The easiest way to save on car insurance is by switching providers.
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Unlike life, renters, and other types of insurance, car insurance is essential. It is required by law to operate a car or truck. With the average car insurance premium costing around $472 for a 6-month policy (for a 30-year old with a good driving history), it leaves many people wondering – can I lower this number at all?
While it depends on your circumstances, we found that most individuals can reduce their current car insurance rate by 12% to 50%+.
There are a few options to explore and reduce your premium:
You can save as much as 50% or more, just by switching car insurance providers alone, depending on your state, driving history, and other factors.
State Farm and USAA are the most affordable car insurance options on average. Does that mean that if you’re already insured with either one of these, you’re golden? Not necessarily.
Car insurance is state-regulated. That means that the price can fluctuate drastically depending on the state you live in. State Farm may be the cheapest insurance provider for Kentucky, but not for California.
In addition to what state you live, car insurance rates vary based on the vehicle’s make, model, and year, as well as your personal driving history. An accident will increase your rate, no matter what carrier you’re with. But again, this varies greatly by insurance providers.
| Carrier | Before accident | After accident | Difference |
|---|---|---|---|
 |
$1,600 | $1,910 | $310 (+19.4%) |
 |
$1,200 | $1,621 | $421 (+35.1%) |
 |
$1,985 | $2,888 | $903 (+45.5%) |
 |
$3,261 | $4,931 | $1,670 (+51.2%) |
 |
$2,200 | $3,500 | $1,299 (+59.3%) |
| Calculate your price | |||
Always compare multiple carriers, even if a carrier is known to be the cheapest in your state.
You can save as much as 68% by opting for a $2,000 deductible, rather than a $50 deductible. This is true for both collision only and full coverage policies.
As previously mentioned, a car insurance rate varies based on multiple parts. And your deductibles account for a large chunk of your rate.
Put simply, a deductible is out-of-pocket money you need to pay in case of an accident before the insurance provider chips in.
The most common deductibles are $1,000, $500, and $0. Or you could pass on having a deductible to lower your cost to the absolute minimum.
So let’s assume if you have a $1,000 deductible and you bump into a shopping cart while parking your vehicle. There was no significant damage, but a noticeable scratch would still cost $600 to fix. Unfortunately, you’ll have to pay this out-of-pocket since your deductible is $1,000.
If in the same scenario your deductible is $500, you pay $500, and the insurance provider pays $100. If your deductible is $0, you pay nothing, and the insurance provider pays the complete $600.
Naturally, a $0 deductible will be the most expensive, followed by $500 and then $1,000.
| Deductible | Collision only | Full coverage |
|---|---|---|
| $50 | $142 | $638 |
| $100 | $124 | $546 |
| $250 | $99 | $449 |
| $500 | $84 | $367 |
| $1,000 | $51 | $287 |
| $2,000 | $45 | $201 |
| Calculate your price | ||
It depends on a few factors, such as:
According to the Insurance Information Institute organization, only 6.1% of collision insurance policyholders file a claim every year. Of individuals with a full-coverage policy, only 3% file a claim per year.
So by law of averges, it's likely you will file a claim once in 20 years. Saving $90/month by opting for a $1,000 deductible rather than a $50 deductible for 20 years would accumulate to a total of $21,600. That's a lot of savings.
Depending on the carrier, most individuals can lower their bill by 10% to 15% with common discounts.
A discount on car insurance? Yes, please! And no, you don’t have to be a senior or veteran (thank you for your service) to be eligible for them.
These are a few typical (and unnusual discounts) that could help lower your bill:
You can save as much as 23% by bundling multiple insurances like home and auto. However, this varies entirely by your insurance provider.
Another discount, although not so hidden, is bundling insurance plans. Even if the carrier you have – or switch to – doesn’t offer the lowest car insurance rate out there, the final cost could still be cheaper by bundling.
| Company | Bundle discount |
|---|---|
|
23% |
 |
15% |
|
15% |
 |
15% |
|
7% |
|
6% |
| Calculate your price | |
Not sure if bundling insurances is an option for you? Depending on the carrier, you can bundle home, car, motorcycle, life, even pet insurance.
So even if you find the lowest insurance carrier for each of these individually, chances are likely you could save money, and a whole lot of headache, by bundling all your insurances with just one carrier.
While we don't recommend just liability coverage to everyone, it can make perfect sense in some cases. Liability covers damages caused by you to other vehicles and property, but it does not protect your vehicle. But, if your vehicle isn't worth much and you don't owe on it, liability can make sense.
You can add collision coverage or collision and comprehensive coverage if you want better coverage, commonly known as "full coverage".
Learn more about collision and comprehensive coverage.
