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Whether you've had your car for years, or just purchased a new one, you'd probably like to save on car insurance. Just because you have to have it doesn't mean you shouldn't look for the best deal. Most drivers know that bundling their auto coverage with other policies -- like homeowners or renters insurance -- can help them save on insurance. Opting for a higher deductible will also lower your monthly premium (though you'll have to earmark some of your savings in case you need to pay it). But if you've already done those things, and are still wondering how to save on car insurance, there are still some methods you can try.
Adjust your coverage
Although you'll always need to maintain coverage on your car, you won't always need the same amount of coverage. Comprehensive coverage might make sense if you've just purchased a new car, but the older your car is -- and the more it depreciates -- the less necessary it becomes. Many drivers even drop collision coverage as their cars age. Check your car's value at least once a year to see if anything more than liability is really worthwhile.
If your driving habits change -- for example, if you move closer to your job or to another place you drive often -- you may also be due for a reevaluation of your premium. Most companies determine premiums at least partly based on your driving habits, including the distance you typically travel. If yours decreases, let your insurance agent know.
Look for discounts
Most insurance companies provide at least a few discounts for their members, based on their payment behavior (if they opt for automatic withdrawals or pay in a lump sum), vehicle safety features, and other factors. Many also partner with particular employers, financial institutions, or schools, giving better rates to their employees, customers, and alumni.
- Allstate: Allstate offers such a wide menu of discounts that most drivers are bound to qualify for at least one. The company gives members credit for being over 55 and retired, being a full-time student under 25 with good grades, completing defensive driver training, and going at least three years with a clean driving record, among other factors.
- State Farm: State Farm customers under 25 with good grades, and those who've gone at least three years without an at-fault accident or moving violation, or who've taken a defensive driving course are all eligible for discounts.
- Esurance: Those new to Esurance can get a discount for switching, or for getting a quote from the insurer's website. Full-time students under 25 with at least a 3.0 GPA, older drivers who've taken a defensive driving course, and those who've gone at least three years without an accident get discounts, too.
- AARP/The Hartford: AARP members already qualify for a discount on their auto insurance, but younger drivers on their policy can also save. Drivers under 21 can take an approved driver training course, and full-time students under 25 can submit proof of their good grades.
- Liberty Mutual: Liberty Mutual customers qualify for a number of discounts. If you switch to the company, are a full-time student under 25 with at least a B average, are a new graduate, are newly retired, or have just moved, you'll receive discounts on your premium.
If your coverage is too expensive, and you're thinking about switching providers, call your current company first. Your agent may be able to lower your rate and save you the trouble of changing companies.
Find added value
Insurance is a competitive business. To attract customers, some companies offer added perks to membership, like including specialized services that others require you to pay for separately.
- New car replacement. If you buy a new car and it's totaled within the first year, companies with new car replacement programs will replace your wreck with another new car, not just send you a check for the depreciated value. Liberty Mutual offers this as a standard feature, and Allstate offers it for customers subscribing to Your Choice Auto. AARP has a similar plan that replaces a car up to 15 months old.
- Lifetime repair guarantee. If Liberty Mutual customers choose to have their car serviced at an approved shop, Liberty Mutual will provide a limited lifetime warranty on their repair.
- Disappearing deductible. AARP's Advantage Plus members who maintain a good driving record can take $50 off their deductible every year. There is no limit on this benefit; after long enough, customers can reach a deductible of $0.
- RecoverCare. AARP's RecoverCare benefit will pay for you to hire assistance with common household chores if you're injured in an accident. It won't save you money on car insurance, per se, but it will save you a lot of money on other services if you do need to use it.
Before you drop your policy, think about what it might be offering you for no extra charge. And if you do switch, look for a company that provides added benefits for your money.
If you're wondering how to save money on car insurance, there are almost always ways of knocking some money off your premium. As insurers increasingly check credit scores when determining rates, even your financial health can have an effect on your payments. Consider trying to increase your credit score if you want to bargain with your insurer. In addition, it's always a good idea to gather new car insurance quotes every year. Maybe a lifestyle change you've had in the past 12 months can get you a better deal on coverage with a new company, or the one you already use.