Reducing Car Insurance Policies

To reduce car insurance coverage, increase your deductible, find discounts, or carry the minimum requirements. The minimum auto insurance requirements will cost you the least of any option, but it may not protect you adequately. Before you reduce car insurance coverage, compare rates with our quote comparison tool.

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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: Jan 22, 2021

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Here's what you need to know...

  • The minimum required car insurance will cost you the least of any option, but it may not protect you adequately
  • Look into applicable discounts
  • If a higher deductible will work with your finances, try that to keep monthly costs down
  • A clean driving record will result in a lower premium


Customers who are interested in reducing their automobile insurance policies have several choices available. When pricing is the main consideration, they can buy only the minimum level of coverage required for their state or raise their deductible.

Another option to get a break in pricing is to for consumers to make sure they are getting all the discounts they are entitled to. Finding car insurance discounts is a great way to shave money off of your monthly auto insurance premium costs.

Another great way to save money fast on car insurance is to use our free tool above to compare rates from many different providers. Just enter your ZIP code above to get FREE car insurance quotes!

Buy the Minimum Level of Coverage

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Most parts of the United States have laws in place requiring drivers to have car insurance.

Not all states require drivers to buy insurance protection other than bodily injury liability and property damage liability coverage.

The minimum coverage varies, depending on the state.

Buying only the minimum amount of coverage mandated by law is one way to keep costs down, but customers should keep in mind that this may not be enough protection if they are the at-fault driver in a serious accident.

In that case, the insurance policy will pay out up to the policy limit (less the deductible) and the driver is financially responsible for paying any amount that remains.

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Raise the Deductible

The deductible is the amount that a car insurance buyer has agreed to pay out of pocket before the insurance company will pay any benefits under the policy.

When a customer chooses a higher deductible (and takes on a higher level of financial responsibility), he or she is rewarded with lower premium or coverage rates.

When this option is used to reduce premium rates, the customer needs to consider this move carefully. It may be attractive to get lower rates by raising the deductible, but since the customer must pay this amount directly, it shouldn’t so high as to cause financial hardship.

If a high deductible of $1,000 will put too much strain on a customer’s budget, they should consider lowering it to a more manageable level.

Auto Insurance Policy Discounts

Insurance companies offer several types of discounts to customers that can provide them with savings on the cost of their coverage.

Most companies offer multi-policy discounts, which means that buying car insurance from the same company that sold the policyholder his or her homeowners, commercial or life insurance means better pricing.

The more products the customer buys from the same provider, the better the pricing offered on all products.

Members of professional, business or trade associations may be able to get preferred pricing by buying their car insurance from a selected company. In this situation, the association has negotiated a special rate on behalf of its members.

It’s worthwhile for members of any kind of professional group to contact the administration to find out whether any type of arrangement has been made for members to get a break on car insurance pricing.

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Car insurance companies are also willing to provide discounts to customers who are driving vehicles equipped with the following:

  • safety features
    • like seat belts
    • anti-lock brakes
  • anti-theft devices

Keeping the car in a locked garage when not being driven makes it less likely that the vehicle will be targeted by thieves, which means it is less risky to insure.

Taking an approved driver’s education or defensive driving course is another way to get a discount on the cost of car insurance.

It’s a good idea for new drivers to learn from a professional driving instructor so that they don’t start the process by making errors that may make it more likely that they will become involved in an accident.

Experienced drivers can benefit from taking a defensive driving course to correct errors they may have been making without realizing they were doing so.

Even good drivers who have never been involved in an accident can benefit from taking a refresher course to reinforce what they are doing right and to ensure they continue to have a clean record.

A clean driving record is a very attractive trait in an applicant for car insurance.

Companies look to an individual’s past driving record as a predictor of future behavior and even reward customers for maintaining a good record by offering a discount on pricing.

Keep a Clean Driving Record

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More than anything else, your history as a driver is the main factor in determining the price of your insurance. If you have a history of violations or accidents you will undoubtedly face higher insurance premiums because you pose a greater risk.

Points will be added to your license as a means of grading your performance for all moving violations like the following:

As the number of points on your license increases, so will your insurance rates. So the best thing you can do to keep your insurance costs down is to not allow any points to accumulate.

Always drive safely and within the confines of the law; always drive according to road and weather conditions; always drive defensively rather than aggressively.

As a side note, distracted driving is becoming one of the biggest problems on America’s roadways.

According to statistics compiled by the National Highway Transportation Safety Administration, nearly 5,500 people were killed in 2009 as the result of distracted driving, and another 448,000 were injured.

And the number one cause of distracted driving? Cell phone use and texting. If you want to keep your insurance rates as low as possible, turn off your phone when you’re driving.

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Other Ways to Keep My Insurance Rates Low

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There are some things you can’t do anything about, like the following:

  • your age
  • your gender
  • your demographic group

But you can control other things that are well within your reach.

For example, parking your car in a garage overnight will reduce your insurance premiums. If you have a garage, and it’s packed full of stuff, it might be a wise idea to clean it out and use it for its intended purpose.

If you have multiple drivers in your household you can keep your insurance rates lower by assigning the most valuable vehicles to drivers with the lowest risk.

Your brand-new Lexus should be driven by mom or dad, while the 10-year-old Chevy should be driven by the teenagers.

Finally, you should always check with your car insurance company about any discounts you might be eligible for. Discounts for things like safe driving, good grades, and the like, can go a long way in positively affecting your insurance premiums.

One of the best ways to reduce automobile insurance policies is to shop around for the best rates. Spending even a short time comparing quotes from different companies can result in significant savings.

To find out how much you can save by switching companies, why don’t you click on the FREE insurance quote tool on the bottom of this page right now?

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