CarInsurance.com Insights
- By paying upfront for a six-month or annual policy, you can save an average of 9% on your insurance bill.
- If you decide to bundle your home/renters policy with auto insurance, you can lower your rates by 13%.
- Another easy way to reduce auto insurance costs is to choose a higher deductible. By increasing your deductible from $250 to $500, you can save $282 a year on premiums.
Let’s be honest, paying for car insurance isn’t anyone’s favorite part of owning a car. But it’s one of those must-haves you simply can’t skip.
Our editors have developed a checklist with practical, real-world tips to help you navigate the rising insurance costs and cut your premiums.
13 strategies to lower your car insurance rates
Getting cheaper car insurance requires some legwork, but the potential savings could make it worthwhile. Learn the best ways to save on car insurance — from shopping around to asking about discounts.
- Compare multiple quotes
- Bundle home and auto policies
- Increase your deductible
- Maintain a clean driving record
- Compare insurance rates before you buy a vehicle
- Take advantage of a paid-in-full discount
- Ask about a multi-policy discount
- See if you qualify for a low-mileage discount
- Telematics and usage-based policies
- Adjust your coverage levels
- Install anti-theft devices
- Go paperless
- Reassess your policy after major life changes
Let’s take a closer look at how these strategies can make a real difference in how much you pay for insurance:
1) Compare multiple quotes
The best place to start is by determining where you can get the cheapest car insurance. Comparison shopping and gathering quotes from several insurers is the top way to save.
You may already have a pretty good deal with your current insurer, but the only way to know is by comparing regularly.
“Comparing car insurance prices before each renewal will show you which insurer is willing to offer you the best rate,” says Fran Majidi, an insurance expert at Modotech, an insurance software company.
Majidi explains that high-risk drivers with a history of accidents, license suspension, insurance lapses and DUIs should get quotes from insurers that specialize in non-standard insurance.
“If you’re a high-risk driver, specialty insurers may offer you better rates than a traditional car insurance company,” she says.
2) Bundle home and auto policies
One of the best strategies for lowering your rates is to look for insurers who offer discounts for bundling policies, such as auto and home or renters and car insurance.
For example, purchasing homeowners insurance from the same company that provides your car insurance can earn you a discount. In some instances, multi-policy discounts can be more than 9%.
National averages for multi-policy discounts are:
- 13% for auto and homeowners insurance
- 12% for auto and condo insurance
- 6% for auto and renters
- 4% for auto and life
But you don’t always save by bundling. It’s essential to compare what it would cost to purchase your policies separately to the price break you get on a bundle. It’s possible, for example, that you would do better to buy a home policy on its own and get your auto coverage from a company that offers one of the cheapest rates.
3) Increase your deductible
Raising your collision and comprehensive deductibles from $250 to $500 can significantly impact rates. Nationwide, for example, says you might save 15% to 30%. Increase your deductibles to $1,000; the savings could be as high as 40%.
Remember that a higher deductible means you’ll pay more out of pocket if you get in an accident and need to repair your vehicle. An expensive repair bill could easily surpass any savings you made on the front end.
Real-world savings examples
The amount you can save on car insurance depends on factors such as your insurance company and the specific discount you qualify for. Your deductible amount also plays a role in determining your insurance rates. For instance, if you increase your deductible from $250 to $500, you can save an average of $282 a year on your premiums.
The table below will give you an idea of how much you could save by raising your deductible from $250 to $500.
| Full coverage car insurance cost with $250 deductible | $2,795 |
| Full coverage car insurance cost with a $500 deductible | $2,513 |
| $ Savings | $282 |
Here’s an example of how much your premium might decrease if you raise your deductible from $250 to $1,000.
| Full coverage car insurance cost with $250 deductible | $2,795 |
| Full coverage car insurance cost with a $1,000 deductible | $2,210 |
| $ Savings | $585 |
4) Maintain a clean driving record
You can take steps to avoid expensive tickets and accident claims. Pay attention to your speed, don’t try to run a red light, be cautious and drive defensively.
Poor driving history can disqualify you from getting the cheapest car insurance. Insurers will check your record to see if you present a high risk level. Speeding tickets, accidents and citations for driving under the influence can increase your insurance rates.
As we pointed out earlier, good driver discounts can save you up to 17%. In addition, insurance companies usually require that you have a clean driving record for at least three years. That means no DUIs, no moving violations and no at-fault collisions.
Drive sensibly and cautiously, and you’ll get cheap car insurance by avoiding surcharges and receiving a good driver discount.
5) Compare insurance rates before you buy a vehicle
Make sure to consider the insurance cost when shopping for a new ride. Cars that cost less to repair or replace generally have more affordable rates.
Don’t think that the “cheaper the car, the cheaper the insurance.” It doesn’t always work that way. Instead, compare car insurance rates by vehicle when shopping for a car.
Instead, consider purchasing a car that’s cheaper to insure. Insurance rates depend on your vehicle’s make and model – small SUVs with safety features are cheaper to insure than luxury cars or sports cars, for example.
Below is a list of the top 10 cheapest cars to insure.
| Make & model | Average six-month rates | Average monthly cost |
|---|---|---|
| Honda CR-V | $966 | $161 |
| Honda HR-V | $968 | $161 |
| Volkswagen Tiguan | $990 | $165 |
| Hyundai Venue | $1,000 | $167 |
| Chevrolet TrailBlazer | $1,006 | $168 |
| Subaru Forester | $1,007 | $168 |
| Mazda CX-5 | $1,010 | $168 |
| Chevrolet Express | $1,018 | $170 |
| Subaru Outback | $1,021 | $170 |
| Hyundai Kona | $1,024 | $171 |
6) Save 9% by paying in full instead of monthly
Depending on your car insurance company, your policy will be valid for six months or one year. You can pay your premium upfront in full or in monthly installments.
Drivers will save an average of 9% by paying upfront for a six-month or annual policy. A paid-in-full discount nets a savings of $230 per year on a full coverage policy. Drivers with this discount will spend $2,283 annually on car insurance vs. $2,513 without the discount. If you want the discount, consider saving a monthly amount to pay your next premium in full.
Wise words
If you want to take advantage of discounts, pay attention to the savings potential that different insurers offer. For example, Progressive’s good student discount starts at 5%, whereas GEICO’s smart student discount is 15%. If you want to insure multiple vehicles, Progressive offers an average discount of 12%, and GEICO offers savings of up to 25%.
7) A multi-policy discount can save you 9%
Insurers typically offer a range of additional discounts based on factors such as driving habits and academic performance. When you purchase two or more policies from the same company, you can save as much as 9%.
8) Low-mileage discounts: Save 9% on your premiums
If you’re an infrequent driver, you might qualify for a low-mileage discount. Drivers who log less than 7,500 annual mileage net an average 9% discount, while drivers with annual mileage of 10,000-11,999 garner a 7% discount.
9) Telematics and usage-based policy can help you get a 10% discount
A telematics program is a car insurance option that uses technology to monitor your driving habits.
Typically, it involves installing a small device in your vehicle or using a mobile app to track behaviors like speed, braking, mileage, phone usage and time of day. Insurers use this data to assess your risk level, and you may receive discounts or personalized rates based on how safely you drive.
If you sign up for a telematics program with your insurance company, you can save 10% on your policy.
You can also consider a pay-per-mile insurance policy, which allows you to pay based on the actual miles you drive, rather than just giving a discount for driving less.
Take advantage of all available car insurance discounts to receive additional reductions.
10) Adjust your coverage levels
Adjusting your coverage levels can reduce your premium. However, it’s essential to make sure that you’re not underinsured.
“Lowering your coverage limits will lower your auto insurance premium. However, keep in mind that setting your liability limits too low may expose you to major financial risks if you cause an accident,” Majidi says.
The amount of car insurance you need depends on many factors, but most states require a minimum amount of liability coverage. This is the cheapest car insurance you can legally use to operate a vehicle within your state.
However, most drivers can benefit from having full coverage and higher liability limits. Full coverage comprises liability, collision and comprehensive insurance and is especially important if you lease or finance your car or own a newer vehicle.
You can get cheaper car insurance by dropping comprehensive and collision coverage if you have an older vehicle. But don’t drop that coverage without giving it some thought. Many experts say it’s time to drop these coverages when the actual cash value you’d receive for your vehicle doesn’t justify the insurance expense.
If you’re trying to save money, you might also consider dropping optional endorsements, such as rental car reimbursement or roadside assistance.
11) Go paperless and get a discount of 3%
Choosing to go paperless is another easy way to save on car insurance. When you agree to get your bills, policy documents, and updates by email instead of regular mail, most insurers give you a 3% discount. It helps the company reduce printing and mailing costs, and it’s also better for the environment.
12) Install anti-theft devices
Installing anti-theft devices can help lower your car insurance because they reduce the risk of your vehicle being stolen or vandalized. Insurers see it as a sign you’re taking steps to protect your car, which can lead to a small discount of 2%
13) Reassess policy after significant life changes
Getting married, moving to a new ZIP code, changing jobs or even changing where you park your car—all affect how your insurer calculates risk. For example, married drivers or those who move to safer neighborhoods often qualify for lower premiums or discounts.
That’s why updating your policy is smart whenever something significant changes. Let your insurer know as soon as possible, as this could help you save on your next renewal.
Can my job or profession qualify me for lower insurance rates?
Your job can save you money — firefighters and scientists earn the steepest professional discount of 12 %, saving up to $300 annually on a full coverage insurance policy. Below, see other professions and the average discounts you can receive.
Select your profession to see insurance discounts, and click on the numbers in the "State Availability" column to see the list of states where the companies offer discounts.
Speak with a friendly agent and get your quote in minutes!
Car insurance savings tips by driver profile
While there are some tried-and-true methods of saving money on car insurance, the best ways to save sometimes depend on your age and driver profile.
Here are some tips for saving money on car insurance based on your situation:
- New/teen drivers: Teen drivers typically get the cheapest car insurance when insured on a parent’s policy. Young drivers can also take advantage of smart student discounts and away-at-school discounts. Some insurers offer savings for completing a driver safety course.
- Seniors: Seniors who drive less may qualify for low-mileage car insurance discounts, which can significantly reduce their premiums. If you drive an older vehicle, you can also drop collision and comprehensive insurance, which lowers your premium.
- Commuters vs. low-mileage drivers: Your driving amount can impact your car insurance premium. Occasional drivers who don’t commute regularly should look into a pay-per-mile policy, which charges a premium based on a flat monthly rate and a small fee for each mile driven. Commuters might find savings through bundling policies or taking a defensive driving course.
- Urban vs. rural drivers: Drivers in urban areas often pay more for car insurance than those in rural areas. If you live in a city, consider insuring a vehicle with safety features, like an anti-theft device, or keeping your car in a covered garage, which could help you save.
Saving on car insurance isn’t just about price — choose the right coverage for real protection.
Common mistakes to avoid when shopping for car insurance
Here are some common mistakes that many drivers make when trying to save money, and how you can avoid them:
- Underinsuring to save money: A significant mistake drivers make when searching for cheap car insurance is choosing a state minimum coverage policy. Even though it’s the most affordable coverage you can legally have, it provides very limited financial protection. In most cases, it’s smarter to spend more to get a full coverage policy, which will cover your own losses if you get into an accident.
- Not comparing quotes annually: It’s a good idea to compare car insurance quotes at least once per year, or after a significant event, like moving, getting married, filing a claim or adding a teen driver to your policy. You might find that a different insurance company can offer you a better deal for your current situation and coverage needs.
- Forgetting to ask about discounts: Almost all car insurance companies offer discounts, and that can go a long way in helping to reduce your premium. Choose a car insurance company that offers multiple discounts for which you can qualify. That way, you can maximize your savings.
- Letting your policy lapse: Letting your policy lapse is a big mistake that drivers make when they can’t afford their car insurance premiums. When your policy lapses, your coverage terminates and goes on your personal insurance record. When you go to purchase insurance again in the future, you will likely pay a much higher rate than you did before.
Frequently Asked Questions: How to save
How can I get cheaper car insurance?
There are several ways to get cheaper car insurance. You can bundle your policies, look for discounts, take a defensive driving course, pay your annual premium in full and get new quotes.
Which discounts do insurers offer?
Each insurer offers different discounts. Some of the most common include good student discounts, new car discounts, safe driver discounts, claim-free discounts, paid-in-full discounts and policy bundling discounts.
Is it safe to increase my deductible?
It’s safe to increase your deductible if you can afford the higher amount in case of a claim. You should avoid raising your deductible to a limit that you couldn’t comfortably pay out of pocket if you had a loss.
Does my credit score affect my rates?
Yes, in most states, insurance companies can use your credit score to calculate your car insurance premium. Generally, drivers with excellent credit pay the lowest rates, while those with poor credit pay higher rates.
How often should I shop for new quotes?
It is recommended that you shop for new car insurance quotes at least once a year. However, it can also be beneficial to get new quotes after a big event or life change, like moving to a new city, getting married, buying a new car or adding a teen to your policy.
Resources & Methodology
Methodology
CarInsurance.com commissioned Quadrant Information Services to get car insurance rates. The rates are based on sample profiles of 40-year-old male and female drivers carrying full coverage policies with limits of $ 100,000/$300,000/$100,000 and $500 collision and comprehensive deductibles. Read the detailed methodology for more information.
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