How to Save Money on Car Insurance

To save money on car insurance, you can negotiate for a lower rate, search for discounts, and research before purchasing a car. If you shop around for the best rates, you can save money on car insurance.

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A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP®

UPDATED: Jun 25, 2020

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Here's what you need to know...

  • You can often negotiate with your current insurance provider for a lower rate
  • Insurance companies offer additional discounts that they don’t always let you know about
  • If you are willing to shop around for the best rates, there’s a good chance you will find cheaper coverage

When the economy spirals downward, many people try to find new ways to save money.

Believe it or not, one of the easiest expenses to reduce is the cost of car insurance.

Even the insurance companies themselves are facing the economic decay. As a result, they are forced to seek new customers. The easiest way to accomplish this is to offer special deals to new clients.

That spells good news for you!

There are several ways you can go about saving money on your car insurance. We’ll cover the best methods to save money below!

Enter your zip code in our comparison tool above to find affordable car insurance quotes from multiple companies for FREE!



There are actually several steps to negotiating for a lower car insurance rate.

  • Step 1: Get Quotes from Different Insurance Companies – Even if you are planning to try and negotiate with your current insurance company, you should still get quotes from other companies. The best way to do this is to search the web for companies who offer online quotes. Make a list of different quotes and compare that list to your current car insurance rate.
  • Step 2: Negotiate with your Current Insurance Company – Once you have quotes from other insurance companies, you can start to negotiate with your current one. If you’ve found other companies that offer you lower quotes, your company is more likely to give you a lower rate. If they don’t negotiate with you, then it’s time to go with a different provider.
  • Step 3: Negotiate with New Companies – Before switching insurance companies, you should call each of them and tell them you’re planning to switch. Some may be willing to give you an even lower rate. It’s worth a shot! Once you are done negotiating, then make the switch.

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Search for Other Discounts

The next step toward lowering car insurance costs is to search for additional discounts with your car insurance provider. These discounts may be small, but the savings add up in no time!

Good Driver Discounts: You might be eligible for good driver discounts. This can help you save money without having to make changes to your existing plan.

Remove Unnecessary Coverage: There are a lot of optional aspects to insurance coverage that many people assume are required. An example would be towing. You can save up to $30 a year by simply removing this from your policy.

Car rental coverage is another expense that is only necessary for those who travel a lot.

Renting a car only once or twice a year is very low risk. Even if there is an accident, your normal insurance will still cover you, and this can save you up to $40 a year!

Raising your Deductible: Although this can initially save a lot of money, there are several factors that should be considered before raising your deductible.

First of all, be sure to check the legal requirements in your state. Some states require drivers to hold lower deductibles. Second, be sure that you can afford the higher deductible in case something goes wrong.

Finally, consider the fact that, if you have an accident, the cost of repairs might be more than the cost of the policy. You should only raise your deductible after carefully considering all these factors.

Other Tips

Here are some other factors to keep in mind when searching for car insurance savings. These small items can add up to a rather large savings.

Think Ahead When Buying a New Car: Before purchasing a new car, be sure to research the insurance costs that will be applied to the new vehicle.

It’s a general belief that vehicles like SUVs are more expensive to insure.

However, the truth is that insurance costs are based on the likelihood of damage incurred during a wreck. There are several insurance sites where you can run comparisons on the costs of different vehicles. It’s best to compare these costs before buying a new vehicle.

AccessoriesAccessories that you purchase for your vehicle are not covered in a dollar-to-dollar basis. That means that fancy rims, stereos, and other accessories might cost thousands of dollars but only be seen by insurance companies as worth a few hundred.

This is something to ask potential insurance companies about before purchasing coverage from them.

Pay Annually: Making annual insurance payments is a lot cheaper in the long run than paying a month to month bill. In fact, you can save hundreds of dollars by choosing this option.

Consolidate all your Insurance Policies: Many people have different types of auto insurance (boat, car, motorcycle). However, they might have these policies through different companies.

Most insurance companies offer packages that offer savings to those who consolidate all of their insurance policies through them.

This is a great way to save money and simplify your payment options.

Let us help you save money on car insurance. Enter your ZIP code in our comparison tool below for multiple FREE car insurance quotes.

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