Driving on a Budget: How To Lower Your Premium Without Cutting Coverage
Your car insurance is an essential monthly expense, but a high premium can put a serious strain on your budget. So how can you get a lower car insurance premium without skimping on the coverage you need? Read the Freeway guide below to learn the cheap car insurance tips you need to know to get affordable auto insurance that still meets your needs.
Why Car Insurance Costs Keep Rising for Many Drivers
It can be hard to keep full coverage on a low income, especially with premiums constantly rising. If you want to learn how to save on car insurance, it helps to understand why your premiums are always going up.
Inflation and Repair Costs
Inflation is one of the main reasons that auto coverage is so expensive. When the cost of living goes up, all of your bills go up — including car insurance. Inflation has made everything more expensive, and insurers need to increase premiums as their costs increase. In particular, the cost of repairs has increased significantly in recent years. Along with other factors, insurers have to factor in parts, labor, and their general cost of doing business into their premiums.
High-Risk Zip Codes and Their Impact
Certain areas are being hit much harder than others when it comes to auto coverage prices. If a zip code experiences a spike in accidents and claims, insurers will raise premiums for pretty much everyone in that zip code. Typically, big cities are a higher risk than others, but new construction, traffic changes, and population spikes in less populated areas can cause price hikes in any zip code.
Ways To Lower Your Car Insurance Premium Without Losing Protection
You want to lower your car insurance premium, but you don’t want to skimp on the coverage you need. So, what can you do? Luckily, there are a few different ways you can decrease your monthly costs without foregoing essential parts of your budget auto insurance plan. Here’s how to lower your premium the smart way.
Adjusting Deductibles Smartly
Many people just go for the default deductible option when setting up their auto policies. But opting for a higher deductible could save you money in the long run. When you opt for a higher deductible, insurers will give you a lower premium in exchange. As long as you set aside enough money to make sure you can cover the deductible in an emergency, you can enjoy your lower premium without decreasing your policy limits.
Reviewing Add-Ons You May Not Need
Certain parts of your auto policy are simply non-negotiable, but there are some add-ons you might not need. For example, you could forego rental reimbursement if you have alternative transportation in the event of an accident. Carefully review your policy to make sure you only pay for the protections you’ll actually use.
Taking Advantage of All Possible Discounts
Insurers have all kinds of savings programs that you may not be aware of. Car insurance discounts vary from carrier to carrier, but here is a chart with just a few of the options to explore and how much they may save you.
| Discount | Possible Percentage off Premium |
| Policy Bundling | Up to 14% |
| Good Student | Up to 15% |
| Professional & First Responder | Up to 20% |
| Good Driver | Up to 30% |
| Senior Defensive Driving Course | Up to 15-35% |
| Green/Hybrid | Up to 10% |
| Military | Up to 15% on base, 90% deployed |
Even if these car insurance discounts aren’t publicly advertised, they may still be available in your area, so be sure to ask. Your agent will be able to explain which options you qualify for and how you could become eligible for additional discounts.
How Your Driving Habits Influence Premiums
The way you drive also directly influences your auto premiums. It makes sense: The safer you drive, the less likely you are to be in an accident, and the less likely you are to make a claim.
Mileage, Commute, and Telematics Programs
The more time you spend behind the wheel, the more likely you are to get into an accident. In fact, many insurers offer low-mileage discounts for people who drive less than average. If you’re an infrequent driver, inputting your commute and average mileage could help you get a deal. Telematics apps and programs can also help, as they track your driving habits and offer proof of your low mileage.
Avoiding Common High-Risk Behaviors
Many telematics apps and programs also identify poor driving habits. Plus, driving dangerously can increase your chances of getting into an accident or receiving a ticket, both of which can cause a premium hike. Stay off your phone, make sure you brake and corner smoothly, and drive the speed limit at all times to ensure your driving history stays sparkling clean.
Why Comparing Quotes Matters More Than Ever
Shopping around is one of the best ways to save money on your coverage and secure a lower car insurance premium. By using a few basic coverage comparison tips, you can make sure you aren’t overspending on your coverage.
Price Differences Between Carriers
Carriers will have different price points for the same level of coverage. Many people just renew their policies automatically without realizing they could be getting a better deal. In many cases, paying a higher price won’t even get you better customer service or higher payouts, so it’s a good idea to look for reputable carriers who also have low prices. Switching carriers is often the best way to get a deal. At Freeway, we offer knowledgeable, local agents who will do the comparison for you so you know you are getting the best choices.
Hidden Fees and Coverage Gaps To Look For
Some carriers may lure you in with a low quote while actually skimping on coverage or hiding extra fees. Make sure you understand what you’ll be paying monthly, not accounting for introductory discounts. You should also compare plans with the exact same level of coverage to avoid getting skimped on key protections.
Get an Affordable Auto Insurance Quote From Freeway
Securing a lower car insurance premium is a great way to free up some room in your budget each month. By being strategic about your auto coverage and using a few key cheap car insurance tips, you can get the protection you need at a price you’ll love.
Freeway Insurance is the go-to place for budget auto insurance that doesn’t break the bank. With affordable Freeway plans and tons of discount programs to choose from, you can keep full coverage at a low cost. Learn how to save on car insurance and unlock Freeway insurance savings today by calling 800-777-5620, going online, or stopping by an office near you.
FAQs
Here are a few helpful questions and answers to help you learn more about how to lower your premium:
Does Lowering Coverage Always Reduce My Premium?
Lowering your coverage will typically reduce your premium, but there are a few exceptions. If you’re switching to a more expensive provider, your provider increased rates, or you recently got into an accident, decreasing your coverage might not offset the price hike. However, if everything about your driving history and your provider remains the same, reducing your coverage should get you a nice discount.
How Often Should Drivers Shop for New Rates?
Drivers should shop for new rates every time they need to renew their auto policies, which usually happens every six months. That’s the easiest time to make the switch to a plan with a lower car insurance premium. You don’t have to wait for your policy to expire, though, so if you feel like your budget is tight, it’s a good idea to shop around.
What Discounts Are Available for Low-Income Drivers?
Low-income drivers can often qualify for many different savings programs, including discounts for policy bundles, students, safe drivers, and drivers with extra safety features in their cars.
Does My Credit Score Affect My Premium?
Insurers often look at your credit score as one of the factors they use to set your premium, giving better deals to people with higher credit scores. This is because insurers view people with high credit scores as low-risk, and vice versa.
Can Telematics Really Help Me Save Money?
Telematics can absolutely help you save money, especially if you’re a safe driver or if you don’t drive very often. Having excellent driving safety scores or low mileage reduces your risk as a policyholder, helping you maximize your savings.
