How Do I Lower My Car Insurance?

Everyone’s made mistakes. You shouldn’t have to pay for them indefinitely.

2018 INFINITI Q60
INFINITI—© 2017 INFINITI

Car insurance is a necessary evil. Every month, or six, a bunch of cash is removed from your bank account and offered up to an insurance provider in the hopes that, if you ever get into a car accident, the company will pay for a new car, repairs, and/or your medical bills. And it tends to be a lot of money for something you may or may never need. 

Though critical to your driving safety and continued legality, recurring monthly payments without any immediate benefit tends to produce questions about lowering those payments. What’s the average cost of car insurance? Why am I paying so much for car insurance? What affects my car insurance cost? And, most of all: “How do I lower my car insurance?” 

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It can be difficult to decipher the answers to those questions, as there’s a glut of misinformation, suspect websites offering help, and scammy advertisements that “help” you reduce your monthly bills. That’s why your friends at The Drive put together this guide to better help you understand how you can lower your car insurance. There are some variables you’ll need to consider, though, so please pay attention. 

Ready to bolster your bank account? Let’s get into it. 

What’s the Average Cost of Car Insurance?

You may already be aware of this, but car insurance varies from person to person due to variables such as make and model, type of car owner, model year, your driving history, specific insurance coverages chosen, location (i.e. where you live, city, state, climate), and your credit, among other specifics. 

That said, according to the financial site NerdWallet, the average cost of full coverage car insurance in the United States as of 2021 is $1,592 a year, or about $133 a month. The company’s analysts stated, however, that this number is for folks with good credit. Those numbers spike for people with a no-fault accident ($2,439), poor credit ($2,812), and DUI ($3,114) as variables.

The averages for the bare-minimum insurance coverage for the United States are also different, with the national average pegged at $565 for a good driver with good credit, $884 after an at-fault accident, $984 for a good driver with bad credit, and $1,152 after a DUI. 

EXTENDED INSURANCE COVERAGE MORE … FOR LESS

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Why Is My Car Insurance Expensive?

Your car insurance is a reflection of you. It’s based on your coverage choices, your driving history, your credit, where you live, and the make, model, and type of car you own. However, your car insurance may be more expensive than the averages detailed above for a few main reasons. Let’s get into those.

Driving History

If you’ve been driving like you were Mario Andretti or Lewis Hamilton since the age of 16, clipping apexes and accruing a gallery’s worth of speeding, reckless driving, and moving violations, then your car insurance is going to reflect such...habits. The author speaks from teenage experience that he’s since apologized to his parents for.

Likewise, a history of accidents, or even just one, will cause a spike in your insurance premiums because your specific provider will deem you more at risk than others. DUIs have a huge negative impact on your insurance, and in some cases, it can actually void your insurance. 

Make, Model, Type of Car

What?! You’re telling me that a Bugatti Chiron Pur Sport will have a higher insurance premium than a Honda Ridgeline?! Pero ¿por qué! While that comparison might be out of the realm of reality for most, it stands as a good example of how the make, model, and type of car affect your premium. 

Sports cars, luxury vehicles, supercars, and rare rides all demand higher premiums due to their speedier demeanors, accouterments, price tags, and exacting engineering. 

Credit

Your credit history, whether good or bad, will also affect your insurance costs. Folks with good credit are looked upon as more financially stable and will have their premiums lowered. Bad credit the opposite, as shown above. 

Location

Where you live affects your insurance premiums too. Cities, high-crime areas, or commuting hubs will all increase your premiums, while small-population towns and locations with shorter commuting distances will lower them. 

Furthermore, if you live in an area where natural disasters like tornadoes or hurricanes are present, your premiums will also likely increase due to the potential of Mother Nature decimating your ride. 

A Chrysler Pacifica mini-van.
Stellantis

A Chrysler mini-van will have a lower bill than a Bugatti, too. 

How Can I Lower My Car Insurance?

There’s no one tried-and-true method of reducing your car insurance bill because your specific coverage, your driving history, location, type of car, and a host of other variables all play parts in the final financial toll. The Drive can only offer a few different options to either begin to lower your premiums or reduce your monthly bill. Let’s dig into those.

Don’t Drive Like a Racecar Driver

If you’re getting a speeding ticket every six months, you need to chill out. Moving violations will increase your insurance premiums, as your provider will deem you at a higher risk than someone who’s obeying all the traffic laws. Cool it and save your speeding for a racetrack or autocross course. 

Don’t Drink or Do Drugs and Drive

DUIs and DWIs can lead to massive insurance spikes or the nullification of your insurance altogether. Not only that, but it’s massively stupid, hugely dangerous, and totally selfish. Don’t drink or do drugs and drive. Period. 

Shop around for Insurance

One of the easiest ways of lowering your car insurance costs is by shopping around. By looking at competitors to your current insurance, you may find another company has bigger discounts, will offer your more attractive rates for switching, or has lower premiums while maintaining your specific coverages. Don’t be afraid to reach out to a few different brokers.  

Choosing Higher Deductibles

When selecting coverages, you can also choose higher deductibles to reduce your monthly cost. By doing so, you increase the amount of out-of-pocket expenses in the event of an accident. There are pros and cons to this, as not everyone will have a few thousand dollars in savings if the worst were to happen. 

Bundle Your Policies

If you’re a homeowner or even a renter, you can bundle your home and rental insurance policies with your auto insurance and reduce your overall monthly payment. Family discounts are also sometimes available.

Look for Discounts

Most insurance companies offer discounts, whether that’s for new drivers, good drivers, drivers with good credit, military vets, and others. You can scroll through your insurance provider’s website and find all the discounts you qualify for. 

Reduce Your Coverage on Older Cars

Older cars aren’t worth what they were when you drove them off the lot. As such, your coverages may be out of date compared to what the car’s worth. Do a little research on the value of your car using a resource like Kelly Blue Book and see if its value matches what you’re paying for with your insurance premiums. If there’s a difference, you can reduce your coverages to better line up with the car’s value. 

What’s the Cheapest Car Insurance?

The cheapest insurance you can purchase is the bare minimum regulated by your state. This is often Liability-Only insurance, and it’s not something we’d recommend as it doesn’t properly cover you in the event of an accident. 

It will also vary in terms of pricing as per the factors and variables detailed above, as well as insurance providers, and discounts available. Do your homework, shop around, and make sure you’re properly covered when the hand of fate deems you unworthy that day. Learn more about this type of insurance with our guide, What Is Liability Auto Insurance?

What Should I Spend for Car Insurance?

How much you spend on car insurance will depend on the coverages you choose, the variables above, and which insurance provider you go with. As with everything else, there’s no specific answer and you’ll have to do some research and decide how much you’re going to spend yourself. 

Though again, we do not recommend you purchase Liability-Only insurance, as it only covers the bare minimum and can leave you paying thousands, or even hundreds of thousands, of dollars out of pocket for medical, car repairs, and legal bills. A helpful method for choosing car insurance is to ask friends, family, and others in your specific area who they use, what they pay, and which companies cause the most headaches. The more comparisons you have, the more confident you can be when choosing a provider.

EXTENDED INSURANCE COVERAGE MORE … FOR LESS

Hagerty

Automotive insurance for classic car lovers

For insurance for your classic car, truck, or motorcycle, Hagerty is full-service insurance for drivers who love their classic vehicles. Get a quote today on an insurance policy for up to 36 percent less than daily drivers.

Get a Free Quote

Video

Here’s a quick summary of how your driving history affects your car insurance premiums. 

FAQs About Lowering Your Car Insurance

You’ve got questions. The Drive has answers!

Q: Does the color of your car increase or decrease the cost of your insurance?

A: Ah, the red car myth. Yeah, it doesn’t exist. The color of your car will not affect the price of your insurance,. As mentioned earlier, it’s more about the type of car you own. As red has been a popular car for sportier vehicles, many associated the color with a rise in insurance cost, rather than the car’s performance credentials. Don’t be fooled. 

Q: How do insurance driving trackers work?

A: Insurance trackers aren’t a new phenomenon. They were actually launched way back in 1998 by Progressive. The trackers plug into your car’s OBDII port, monitor your driving habits, and then send your data back to your insurance company. From there, analysts look at how you drive and can make a determination to either lower or raise your insurance as a result. 

You read that right, your data could be used against you, so think before you get one of these devices.

Q: Should I get an insurance driving tracker?

A: We’d say no. While they’re purely opt-in, meaning you have to ask for one from your insurance company, the amount of data that’s fed to the company is vast and not always limited to your driving habits. And in the event of an accident, your insurance company can take a minor deviance in your driving ahead of the accident, something that could also be caused by bad or corrupted data, and not support your claim. What that means is you’d be out of pocket for all repairs, medical bills, and legal claims.