How 2 Simple Steps Slashed My Car Insurance Rate by 19 Percent

A surprisingly simple two-step process saved me a lot of money on auto insurance premiums. Find out how I did it.

How 2 Simple Steps Slashed My Car Insurance Rate by 19 Percent Photo by Lisa S. / Shutterstock.com

I recently paid my latest car insurance bill — and it felt good.

Now, don’t get me wrong: My household wasn’t pleased to part with $575. But it was nice to know we were getting a decent rate, rather than wondering if we were getting gouged.

By shopping around, we saved ourselves about 19 percent — which amounts to $263 a year. It wasn’t difficult or time-consuming. We simply did a little research online, boiling things down to a simple two-step process.

1. I got quotes from 2 other insurers

Our journey to a lower car insurance bill began with getting quotes from two other auto insurers. Then, we compared those costs to what it would have cost us to renew with our old insurer.

We limited the search to two companies to keep it simple. My husband and I looked over the two insurance companies’ websites. Then, we entered our information, examined available discounts and fiddled around with policy options to find out what each company would charge us. This took maybe 10 minutes.

Both companies quoted us premiums that were lower than our old insurer would have charged us. So, we decided to dump our old insurer and chose one of the two new candidates.

Once we had made the decision to change, we moved on to tweaking our policy options.

2. I tweaked our deductible

Before looking over policy options, I asked my husband to read “The Complete Guide to Getting the Best Possible Deal on Car Insurance.” The article, by Money Talks News founder Stacy Johnson, is the best primer I’ve seen on scrutinizing every line of your insurance policy.

The article also emphasizes that raising your car insurance deductibles is one of the best ways to lower your premiums. And raising my deductibles was the main thing I wanted to change about my policy.

I was weary of paying a premium that I knew we could lower by simply raising our $250 and $500 deductibles. And I was tired of listening to my former-auditor husband veto that change with talk of “what if’s.”

So, I put my foot down, and I put it to him something like this:

“An accident is indeed a possibility, but a premium is a certainty. Do you really want to commit to the certainty of paying more money every six months just because of the possibility of an accident?”

All of our deductibles are now $1,000.

Other aspects of our policy that we looked at but decided not to change include:

  • Comprehensive and collision: We considered dropping this coverage because our car is 9 years old. But we decided to keep it after doing the math — going by the 10 percent rule of thumb that Stacy explains in his article.
  • Personal injury protection: We made sure this coverage was no more than $10,000 — the minimum required in our state — for the same reason that Stacy cites.
  • Uninsured motorist: We opted to continue paying for this coverage. We live in Florida, which has a larger share of uninsured drivers than any other state, according to the Insurance Information Institute.
  • Payment frequency: We opted to continue paying our bill in full every six months rather than making monthly payments. Like many companies, our new insurer cut us a little break for this. If you can’t swing a full payment, consider using a budgeting program like YNAB (short for “You Need A Budget”). It’s designed to help you break the cycle of living paycheck to paycheck.

The bottom line

This story stems from a personal experience, but the bottom line is universal: Anyone can save money by shopping around for car insurance — and the process is simple and convenient.

Even if you’re OK with your current rates, consider comparing rates every year or two nonetheless. You will never know if you could pay less until you shop around.

Stacy wrote in his article that he shops around for home and car insurance one year and health and life insurance the next year. So, he checks up on each policy every other year.

My household hadn’t shopped for car insurance in nearly three years, so we were overdue. If you, too, haven’t compared rates in a while, check out Stacy’s article for all the policy factors you might want to consider. Then, start shopping.

What’s your experience with trying to lower your car insurance premiums? Share with us by commenting below or over on our Facebook page.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Karla Bowsher
Karla Bowsher
I’m a freelance journalist and former newspaper reporter who has covered both personal and public finance. I've worked for a top 50 major metro daily and a community newspaper as well as ... More

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