How to Lower Your Car Insurance

By Michael Taylor

September 6, 2013

How to Lower Your Car InsuranceAuto insurance, or any kind of insurance for that matter, is one of those things in life that kind of gets me riled up. I know it’s there for our protection and that’s a good thing. I want to protect my family against accidents or other things out of my control. What gets my blood boiling is it seems that anytime you have to file a claim to your insurance company your insurance premiums go up. If insurance is one of those things you just can’t avoid, then it’s good to understand how to minimize the cost. In this post I’ll provide some tips on how to lower your car insurance so you don’t bust your household budget.

Raise Your Deductible

One of the first steps to get a lower car insurance premium is to ask for a higher deductible. By default, you’ll typically get a $500 deductible on your policy, maybe lower. Ask for a $1000 or higher deductible. Why? When you do this, in the eyes of the insurance company, you are taking on more risk. For the insurance company this is a good thing. You then get rewarded with a lower insurance premium. So your month to month cost is lower. It’s a win-win situation. Of course, you’ll need to make sure you have a $1000 emergency fund saved up to cover unexpected expenses.

File Fewer Claims

Another effect of the higher deductible is that you will typically file fewer claims. Unless you have a significant event that causes a lot of damage, most repairs will likely be less than $1000. If you are filing frequent claims you are viewed as a high risk by the insurance company. Fewer claims will also keep your premiums lower in the long run.

Bundle Your Insurance

Buying your auto and homeowners insurance from the same company can save you 10-20%. That’s a pretty nice discount to take advantage of. Also, rather than paying your premiums monthly make your payment every 6 months or even annually. This can save you some more money.

Shop Around

It also pays to shop around when you’re looking to purchase auto insurance. Contact an independent insurance agent for a quote. They are not limited to one company. They will do the leg work to shop around at different insurance companies for the lowest rate.

There’s a lot to consider in how to lower you car insurance. Be patient, persistent and take it one step at a time. It pays off…. Literally!

Your Turn

Do you have any money saving tips on how to lower your car insurance?  Leave your tips below in the comments on how to get a lower car insurance premium.  Thanks!

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photo credit:  Colin

About 

Michael Taylor is the founder of the Household Budget Coach blog. He is the father of 3 boys and 1 daughter and is married to his beautiful wife Amy. He enjoys hiking and camping with his family and the occasional amusement park. He and Amy have been living debt free since September 2009. Find out more about Michael on . You can also connect with him on Facebook and Twitter.