Finding Inexpensive Rates for Auto Insurance
To get inexpensive car insurance rates, drop collision and comprehensive coverage, raise your deductible, and comparison shop. Use our quote comparison tool to find inexpensive car insurance.
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Joel Ohman
Founder & CFP®
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...
Founder & CFP®
UPDATED: Jul 8, 2023
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident car insurance decisions. Comparison shopping should be easy. We are not affiliated with any one car insurance company and cannot guarantee quotes from any single company.
Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from top car companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.
UPDATED: Jul 8, 2023
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident car insurance decisions. Comparison shopping should be easy. We are not affiliated with any one car insurance company and cannot guarantee quotes from any single company.
Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from top car companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
On This Page
- The definition of “inexpensive” depends on your individual criteria
- There are ways to reduce your premium
- Consider a higher deductible to save on your monthly premium
- Comparison shop to make sure you’re getting the best deal you can
You may be wondering if finding inexpensive car insurance is even possible, especially if you are struggling each month to pay this necessary bill.
The truth is, it is possible to find more affordable rates if you shop around, but don’t expect to get your insurance for next to nothing. That just isn’t possible.
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Whether or not you even find certain car insurance rates affordable, depends on your own perspective.
If you have a high-end sports car or high-performance car, for example, and are paying $350 a month for car insurance, you might think that the person who pays $150 a month has inexpensive car insurance while that person thinks their rates are outrageous.
Considering Your Coverage Type
Many people struggle with making their monthly payments for their car insurance, especially when the economy is struggling.
Some people have simply stopped paying their premiums and live in fear of having an accident or of their state sending them a notice that their license and registration have been suspended.
One way to help manage your payments is by keeping your rates low. You can do this by ensuring that you don’t have any more insurance than necessary.
We aren’t simply talking about switching to liability only; although if this is all you can afford, it is better than nothing. You need to look at what you are paying for your additional services.
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Dropping Collision and Comprehensive
For example, many people carry collision and comprehensive coverage that don’t need it. Your insurance company will only pay any claims on your vehicle for the value of that vehicle.
If you are driving an older car that has very little value, it is possible that you are paying for coverage that won’t benefit you down the road.
One way of measuring whether or not either of these coverage types has any value for you is to find out the value of your vehicle. If your comprehensive and collision coverage are half the price of the value of your car, then you should drop this coverage.
In plainer terms, if your car has a value of $1,000 and your comprehensive and collision coverage costs $500 or more a year, then it doesn’t have any real value to you, especially if you are carrying a $500 deductible.
Both collision and comprehensive plans are best reserved for vehicles that have significant value and that would require thousands of dollars to replace if you were to have an accident or your vehicle is stolen, damaged by weather or vandalized.
Considering Your Level of Coverage
Another thing that you need to think about if you need inexpensive car insurance is to consider what your level of coverage happens to be.
If you are financing a vehicle, then you may not have any choices when it comes to lowering your coverage levels; however, this is something that you need to look into before assuming you have to keep higher levels.
Every state has a minimum liability requirement that you must maintain on your vehicle.
While in most cases this minimum won’t cover a serious car accident, if you can’t afford your premiums, then you should look at lowering your level until you are in a place where you can afford to increase it again.
You should also consider maintaining a higher deductible, which will often reduce your rates drastically. Keep in mind that this is the amount of money that you will have to pay out of pocket when/if you have an accident.
If you can’t afford the deductible, then you need to consider other options.
Where You Buy Your Insurance
Lastly, you need to consider where you are buying your insurance. Many people don’t believe it when they see car insurance commercials from companies that say that they can save them money on their coverage.
The truth, however, is that insurance companies charge different rates for their services. You could easily find yourself saving hundreds of dollars simply because you took the time to shop around for car insurance from multiple companies.
Why people don’t take this step is surprising; after all, it is a free process that doesn’t require any purchase from you. You can fill out the basic information and receive car insurance quotes from several companies, which you can compare side by side.
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Free Car Insurance Comparison
Enter your ZIP code below to view companies that have cheap car insurance rates.
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Case Studies: Finding Inexpensive Rates for Auto Insurance
Case Study 1: The Value of Coverage
In this case study, John owns an older car with little value. His collision and comprehensive coverage cost him $500 per year, which is half the value of his car. After assessing the situation, John decides to drop these coverage types, as they don’t provide any real value to him.
Case Study 2: Adjusting Coverage Levels
Sarah is financing a vehicle and has been struggling with high insurance premiums. She investigates her coverage levels and realizes that she can lower them without violating the minimum liability requirements set by her state. By reducing her coverage levels and opting for a higher deductible, Sarah manages to significantly reduce her rates.
Case Study 3: Shopping Around for Quotes
David has been paying high premiums for his car insurance and decides to explore other options. He uses a quote comparison tool to compare quotes from multiple companies. To his surprise, he discovers that different insurance companies offer varying rates for the same coverage. By shopping around, David finds a new policy that saves him hundreds of dollars.
Frequently Asked Questions
How can I find inexpensive rates for auto insurance?
To find inexpensive rates for auto insurance, consider the following steps:
- Shop around and compare quotes from different insurance providers.
- Maintain a good driving record and avoid traffic violations.
- Opt for a higher deductible, which can lower your premium.
- Bundle your auto insurance with other policies, such as home or renters insurance, to potentially receive a multi-policy discount.
- Inquire about discounts, such as safe driver discounts, good student discounts, or discounts for installing safety features in your vehicle.
- Consider reducing coverage on older vehicles or vehicles with lower market value.
What factors affect auto insurance rates?
Several factors influence auto insurance rates, including:
- Your driving record: A history of accidents or traffic violations may increase your rates.
- Vehicle make and model: High-performance or luxury cars generally have higher insurance premiums.
- Age and gender: Younger and male drivers may face higher rates due to statistical risk factors.
- Location: Insurance costs can vary based on the area you live in, including factors like crime rates and traffic congestion.
- Credit history: In some states and countries, your credit history can impact your insurance rates.
- Coverage and deductibles: The level ofcoverage and deductible you choose can affect your premium.
Can my credit score impact my auto insurance rates?
Yes, in some states and countries, insurance companies consider your credit history when determining your auto insurance rates. Research suggests a correlation between credit history and the likelihood of filing claims. However, this practice may not be applicable in all regions or for all insurance providers.
How often should I shop around for auto insurance?
It’s a good idea to shop around for auto insurance rates at least once a year or whenever you experience a significant change in your circumstances, such as moving to a new location, buying a new vehicle, or experiencing changes in your driving record.
Are there any drawbacks to choosing the cheapest auto insurance option?
While inexpensive rates may be appealing, there are potential drawbacks to consider:
- Limited coverage: Cheaper insurance policies may offer less coverage, leaving you financially vulnerable in case of an accident or damage.
- Higher deductibles: Lower-priced policies may come with higher deductibles, meaning you’ll have to pay more out of pocket before your insurance kicks in.
- Subpar customer service: Some budget insurance providers may not offer the same level of customer service or claims handling as more established companies.
- Limited perks and discounts: Cheaper policies may not provide the same range of discounts or additional benefits as higher-priced options.
Free Car Insurance Comparison
Enter your ZIP code below to view companies that have cheap car insurance rates.
Secured with SHA-256 Encryption
Joel Ohman
Founder & CFP®
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...
Founder & CFP®
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.