How to lower your auto insurance: 10 ways to save in 2024 

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If you feel like your car insurance costs keep going up, you’re not alone. Motor vehicle insurance costs increased 18.6% between July 2023 and July of this year, according to Bureau of Labor Statistics data.

There are many reasons why car insurance rates are increasing, such as rising car repair costs, higher crash rates, higher instances of vehicle theft and more frequent severe weather events. Even if you maintain a clean driving record, avoid claims and have a good credit score, you might still see a significant rate increase depending on your location. 

Fortunately, there are many ways to lower your car insurance premium. Among the moves: You can go with a higher deductible, ask your insurer about discounts, adjust the type of coverage you have or bundle your car insurance with another policy 

And if your policy is up for renewal, you can shop around for a carrier that offers lower rates.

How to save money on car insurance in 2024 

Here are 10 ways to reduce your car insurance rate this year: 

1. Shop around for an insurer that offers lower rates 
2. Bundle car insurance with another policy 
3. Choose higher deductibles 
4. Look for discounts 
5. Get insurance quotes before buying a new vehicle 
6. Prioritize safe driving habits 
7. Adjust your coverage levels 
8. Choose a minimum coverage policy 
9. Consider pay-per-mile insurance 
10. Get group insurance or an affinity discount 

1. Get new car insurance quotes 

One of the most effective ways to lower your car insurance premium is to comparison shop. Getting quotes from many  car insurance companies can help you find the lowest price for the coverage you want. 

Even if you think you have a reasonable rate through your current insurer, comparing quotes regularly is the only way to know — compare quotes now.

In general, it’s recommended that you get new quotes when your policy comes up for renewal, after filing a claim, and following a significant life event, like getting married or adding a teen driver to your policy. 

An April 2023 study from CarInsurance.com found that less than half of drivers (49%) shopped for a new car insurance policy in the past 12 months. Of the people who switched insurers, 26% of drivers saved 10% on a new policy, and 29% of people saved 15% on a new insurance policy. 

Granted, not every insurance company is suitable for everyone. However, some providers are considered better than others. 

Insure.com does an annual ranking of the best auto insurers. Among the companies at the top of the ranking:

State Farm: State Farm ranked first. The company stands out for its customer satisfaction and excellent in-person service. It received one of the highest scores for trustworthiness, and 93% of its customers said they would sign up again with the company, according to a consumer survey Insure.com used in its ranking. Additionally, State Farm has an A++ credit rating for financial stability from AM Best, which is the highest rating possible. The company offers a good selection of discounts, including two safe driver rewards programs. 

Geico: Geico is the third-largest auto insurance company in the U.S., and it has been growing over the past few years. Geico is known for its cheap car insurance prices, which we verified by studying average rate data. The company’s average car insurance premiums are much lower than major competitors, like State Farm and Progressive. Geico also scores well for customer satisfaction, ease of service and policy renewals in Insure.com’s survey of insurance consumers. 

Auto-Owners: Auto-Owners is another well-ranked company. It’s rated highly for customer renewal rates and affordable monthly rates. In addition, Auto-Owners has excellent third-party ratings. It has an A++ (superior) financial strength rating from AM Best and a J.D. Power score of 837 out of 1,000 for customer service – slightly higher than the industry average of 834. Auto-Owners also stands out for its extensive discounts and good coverage options. 

Travelers: Travelers is one of the highest-rated car insurance companies in Insure.com 2023 Best Car Insurance Companies study for customer satisfaction. We also found that Travelers scores well for its home and auto bundles and is recommended by many current customers. Regarding costs, Travelers has lower insurance rates than many of its competitors. Travelers is also a good option for drivers who want to customize their policy, as the company offers a big selection of endorsements. 

Nationwide: Nationwide is one of the most well-known car insurance companies, and it’s highly ranked for its affordable rates, renewals, and overall claims satisfaction. In Insure.com’s Best Car Insurance Companies study for 2023, Nationwide ranked No. 5. Nationwide’s premiums are consistently lower than most of the companies in our survey, but it doesn’t have the best discounts. We found that some of Nationwide’s competitors, like Geico and State Farm, offer more ways to save. 

2.  Bundle car insurance with another policy 

When you purchase two insurance policies from the same company, such as car insurance and home insurance or renters insurance and car insurance, you can often get a significant discount on one or both premiums. This is called bundling your policies. In some cases, bundling can produce a combined savings on home and auto insurance of 15-25%.

Before you purchase an insurance bundle, you should get quotes for the individual policies to determine how much (if any) you will save. Here are the national averages for multi-policy insurance discounts: 

• 17% for auto and homeowners insurance 
• 9.6% for auto and condo insurance 
• 5% for auto and renters 
• 2% for auto and life 

3. Choose higher deductibles 

Some car insurance coverages have a deductible, which you pay out-of-pocket when you file a claim. The most common coverages that require a deductible are collision and comprehensive insurance, which are included with full coverage insurance. 

When you choose a higher deductible, it will reduce your monthly premium. For example, raising your collision and comprehensive deductibles from $250 to $500 can significantly lower your rates. If you increase your deductible to $1,000 or higher, you could save as much as 40%. 

However, it’s important to remember that raising your deductible means you’ll pay more out of pocket if you need to file a collision or comprehensive claim. If you have to file a claim soon after raising your deductible, it could exceed any savings you made before the claim occurred. 

4. Look for discounts 

“Many insurance providers offer discounts, and in some cases, you can stack those discounts for greater savings,” says David Cooley, an insurance agent with Country Financial. 

The exact discounts available will vary based on your insurance company, but some of the most common discounts include: 

• Good driver. Good driver discounts can help you save anywhere from 5% to 25%, depending on your insurance company. This discount is typically offered to drivers who have no recent violations or claims on their record. 
• Good student. Many insurance companies offer a discount to full-time high school and college students who maintain a “B” grade point average (GPA) or better and are under 25 years of age. A good student discount could save you almost 15% on your insurance.
• Students away from home. It’s common for insurance providers to offer discounts to teens and young adults who attend school at least 100 miles from home and don’t take their vehicle with them. Usually, this discount only applies to collision and comprehensive insurance. 
• Loyalty. Some insurers reward loyal customers with a discount. If you have been insured with your current company for several years, you could earn a discount of up to 10%. 
• Vehicle security. If you insure a vehicle with an anti-theft device, you could qualify for a “safety-feature discount” of up to 30%. Some companies also offer discounts if your vehicle has airbags, anti-lock brakes, and/or collision avoidance technology. 
• Pay in full. Paying your annual car insurance premium in full usually results in a small discount. Oftentimes, paying upfront can reduce your annual rate by as much as 10%. 

5. Get insurance quotes before buying a new vehicle 

If you’re considering purchasing a new vehicle in 2024, get car insurance quotes before you decide on a make and model. The type of vehicle you get greatly impacts the cost of car insurance.

While you might assume that cheap cars have cheap insurance rates, that’s not always true. Instead, you should compare car insurance rates by vehicle when shopping for a car. 

Which cars have the lowest insurance rates? Based on recent rate data from Quadrant Information Services, the five cheapest cars to insure are the Subaru Forester 2.5I Wilderness, the Hyundai Venue SE, the Honda CR-V LX, the Mazda CX-30 S, and the Toyota C-HR XLE. 

In the table below, you can see the top 20 cheapest vehicles to insure:

The least expensive cars to insure in 2024

6. Prioritize safe driving habits 

One of the biggest factors that will impact your car insurance premium is your driving record. 

“You don’t have to get into an accident to see your car insurance rates increase. Speeding tickets and other traffic offenses can also make those costs jump,” Cooley says.

To get a lower rate, it’s essential to prioritize safe driving habits and limit risk. That means paying attention to your speed, obeying all traffic signs and stop lights, driving defensively, and limiting distractions while you drive. 

If you have a poor driving record with multiple violations or claims, it could disqualify you from getting the cheapest car insurance. Insurance companies charge higher rates to drivers that pose the greatest risk. 

Not only will a clean driving record and good claim history help you get the best rate for your situation, but you might also qualify for additional discounts. As we noted earlier, good driver discounts could help you save up to 25%. Usually, insurers require that you have a clean driving record for at least three years to get this discount. 

7. Adjust your coverage levels 

Adjusting your coverage levels is another way to reduce your car insurance premiums. For example, if you have an older vehicle, it might make sense to drop your comprehensive and/or collision insurance, two types of coverage for physical damage to your vehicle.

If you don’t owe money on your car, these coverages can be dropped when your vehicle’s actual cash value (ACV) – what your car is worth – is less than your annual premium and deductible combined. If your car was severely damaged or totaled, having collision and/or comprehensive insurance wouldn’t save you any money in the long run. 

You might also consider dropping endorsements that may be unnecessary, like rental reimbursement coverage, which pays for a rental car when your vehicle is damaged or stolen. You could get by if, for instance, you have an extra car in your household, or you can take public transportation if your car needs to be repaired after a crash.

However, it’s important to consider the potential risks of dropping pieces of your insurance policy to secure a lower premium. 

“While you may explore trimming coverages or making changes to your deductible, talk with your insurance agent and make sure you completely understand the impact of those cost-saving changes,” Cooley says. “They could have long-term consequences if you get into an accident or need to file another claim.” 

8. Choose a minimum coverage policy 

Almost every state requires drivers to carry a minimum amount of car insurance. A minimum coverage insurance policy is the cheapest type of auto insurance you can legally get. 

But minimum coverage only provides liability insurance, which covers your financial responsibilities when you cause an accident that results in someone else’s injuries or property damage. It may not be enough to cover serious claims. And it doesn’t cover your vehicle’s repairs or your medical bills if you get injured.  As a result, you could be responsible for paying a significant amount of money out-of-pocket. 

While minimum coverage isn’t recommended, it can be sufficient for people who don’t drive often, have a very low-value vehicle or need to get the cheapest insurance available. 

9. Consider pay-per-mile insurance 

If you drive infrequently, consider a pay-per-mile insurance policy to save money. This type of insurance is designed for people who drive less than a specified number of miles per year, usually 10,000 miles or less. 

With a pay-per-mile, or mileage-based, insurance policy, car insurance companies often require you to install a small device in your vehicle that tracks your mileage and transmits your odometer reading to the company. 

You’ll pay a flat monthly rate to keep your policy active and a small fee for every mile driven. The less you drive, the less you’ll pay for insurance during any given month. 

Keep in mind that pay-per-mile insurance is not the same as usage-based insurance. Pay-per-mile insurance policies only track the number of miles you drive, not your actual driving habits, like brake force and speed. 

10. Get group insurance or an affinity discount 

You might qualify for a lower car insurance rate through a group plan, your employer, or a membership group. For instance, some companies offer their employees a group car insurance plan, which often has a cheaper premium than you’d pay as an individual. You can also find group car insurance plans through certain universities and trade schools. 

Some insurance companies also offer car insurance discounts for customers who belong to affinity groups. For example, you might qualify for a lower rate if you are a member of a fraternity or sorority, a professional business group, or a membership-based organization such as AARP or AAA. 

Our recommendations for reducing car insurance costs 

There are countless ways to save money on your car insurance policy, but you need to be proactive. By comparing costs, researching savings strategies, and taking advantage of discounts, you should be able to lower your premium significantly. 

What our expert says

Q: Should you change coverage levels to lower your car insurance rate?

David CooleyInsurance agent, Country Financial.

“While you may explore trimming coverages or making changes to your deductible, talk with your insurance agent and make sure you completely understand the impact of those cost-saving changes. They could have long-term consequences if you get into an accident or need to file another claim.”

Resources & Methodology

Sources

U.S. Bureau of Labor Statistics, “Consumer Price Index Summary,” accessed January 2024.

Insure.com’s “Best Car Insurance Companies,” accessed January 2024

Methodology

Insure.com commissioned Quadrant Information Services to calculate the average auto insurance average based on full coverage for a single 40-year-old male who commutes 12 miles to work each day, with policy limits of 100/300/50 ($100,000 for injury liability for one person, $300,000 for all injuries and $50,000 for property damage in an accident) and a $500 deductible on collision and comprehensive coverage. This hypothetical driver has a clean record and good credit. The rate includes uninsured motorist coverage.

Elizabeth Rivelli

Contributing Researcher

 

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Elizabeth Rivelli is a freelance writer who covers various insurance topics. Her areas of expertise are life insurance, car insurance, property insurance and health insurance. Elizabeth’s byline has appeared in dozens of online publications, including Investopedia, CNET and Bankrate. She has also written for several insurance carriers.