How to Lower Your Auto Insurance Premiums

If you need to know how to lower your auto insurance premiums, you’ve come to the right place. There are a few tried and true methods that can help you reduce your car insurance rates.

Taking advantage of discounts offered by insurance companies is one great way to lower your rates. Cheap car insurance rates are sometimes offered as an incentive to get new customers. You can see how to switch auto insurance providers here.

Other ways to save are to reduce coverage or to reduce the amount that you drive. You could also consider changing the car that you drive as certain vehicles are more expensive to insure. Another thing that makes auto insurance rates cheaper you’re already doing: getting older. Young drivers are often the most expensive.

If you want to save on your auto insurance, you can compare rates with our FREE tool.

Savings after Coverage: How to Lower Auto Insurance Premiums

Getting approved for coverage is only half the battle. If you aren’t careful, your insurance provider might not give you the best deal on a monthly rate. But there are tips, tricks, and strategies you can use in order to lower your monthly payments down to a manageable level.

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What factors raise or lower my premium?

You probably know about some factors that can raise your rates: age, accidents, and moving violations. We’re going to cover not just these things that can cause your auto insurance rates to rise but several ways you can lower your premiums as well. (For more information, read our “How Accidents Change Your Car Insurance Rate“)

How does my driving record affect my auto insurance premium?

The fewer accidents you have on your record within the last few years, the better. And if your record is squeaky-clean and accident-free, then you’ll receive some of the lowest rates around. This is because insurance companies love covering safe drivers who are the least likely to file a claim. The more money they can make off of you by not paying out claims, the more they will thank you with lower rates.

But don’t panic if you have some blemishes on your driving record. Most companies are only legally allowed to calculate your risk based on your driving history over the past 3 years. Anything older than that – whether it’s a minor speeding ticket or a serious accident – will not be considered when your provider calculates your monthly rate.

Insurance Rates and Your Driving History

Legend:
Minor Speeding Ticket
Reckless Driving/DUI Conviction
At-Fault Accident
Several Citations on Your Record
A Clean Driving Record

Florida
Texas
Illinois
California
New York

25
50
75
100
125
150
175
200
225
250
275
300
325
350
375

$159
$225
$199
$320
$126

$114
$160
$136
$276
$105

$42
$49
$52
$75
$34

$91
$164
$101
$170
$64

$107
$153
$95
$381
$93

Does the type of car I drive affect my insurance rates?

Yes, the car you drive has a very significant impact on your monthly rate after moving. After all, your insurance policy follows your vehicle, and not specifically you, the driver. These factors affect your auto insurance rates – such as how expensive your car is, how fast it can go, how likely it is to get stolen, or even its color – which can raise your rates substantially. But if you haven’t purchased a vehicle yet, you can compare cheap auto insurance by make and model to see which vehicles will get you the best deal.

Car Insurance by Make/Model

Legend:
An Expensive Sports Car
An Affordable Sedan

California
Florida
Illinois
New York
Texas

25
50
75
100
125
150
175
200
225
250
275
300
325

$198
$64

$226
$126

$130
$34

$340
$93

$145
$105

How does where I live affect my auto premium?

Whether you’re moving across the country or a few blocks down the road, changing zip codes can and will influence your monthly insurance payment. Insurance companies use statistical data, based on particular zip codes, to calculate how likely their customers are to get into an accident or otherwise need to file a claim near where they live. So if your zip code has a high population, high rates of accidents, high rates of theft/vandalism, lots of severe weather, or a combination of those factors, prepare for a rate increase (or a rate decrease if the opposite is true in your new zip code).

How Rates Vary By Zip Code

Legend:
Typical Insurance Coverage

Illinois Average
California Average
Florida Average
New York Average
Texas Average

25
50
75
100
125

$34

$64

$126

$93

$105

Can I decrease my auto insurance coverage?

If you consider yourself to be a safe and responsible driver and doubt you will get into any serious accidents in the near future, you can check your state laws to see what the bare minimum insurance coverage requirements are.

Then you can call your insurance agent and ask that your policy reflect these minimum amounts. However, this can be a risky move; sure, you’ll save money on your monthly premiums, but if the worst happens and you get into an accident that a bare minimum policy doesn’t cover, you could face some seriously expensive out-of-pocket costs.

Another way to lower your monthly premium is to raise your deductible on your Comprehensive or Collision coverages. This will make your coverage less expensive each month – however, you run the risk of having to pay that higher deductible in the event that you need to file a Collision or Comprehensive claim. Additionally, many automotive insurance experts recommend dropping comprehensive and collision altogether if your vehicle is worth less than $1,000.

Different Levels of Coverage

Legend:
Comprehensive Coverage
Simple Coverage

Texas
Florida
California
Illinois
New York

25
50
75
100
125
150
175
200
225
250
275

$105
$105

$216
$126

$172
$64

$88
$34

$285
$93

Does my age affect my premiums?

Yes, age is a big factor in determining your premium if you fall into a specific age group. Younger drivers under the age of 25, for example, get hit with some pretty expensive rates. Older drivers between the ages of 50-65, however, can leverage their many years of driving experience to get substantially lower rates.

How Insurance Rates Vary By Age

Legend:
31 Year Old Driver
64 Year Old Driver
75 Year Old Driver
18 Year Old Driver

California
Florida
Illinois
New York
Texas

25
50
75
100
125
150
175
200
225
250
275
300
325
350
375
400
425
450
475

$64
$57
$76
$181

$126
$72
$191
$275

$34
$28
$45
$88

$93
$79
$223
$482

$105
$85
$140
$310

A special note for parents with young drivers: if you have a child under the age of 25, and if your insurance company permits it, you both could save money by putting your child on a family auto policy with you. Yes, your rates will go up; however, they are not going to be nearly as expensive as they would with your young driver on their own policy. Not to mention that your provider might offer more discounts for insuring more drivers on the same policy.

Can I pay my premium in advance to lower my rate?

Most insurance companies give their customers two different payment options: either pay your premium monthly or pay in advance every 6 months. If you choose to pay in advance, your provider usually offers a discount of 10% or more off of the 6-month lump sum price.

What are three things you can do to reduce your auto insurance premiums?

You can lower your rates by:

• increasing your auto insurance deductible,
• taking advantage of car insurance rate discounts for new customers by changing insurance companies, or
• bundling homeowners and auto insurance for a discount.

Of course, comparing rates between companies in your area could save you even more than that! To find the lowest automotive insurance quotes in your area, simply enter your zip code below to begin comparing prices and providers.