How do I keep my car insurance low?

The best ways to keep your car insurance low are 1) maintain a good driving record, 2) ask your insurance company about discounts, and 3) compare online quotes.

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Zaneta Wood, Ed.S. has over 15 years of experience in research and technical writing bringing a keen understanding of data analysis and information synthesis to reach a wide variety of audiences. She studied adult education and instructional technology at Appalachian State University as well as technical and professional communication at East Carolina University. Zaneta has prepared technical p...

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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: Sep 15, 2020

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Here's what you need to know...

  • Many factors in keeping your insurance rate low are within your control
  • Keep your driving record in check to get the lowest rates
  • Ask your online representative if you qualify for any discounts
  • Shop around and compare providers before making your final decision

Believe it or not, there are ways that you can influence that amount of money that you will pay each month on your car insurance premiums.

Everyone needs car insurance. It protects drivers from those unforeseen events and gives them a way to pay for damages. Without insurance, you would have to pay for such damage and injuries to others out of your pocket.

But insurance costs can create a problem for some drivers. It is something else that has to be budgeted each month. Insurance can cost anywhere from $75 per month to $400 per month, depending on your age and demographic group, your driving record, and other factors.

But how do you keep your car insurance premiums low? Below is a list of actionable tips that you can use to keep your insurance as low as possible.

Many customers immediately lower their insurance rates just by entering their zip code into our FREE comparison tool above!

Keep Your Traffic Violations in Check

First and foremost, keep your traffic violations low. It is a fact that car insurance companies base their decision on premium amounts primarily on your driving record.

There is a direct relationship between the number of traffic violations and the tendency to be involved in future accidents.

You may also want to get a copy of your driving record. This is the same information that insurance providers will use to base their decision on your premium.

Knowing the standard they are using may help you to understand your rates and shop around to see who gives you the best rate.

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Take a Defensive Driving Course

People tend not to change their driving habits immensely over time unless they become more conscious of their driving by getting a ticket or take a defensive driving course.

Taking a driving course is similar to attending a Driver’s Ed class and gives you a refresher course regarding the basic rules and regulations of driving.

It may make you more aware of the potential hazards and help you avoid a collision.

There are plenty of defensive driving courses available in various states that may benefit you.

Once you take the course, make sure and document that you took the course and send a copy to your insurance company.

Obey All Speed Limits

The most common traffic violation is breaking the speed limit. The problem is that many drivers do not realize they are going as fast as they are.

You may be on the interstate, on the way to work, or just running errands around town. We all get in a hurry at times and may be exceeding the speed limit far above what is allowed.

Breaking the speed limit in certain areas, such as a school zone, may cost you more than a speeding ticket.

Parents and teacher organizations have formed ad hoc committees for pushing law enforcement to prosecute violators in school zones to the greatest extent of the law.

It’s understandable since their children’s lives are at risk, and there have been a great number of accidents involving children being run over by motorists over the past few years.

The statistics involving accidents that involve fatalities of children in school zones should concern everyone.

Most are due to the negligence of motorists passing through the school zone who ignore the speed limit sign or fail to yield to pedestrians.

This has become a growing concern over the years. So make sure you are not guilty of this. It can greatly affect your driving record and insurance rates.

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Choose the Coverage You Really Need

While it’s important to choose multiple coverage areas when needed, you should only choose those that you know you might need.

Liability, bodily injury, and property damage are necessary to make sure that you are covered for these important areas.

Liability and bodily injury are both required in all states except two. Property damage is also required. You may also want to carry collision and comprehensive insurance, to make sure your damage will be repaired after an accident.

If you carry uninsured and underinsured insurance, you will be covered even if the crash was not your fault.

Uninsured and underinsured insurance covers accidents when the other party was at fault but they did not carry the required insurance.

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Should I carry extra coverage?

That being said, extra coverage like medical coverage, roadside assistance, and rental cars should be thought through carefully.

Check your health insurance and see how much coverage you have.

If you feel you have sufficient coverage through your health policy, there may not be a need to carry medical coverage through your car insurance.

One of the most common financial mistakes people make is to carry double coverage in their insurance. Ask your insurance representative if they feel you need the coverage.

Know the Statistics

It helps to understand the statistics of accidents and whether you are in a high-risk group. Statistics alone are just numbers.

But when you realize that they are based on facts, it can cause you to evaluate your driving habits and improve your driving record.

The highest risk group to date is male drivers between 18 and 24. More specifically, the CDC reports that male drivers between 16 and 19 have the most fatal and serious accidents.

Drivers who are just learning to drive may have over-inflated confidence in their ability to handle various driving situations that they are not ready for.

Perhaps they are too careless or engage in risky driving behaviors. DUI is sometimes a factor, as well.

Whatever the reason, slow down and think about what you are doing.

Ask for Discounts

Another way you can lower your insurance rates is to ask for insurance discounts. Discounts may be available to you for the following reasons:

  • Good student record – Some insurance companies may offer discounts for a good student record. This means that, if you can produce proof that your grades and behavior in school are good, you may qualify for a discount in premiums
  • Good driving record – Over time, your insurance premium may go down due to a good driving record. If you obey all traffic signs, keep under the speed limit, and avoid accidents, it certainly will not increase
  • Defensive driving course – If you take a defensive driving course, you may qualify for a discount on your premium. This is because it is believed that people who successfully complete a defensive driving course are less likely to have accidents
  • Student living away from home – Some insurance providers also issue discounts to drivers who are students living away from their hometown. Ask your insurance representative if you qualify for this discount
  • Military discounts – If you are in the military or if you have ever been in the military, you will likely qualify for a discount on your insurance premiums. Be sure to ask your representative and let them know your military status if they do not ask you
  • Disability discounts – Some providers also allow for discounts if you have a disability or require any type of help in driving
  • Employee discounts – Some insurance companies issue discounts to people who work for a government agency. Civil engineers, policemen, county officials, and even teachers may qualify for this discount if it is offered

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Shopping for Insurance

All of these tips should help you to lower your premiums to some extent and make your insurance more affordable. Many of these things are within your control as a driver. Some are not.

However, if you keep your driving record clean and apply for discounts as they are available to you, you may see a decrease in your premium.

Also, when shopping for insurance, choose the coverages carefully so that you get what you need without doubling up on coverages.

We tend to think in the present and we want to save as much money as possible in the short-term.

But don’t forget that the most important thing is making sure you have adequate coverage so that you won’t have a financial disaster due to failure to carry insurance. The risk is just too great.

Enter your zip code into our FREE comparison tool below to get started!

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