re paying for coverage you don’t need or are missing a discount you’re eligible for. Your insurance agent can review your policy to see if you’re getting the best deal.
What company is known for the cheapest car insurance?
If you’re looking for cheap auto insurance, consider State Farm, GEICO, Progressive, Travelers, or Allstate. We found that these cheap car insurance companies offer some of the lowest rates, with many available discounts to help you save even more.
- Bureau of Labor Statistics, “Table 1. Consumer Price Index for All Urban Consumers (CPI-U): U. S. city average, by expenditure category,” accessed November 12, 2023.
- J.D. Power, “2023 U.S. Auto Insurance Study,” accessed November 12, 2023.
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