Car insurance premiums can sometimes feel like a waste. For years you pay money for a product you hope you never need to use. But if you’ve been in an accident, you know first-hand just how important it is to have quality insurance coverage.
The trick is to find that quality coverage from a reputable company at an affordable price. After all, wouldn’t it be nice to have some of that money you’ve been paying toward your car insurance still sitting in your pocket?
In an effort to help you save money, we’ve compiled a list of six hacks that can help you lower your car insurance rates.
1. Bundle your car insurance with other policies
If you have other insurance policies, such as homeowners insurance or renters insurance, a great way to save is by bundling your policies with the same company. Of course, you need to first make sure your car insurer offers the other policies you need and has a strong reputation for those insurance products. But in the event they check those boxes, bundling your policies together can provide major benefits. Not only will you likely save on your car insurance, you should see lower rates on your other bundled policies as well.
2. Consider raising your deductibles
This option comes with a risk, but you’re essentially betting on yourself by selecting a higher deductible. In doing so, you’re assuming more of the risk from the insurance company, and thus are rewarded with a lower premium. For instance, you could opt to select a $1,000 deductible rather than a $250 or $500 deductible. Keep in mind though, you’ll be required to pay that deductible before your insurance coverage kicks in if you have a claim. You should only raise your deductible if you have the budget to handle the more expensive out-of-pocket cost come claim time. The savings from selecting a higher deductible may not seem like a lot at first, but if you go years claim free, the savings can really add up!
3. Pay your car insurance policy in full
This hack falls in a similar category as the deductible one — if your budget allows, paying your full premium up front can be a great way to save money. Think about it this way, you’ve got to pay that premium eventually, so why not pay it in full if you have the money set aside? By not paying monthly, you’ll likely earn a discounted rate, and you also won’t have to worry about forgetting about those monthly payments and the associated fees.
4. Try usage-based car insurance
Drivers allowing their insurance company to monitor their driving habits is becoming increasingly popular. Many of the nation’s largest insurers offer usage-based tracking through apps or devices, which can earn drivers discounts for demonstrating safe driving practices and/or driving fewer miles. One insurer, Metromile, offers pay-per-mile insurance, which can result in significant savings for drivers who don’t log many miles annually. Another insurer, Root Insurance, actually requires its policyholders to complete a 2 to 3 week test drive phase to determine if it’ll insure you.
5. Monitor price changes to your policy
If you’ve been loyal to your insurance company for years, it can be easy to miss how much your rates have changed. Often times, the changes may be subtle from policy to policy, but if your rates have steadily been creeping up, the difference over time may be more than you think. Staying with a company can help you earn discounts, but make sure you’re monitoring how much your rates change at each policy. If you notice it trending in the wrong direction, it may be time to shop around!
6. Shop for better rates
Ultimately, the most savings may come from changing insurers altogether. In Clearsurance-conducted research, we found that surveyed participants who decided to switch car insurers saved an average of $390 on their annual car insurance bill. The trick is putting in the time. In our research, we found that the more quotes consumers received, the more likely they were to find savings — 60 percent of participants who received four or more quotes switched carriers.
However, don’t be fooled by a low price dangled in front of you! Savings can be great, but sacrificing coverage and insurance company quality isn’t worth a few extra dollars in your wallet. When searching for potential new companies, find the best insurers in your state and read reviews on Clearsurance to learn from other policyholders experiences with the company!
Bonus hack: Ditch the car!
We’re joking — well mostly! If you’re looking for the ultimate savings, there’s no better way than to sell your car. We know this isn’t realistic for most people, but if you live in a city with good public transportation, maybe it’s time to consider whether that car payment and insurance bill is worth it. If you can get by with a combination of public transportation, Uber, car sharing, biking and walking, you’ll see more savings than anyone else!
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