How to Lower Your Auto Insurance Premiums

Every year car insurance premiums get higher and higher so that the average person living in a metropolitan area now pays $1,500 or more per car each year.  Where can one find cheap car insurance?  The only way to find it is to spend a few hours doing research and comparing prices.  In other words, there isn't a place where one can purchase cheap car insurance.  Cheap car insurance can be won by getting rid of needless coverage, raising your deductible, and shopping around. 

One of the best websites to begin researching cheaper car insurance is Just like their commercials claim, they will give you estimates of their competitors car insurance premiums along with their own. If you use their system, you will see that there is a surprising difference in car insurance premiums from one insurance company to another, sometimes varying by more than several hundred dollars per year.  That is one place to start.  Perhaps simply transferring your car insurance to another company would reduce your car insurance premiums significantly.

Another way to lower your car insurance premium is to raise your deductible to $1,000 if you can.  But remember, if you're in an accident, you won't be covered for any damages less than $1,000, so don' t do this if you can't afford to pay for minor damage on your own your own or don't have the $1,000 deductible ready at all times.

Getting rid of needless extras on your insurance coverage will also help lower your car insurance premiums. For example, if you haven't examined your car insurance policy carefully, you might discover that you've been paying $75 per year to cover towing service.  When was the last time you had your car towed?  Insurance companies sneak this coverage in on anyone they can, but it really is needless insurance coverage if you think about it.  If you had your car towed once in five years, that would mean you paid $75 for five years, or $375, to an insurance company for insurance coverage to cover one tow, which in most areas is $100 or less.

You can also drop any bodily injury insurance provided that it is duplicate insurance, meaning the health insurance plan you have with your employer already covers injuries resulting from a car accident.  If you don't have health insurance, you definitely should not drop the bodily injury coverage.

If your car is old, there probably isn't any reason to carry collision on it.  Why pay $500 per year to insure a car that is worth only $1,000?  It doesn't make sense.  Dropping collision means that the insurance company will not reimburse you for any damage to your car should you cause an accident; it will only pay for the other person's damages.

Another way to obtain cheap car insurance is obtain insurance with with a company that markets its insurance as "one price for all" and promises that it won't check your credit rating. Most insurance companies use your credit score to determine your insurance premium since their research tells them that those with poor credit are three times more likely to get in an accident and file a claim.  This is why those with poor credit are charged significantly more than those with good credit for car insurance.  But, of course, if you have very good credit, you could probably get a better deal with a company that considers credit scores.

One should also take advantage of any discounts offered for completing defensive driving courses, being a veteran or senior citizen, driving your car very little, etc.  Don't be afraid to ask your car insurance agent for help in getting your premiums lowered as much as possible.  Doing this could save you hundreds each year in insurance premiums.

More Ways to Save on Car Insurance

(1) If you drive less than 7,500 miles per year, your insurer might give you a 5 to 15% discount, which could save you as much as $125 per year.

(2) Older Americans who are members of AARP might get a 10 percent discount if they graduate for AARP's Driver Safety Program

See our "Ways to Save Money" section for more tips on saving money on everything associated with owning a car.
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