How to Lower Your Car Insurance
Car insurance is a significant monthly expense, and most drivers are overpaying. The average American spends over $1,800 per year on auto insurance, but there are many proven ways to reduce that number.
Shop Around Every Year
This is the single most effective strategy. Rates vary wildly — the same driver can see quotes from $100 to $300/month. Get at least 3-5 quotes annually from:
- Major national insurers (GEICO, Progressive, State Farm)
- Regional companies (often cheaper for good drivers)
- Online comparison tools (The Zebra, Policygenius, Jerry)
- Your local credit union
Increase Your Deductible
Raising your deductible from $500 to $1,000 can reduce your premium by 15-30%. Just make sure you have enough savings to cover the higher deductible.
Bundle Your Policies
Multi-policy discounts for bundling auto with home or renters insurance typically save 5-25%.
Ask About All Available Discounts
- Safe driver — no accidents or tickets for 3-5 years
- Low mileage — driving under 7,500-10,000 miles/year
- Good student — B average or better
- Defensive driving course — 5-10% off
- Pay-in-full — paying annually saves 5-15%
- Paperless and autopay — small but easy savings
- Professional associations — some groups negotiate group rates
Improve Your Credit Score
In most states, credit significantly affects your premium. Drivers with excellent credit pay 40-60% less than those with poor credit.
Review Your Coverage
- Old cars: If your car is worth less than $5,000, collision and comprehensive premiums may exceed potential claim payouts
- Rental car coverage: Unnecessary if you have a second car or credit card coverage
- Roadside assistance: Often duplicated by AAA or manufacturer programs
Drive Less, Pay Less
Usage-based and pay-per-mile programs reward safe, low-mileage driving. If you work from home, make sure your insurer knows — mileage is a major rating factor.
Maintain a Clean Driving Record
A single at-fault accident can raise premiums 40-50%. A DUI can double or triple them. Drive carefully and your rates will reflect it.
The Bottom Line
Most drivers can save $300-$800 per year by shopping around, adjusting coverage, and taking advantage of discounts. Set a calendar reminder to compare quotes every 12 months.
