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Joanna Johnson

Car Insurance Expert
Updated: 02/2022

Joanna is an expert on understanding how the different laws and regulations in the car insurance industry shape the way that policies work.

Auto insurance is one of the assuredly recurring maintenance costs associated with any car. It is also important to have the right coverage for your car. Since your car is vital to your everyday life, it is essential that you buy the right kind of car insurance.

As car insurance can be costly for some people, saving money should be one of the factors while buying car insurance. The following ten tips are meant to help you keep the premiums within your budget while also covering your car and another form of liabilities that may arise due to an accident.

how to find cheap car insurance

Perform an Annual Rate Check

Most car users continue to renew the same insurance policy thinking it’s the best rate that they are paying for the coverage.

This is particularly true in case you have not made any claims recently. It was found in a survey by the Consumer Reports National Research Center that only 10 percent out of about 19,000 car owners compared premiums to check if they would save money by switching insurers. There are several aggregator websites where you can compare the auto insurance premiums from multiple insurers.

You can either individually check the rates of each insurer, or you can take the help of an independent agent, who will check the rates for you at a range of carriers.

Choose a Reputed Insurer

While it's good to save money, it is also essential that you chose a quality and reputed insurer, instead of one that is cheap. Remember that saving money only on premiums isn't the only goal.

Some insurers that offer cheap premiums will cost you more ultimately by low balling loss estimates, raising an objection at repair shops to cut corners, and forcing you to pay extra for replacement parts. You might also have to pay extra in the form of increased premium after an accident.

That is why you must always look at the bigger picture when choosing an insurer. Conduct thorough research and find out the insurers that are the most trusted. Some of them are USAA, Amica, and NJM, with overall satisfaction scores of 90 or higher.

Choose the Right Deductible

Several car owners choose to set a higher deductible because it slashes the premiums. On the other hand, a higher deductible means you will have to pay more out of your pocket if you ever make a claim. For instance, if your deductible is $200 and you increase it to $500, you could save up to 30 percent on premiums.

If you increase it up to $1,000, you could save up to 40 percent. A higher deductible on collision is a good choice when you have a good driving record and have never had an at-fault accident.

However, at the same time, you must make sure that you are able to pay the cost if you ever get into an accident and need to make a claim.

Look into Your Coverage

The biggest benefit of car insurance is the liability coverage that pays for physical injury and vehicle damage caused in accidents.

A lot of car owners try to save money by reducing liability limits to the state minimum. But instead of doing that, it's wiser to take a look at all your coverage and check what you need and what you don't.

For instance, if you have a second car that you can use while your vehicle is being repaired, you don’t need to pay for rental reimbursement coverage.

Don't choose roadside assistance if you have a better deal with an auto-club membership or if it’s part of your new car’s warranty. Also, consider personal-injury protection and medical-payments coverage. You don't need it if you have good health coverage, but you must keep it you don’t or if your regular passengers are not well insured.

Make Use of Discounts

Insurers offer a wide range of discounts if you have a low-risk driving history and lifestyle. If you are a student with good grades, a new driver with a driver-training course, an older driver with a refresher course or defensive-driving course, you might be eligible for certain discounts.

Buy Multiple Policies

If you buy your home, rent, car, and life insurance from the same insurer, you might be offered hefty discounts. But before making the purchase, make sure to check out total costs of premiums from different insurers and also from single-insurer packages. If you save more by purchasing all your insurance from the same place, it might be a good idea.

how to find cheap car insurance

Be careful with teen drivers

When you add a teenager to your policy, it can double your costs. Therefore, instilling safe driving habits is a must. Make sure that the teen takes safe driving lessons, and inform your insurer if the teen isn’t licensed or if they live away from home without a car.

Keep a Good Credit Score

In most states, your credit score is a deciding factor for insurance premiums. If your insurance company also uses a credit score to set premiums, having a suitable credit score can lower your premiums. A concrete credit score has numerous benefits across a variety of financial situations, including insurance premiums.

But make sure that there are no errors in your credit reporting. If your credit score has been negatively affected by unemployment, divorce, military deployment, the death of a family member, or medical problems, you may also ask your insurance company to make an exception.

Report Reduced Mileage

A big element in car insurance is mileage per year. The average is about 12,000 miles, but if you usually drive a lot less than that, you must let your insurance company know. If you’re not aware of this, reduced mileage can save five to ten percent from your premiums.

Choose Your Car Wisely

Damage to the vehicle is the biggest cost of insurance, so the stronger the vehicle, the less you will have to pay in premiums. Before buying a car, talk to your insurer regarding the quotes on different models. Then buy the one that has the strongest build and the least reports of damage.

Car insurance is for protecting your vehicle, yourself, others and other’s properties in case of an accident. Also, a single factor cannot be the basis for selecting your insurance service provider. Consider at least 2-3 factors that are mentioned above to buy the right kind of insurance for your car.