Did you know you could possibly save hundreds of dollars per year just by switching your car insurance company?
If you work from home or don't drive your car often, you can even qualify for a premium for low mileage drivers.
Check out these 9 money-saving tips that will help you save thousands on car insurance. They worked for me!
1. Look up discounts
Car insurance companies have tons of discounts that people have no idea about.
You can get a discount on your premium for all sorts of reasons, such as:
- Not being in an accident
- Being a good student
- Combining your house and auto insurance
- Having a brand new car
It's wise to talk with an agent about what discounts you qualify for, as their website may not have all discounts listed.
A simple call to your insurance agent can save you hundreds of dollars over the next few years. It is worth asking them, trust me!
2. Be over 25 years old
Your car insurance will go down dramatically once you hit this magical age.
This is the age insurance agencies mark the age of “responsible” driving, so you pay less than someone who is 16 years old and just got their license. 16-year-olds may be more prone to get into more accidents (especially with texting and driving on the rise) so they have to pay more.
Just make sure you don't get into any accidents before this age (or after!) and your insurance will be incredibly cheap, especially if you have an older car.
3. Compare insurance company rates
Get multiple quotes for your car in the area and sign up for car insurance with the company offering the lowest premium.
After comparing quotes, see who will also give you the most discounts.
You may find that one agent has a cheaper quote, but that another agent with a more expensive quote offers more discounts.
For example, even though I already have car insurance, I decided to shop around to see what rates would be for my car with different agencies.
Agency #1 quoted me $150/month for full coverage on my 2019 Toyota Corolla Hatchback.
Agency #2 quoted me $90/month for full coverage on the same car.
Agency #2 (which is State Farm) is obviously the cheaper route.
Not only that, I do several things to pay even less which I'll include here:
- I'm in their good driver program, where I have a Bluetooth set up in my car that tracks my driving. I get 5% off.
- Bundle discount (I have an insurance policy with my boyfriend, plus a rental insurance policy)
4. Drop full coverage on old cars with little value
When I had a 20-year-old car, I ended up dropping all coverage besides mandatory coverage and this took my premium down to $40 a month.
I made this move because my old car was worth less than $1,000, so there was no point in me paying for an expensive premium for years.
5. Increase your deductible
Increasing your deductible from $500 to $1,000 can help save quite a few bucks over the span of a year.
Only do this if you are capable of paying that $500 in case you are in an accident.
If you do decide to go this route, I recommend saving up for an emergency fund of 3-6 months of your expenses.
6. Drive responsibly
Avoiding accidents and tickets can help keep your insurance low.
When you get into accidents, your current and future agents will know and thus your premium will increase.
Texting and using cell phones has increased car accidents tremendously. To ensure that you do not use your phone when you're in your car, I recommend putting your phone in the back seat (or even in the trunk!). Make it out of hands reach.
If you don't want to do that, simply turn off the sound on your phone. It'll be hard to not check your phone at first if this is a habit, but over time you will get rid of this bad habit and you won't do it anymore.
I don't check my phone when I'm driving because I've seen the terrible accidents that people get in that even kill people, so I cannot in good conscience be on my phone scrolling through Instagram while driving.
7. Share a plan with your partner
Combining policies with a loved one will decrease the annual premium.
If you decide to combine your home insurance policy with your car insurance policy, you may qualify for a larger discount as well.
Both you and your partner will save a good portion of the money and you can still pay for your policies separately with your own credit/debit cards.
8. Combine insurance policies
Do you have an auto, house, and life insurance policy?
You may want to consider combining all the policies together as you will likely qualify for a pretty good discount.
9. Pay every 6 months
Paying your premium in full can give you a decent discount.
If you have the money to do so, you might as well since you can save a few bucks.
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