How to Keep Lowering Your Auto Insurance

You got your low rate. Next time, make it even lower.


Last day. We're through the hard part (whew!) and all that's left is to wrap things up a little and leave you with some long-term money-saving strategies.


Hopefully you did some comparison shopping yesterday. That's going to be the single best way for you to lower your insurance bill right away.

We also hope you're leaving today with a better and more confident take on insurance in general, including being more comfortable with your coverage levels. (Maybe you even adjusted them to fit your financial situation and lifestyle a little closer). Feeling comfortable with your coverage is half the battle.
The other half is, of course ...

Getting your policy at a reasonable price.

We're going to assume you shopped around for quotes this week, and that you found a lower priced policy than you've already got. Great!

Now let's take a look at how to keep saving money on that policy over the next few years:


Your driving habits.

  • Drive safe. Safe drivers (those with no points on their record for the last three, sometimes five, years) earn huge discounts on auto insurance, and with good reason. One speeding ticket increases the chance you'll be involved in an auto accident by almost 100%! It's no wonder insurance companies reward safe drivers.

  • Drive less. We know not everyone has a lot of control over this one. But if you can manage it, lowering your annual mileage usually means a decrease in premiums. It's the simple laws of probability: the more time you spend on the road, the greater your chances of being involved in an accident.


Your car.

This isn't something you'll likely be changing on a whim. Still, it's a good thing to keep in mind whenever you're shopping for a car. Insurance companies charge higher rates on cars that are more dangerous, more costly to repair, or very popular (read: preferred by thieves.)


If you're looking at new cars, keep in mind that those with extra safety or anti-theft devices are good for both your piece of mind and your pocketbook. Airbags, automatic seat belts, antilock brakes, car alarms, and satellite locator systems may all lower your premium.


And, if you have a teen-aged driver, for heaven's sake, make her drive a safe, older, inexpensive car.

Your credit.

This is an area you should try and keep in top shape just because it will make life easier in general. Your credit rating is everywhere you turn these days - it even affects insurance rates. A lot.

And while it may seem unfair that your credit should affect your auto insurance (after all, the two aren't related at all, right?) statistics have shown a relationship between paying bills late and filing more auto insurance claims. The theory is, if you're careful in one area of your life, you're more likely to be careful in others as well. And most insurance companies will charge higher rates to drivers with poor credit.

There is, however, a growing movement to ban the use of credit information by insurance companies. Washington state, for example, recently passed a law that would make this practice illegal, and other states are following suit.

You can go a long towards insuring that your credit stays good (or improves), by being proactive and checking your credit report and score on a regular basis. ConsumerInfo offers a one-year subscription to its credit monitoring service, which you can try out, at no cost, for 30 days.


Keep shopping.

Now that you've taken care of it once, make it a habit. Test the market every once in a while. Your rate may be the lowest out there now, but all that could change in a year or two. (We know - it just never stops.)


One last word to the wise:

Choose your auto insurance company with care. This can't be stressed enough. No matter how long you spend designing the perfect coverage, and shopping for a low rate, it won't do you a bit of good if your insurance company can't or won't pay your claim.

After you get your quote, but before you buy your policy, check out the insurance company's rating with A.M. Best or Standard and Poor's. You'll get a quick and trusted appraisal of their financial reliability. It will take only a minute, and it could save you a lot of money. (Our favorite insurance shopping service, Insweb, gives you these ratings online before you get your quote.)

And don't buy insurance from any provider who solicits you without invitation, or who offers impossibly low premiums. (Less scrupulous insurance providers often "hook" you with a low premium that jumps sky high a few months later.)

Most big-name national companies are safe, but check out their financial standings yourself. After all, it's not insurance if it isn't sure.

Well, you're all set. We hope you found the course helpful, and happy driving!

Want to learn even more?

Take our quick auto insurance course, and learn the step-by-step to get the most out of your auto insurance policy for the least amount money.

Just ten easy lessons - start today