How to get cheap car insurance in 10 easy steps
Getting a great deal on car insurance doesn’t have to be complicated. In fact, if you follow a few basic steps, you’ll find a policy that meets your needs and your budget.
There are many easy ways to save: shop around, ask about discounts, bundle, or try a usage-based insurance program. You can even combine several of these options for the most affordable auto insurance and save up to 30%.
Keep reading for the top ten tips that can lower your car insurance bill.
how to get cheap car insurance
Getting cheap car insurance takes a bit of effort on your part, but it’s worth it. Not all of the tips below may apply to you, but even combining a few of them can make a world of difference.
1. comparison shop
What’s the best way to get cheap car insurance? comparing prices and collecting quotes from different insurers could be the best way to save.
However, while it’s crucial to compare auto insurance quotes from multiple companies, it’s also important to look beyond price. A cheap rate doesn’t mean much when the insurance company doesn’t pay your claim.
Sometimes, you already have the best deal with your current auto insurance company. but the only way to find out is to compare it to other companies.
comparison shopping can help you find cheap car insurance companies in your area and even new car insurance discounts.
You may also be surprised to find that a lesser-known company has lower rates. 2022 data compiled by Insurance.com found that American National Insurance had the lowest average rates even when compared to well-known companies such as nationwide and in the US. uu.
Check the automatic quotes every year when your policy renews. think of it like changing the batteries in your smoke detector.
You should also compare prices when:
- buy a new or different car
- combine cars on a multiple car insurance policy
- add or remove a driver from your coverage
- get married or divorced
- move
- add a teen driver
- buy a house
- be convicted of a dui or other major offense ( review dui insurance)
- have a car accident
- have a change in your credit score
Remember, the more you shop around, the more likely you are to find cheap auto insurance quotes.
2. group your policies
One of the best ways to find cheap auto insurance companies is to look for insurers that will offer you a discount if you buy more than one type of insurance. this is known as bundling your insurance policies.
For example, if you buy homeowners or renters insurance from the same company that provides you auto insurance coverage, you can get a discount on both policies.
These multi-policy savings can be up to 29% depending on the company.
Similarly, you can get up to 25% off by taking advantage of a multi-car discount when you insure two or more vehicles with the same company. this discount generally applies to your liability, collision, and comprehensive coverages.
But be careful, bundling coverage doesn’t always save you money. it’s important to compare what it would cost to buy your policies separately to the price discount you get on a bundled deal before you sign on the dotted line. you may be better off buying a separate homeowners policy from one of the cheap auto insurance companies that offer coverage at particularly affordable prices.
The national averages for package policy discounts are:
- 17% auto and homeowners insurance
- 9.6% auto and condo insurance
- 5% auto and renters
- 2% for car and life
3. increase your deductible
Simply increasing your deductible from $250 to $500 can reduce the collision or comprehensive portion of your premium. you can save between 15% and 30%, depending on the national level. increase the deductible to $1,000 and you can save even more, potentially 40%.
Remember, though, a higher deductible means more money out of pocket in the event of a claim. Cheap car insurance can get expensive if you have to pay your deductible with a high-interest credit card. Make sure you understand how auto insurance deductibles work before choosing one.
4. take advantage of all the discounts for which you qualify
Talking to your agent can help you find overlooked ways to save on auto insurance, says Robert Passmore, vice president of auto policies and claims at the American Property Insurance Association. “Consumers should check with their insurance agent or company to have a discussion and ask what discounts are available,” he says. “They will work with you to maximize all of your benefits.”
While you may qualify for many more discounts, here are some of the more common ones that will help you get affordable auto insurance:
good student. Many auto insurance companies offer a good student discount for both high school and college students. a “good student” is generally someone who maintains a “b” average (3.0) or better to qualify for this discount and generally applies to students under the age of 25.
How much can you save? the average base premium for the student driver population is $6,110. Add in a nice student discount, and the annual policy rate drops to an average of $5,750. that’s a savings of $361, or about 7%. the good student discount is a significantly larger reduction than for most other discount categories. this can be a great way to find cheap car insurance for new drivers.
Teen homeschooled drivers may also be eligible. they must achieve a certain score on standardized tests. discount typically applies to bodily injury liability, property damage liability, pip, medical payments, collision, and comprehensive coverage.
students away from home. Similarly, for good students who are in college, most insurance companies offer discounts. A wide range of variables affect the discount rate, including:
- whether or not the student brings a car to school and drives it regularly
- whose name(s) is on the title
- whether the student is or not permanent address remains parents’ home
loyalty. Have you been through thick and thin with your insurance provider? your loyalty could equal savings. Several insurance companies offer this type of discount, which generally reduces rates by up to 10%.
good driver. Good driver and safe driver discounts can save you between 5% and 25%, depending on your carrier. reduce the amount of time you drive your vehicle you can get a discount. more on both later.
vehicle safety. Do you have an alarm or security/anti-theft device, such as a lojack, installed in your vehicle? that could qualify you for a “security features discount” of up to 30% in some cases.
paid in full. if you can pay your annual bill in full, that can save you up to 10%, rather than the more common approach of paying in installments. Going paperless can also add a small discount.
Learn about all the auto insurance discounts you may qualify for so you can take advantage of some reductions on your bill that can really add up.
5. consider insurance when shopping for a car
Whether you’re shopping for a fun car, one that fits all the kids, or a vehicle that puts in a lot of mileage, be sure to think about insurance. Cars that cost less to repair or replace generally have more affordable auto insurance rates.
Don’t make the mistake of thinking “the cheaper the car, the cheaper the insurance”. it doesn’t always work that way. Be sure to compare car insurance rates by vehicle when you shop for a car.
6. avoid fines and accidents
There are steps you can take to avoid costly fines and accident claims. pay attention to your speed, don’t try to run a red light, be more cautious and drive defensively.
A poor driving record can disqualify you from getting the cheapest auto insurance. Insurers will review your record to see if you present a high level of risk. speeding tickets, accidents, driving under the influence citations – all can increase your insurance rates.
As we noted earlier, good driver discounts can save you up to 25%. The insurance company generally requires you to have a clean driving record for at least three years. That means no DUIs, traffic violations, or at-fault collisions.
Drive sensibly and cautiously and you’ll be on your way to cheap car insurance by avoiding late fees and receiving a nice drivers discount. To learn more about how a ticket affects rates, check out our traffic ticket calculator.
7. don’t carry unnecessary insurance coverage
If you have an old beater, you can get cheaper auto insurance by leaving out comprehensive and collision coverage.
However, don’t abandon that coverage without giving it some thought. when should you make this move to cheaper car insurance? many experts say it’s time to drop these coverages when the actual cash value you would receive for your vehicle doesn’t justify the insurance expense.
Another type of coverage that may not be necessary is rental reimbursement coverage. you can skip it if you have an extra car in the household that you can use if yours is in the shop after a car accident, or if you have easy access to public transportation.
Also, you may want to waive personal injury protection or medical payment insurance (if your state doesn’t require it). consider taking this step if your family already has a great health insurance plan.
8. consider purchasing only the minimum liability coverage required by the state
One way to get the cheapest auto insurance rates available is to purchase bare-bones coverage. This protection is generally liability insurance at the lower legal limits required by your state to drive a car legally.
If you cause an accident, pay for property damage and medical bills for others; that’s all.
Liability limits are usually written like this: 30/60/25. in this example, the numbers show the coverage you would pay:
- medical expenses up to $30,000 per person
- medical expenses up to $60,000 per accident
- up to $25,000 for property damage
These are the average annual rates for the cheapest auto insurance coverage in each state.
It is generally not advisable to go with the state minimums, as you may be underinsured and unable to cover serious claims. that could leave you liable to pay thousands or even hundreds of thousands of dollars in damages out of pocket.
but if you don’t drive much and are desperate to find a way to get cheaper car insurance, basic coverage is better than nothing.
9. consider usage-based insurance or pay-per-mile insurance
Policyholders who drive fewer than a specified number of miles each year, typically 7,500 to 10,000 miles, can get a reduction in their base rates. rate cut applies to bodily injury liability, pip, property damage liability, and collision premiums, depending on the policy.
To track mileage, auto insurance companies often require you to install a small device in your vehicle that transmits data to the company. keep it below a certain amount and you’ll get discounts. usage-based programs can also monitor driving habits such as braking and speed.
Actual pay-per-mile insurance allows you to pay based on the actual miles you drive, rather than simply giving a discount for driving less, and doesn’t take driving habits into account.
“Driving fewer miles means you have less time on the road, which translates to a lower risk of having an accident,” says Janet Ruiz, director of strategic communications for the Insurance Information Institute. “Most insurers require annual mileage to offer a lower rate to drivers who travel less on the road.”
passmore notes that many insurance companies will offer you a discount simply for signing up for this type of program, and that price reductions can increase further if the device shows good driving behavior.
“These programs are increasing in popularity as more people work remotely and drive less,” he says.
10. ask about group insurance
Some companies offer reductions to drivers who get insurance through a group plan from their employers, professional, business and alumni groups, and other associations or schools. Insurance Information Institute experts suggest checking with their affiliated organizations to see what they offer.
Employers, of course, often offer group health insurance plans, but a lesser-known option is group auto insurance. larger companies are more likely to offer this option to their employees because the sheer volume of employees allows the company to lock in a group rate.
Large universities or trade schools sometimes offer the benefit of purchasing group insurance not only for their students but for alumni as well.
There are many ways to get cheap car insurance. By doing your research and finding the right plan for you, you can find an auto insurance policy at the right price.
