Proactive Ways to Lower Car Insurance Rates

October 1, 2013

Let’s talk about cars again. You may have noticed that I’m over that right now. Well, let me tell you why. My brother just bought got a new car, and we’ve been shopping around for insurance rates for him for the last 2 days. Car ownership involves a number of costs to work into your monthly budget, from fuel to servicing and maintenance. One of the costs that can really take a bite out of your finances is auto insurance. Premiums seem to consistently grow higher, particularly for those with a less than perfect credit or driving record. Rather than accept the first sky-high quote that comes your way, it’s important to compare your options carefully and take a few proactive steps to lower your rates.

Install Anti-Theft Devices

Many of today’s anti-theft devices, from GPS trackers to car alarms, have gone down in price to become more affordable. They can also garner you a steep discount on your car insurance rates, particularly if you drive a vehicle that’s more statistically prone to theft. Before you rush out to buy the latest anti-theft devices, however, be sure to contact your insurance company first. They may have a list of preapproved devices that they can give you, so that you can invest in the right technology.

Bundle Insurance Services

If your household has more than one insurance policy, it’s worth asking about bundling these together to benefit from lower rates. You may have multiple cars under one roof, for example. It’s also worth talking to the insurance agent who handles your home insurance, because in many cases they will be able to give you a discount for the added business of your car insurance.

Take a Safety Course

Another way to get a discount on your insurance is to take an additional driver’s safety course. Defensive driving courses can lower your chances of being caught in an accident, making you a less risky proposition to insurers. This is particularly important if you have a less than perfect driving record.

Do Away with Extra Coverage                                                               

You can always increase or decrease coverage depending on your personal situation. If you are driving an older car, you wouldn’t need the same level of coverage as if you were driving a brand new Audi A3 for sale at Carsales. Other situations that would warrant lowering your coverage would be if you have enough in savings to cover repairs, if you have already paid off your auto loan, or if the annual fee for auto coverage comprises over 10% of your car’s value. In these situations, it may simply not make sense to pay for premium coverage when you are unlikely to use it.

Take on More Risk

Along these same lines, you can think about assuming greater risk by increasing your deductible amount. With a higher deductible, you’ll be liable to pay for more of the damage in the event of an accident. Yet you’ll pay less in premiums, and the money you save could be put in an emergency fund to cover minor repairs. It’s best to think this option over carefully, however, and only raise your deductible if you can really afford it.

Finally, always take the time to shop around before you agree to any plan. There are numerous car insurance comparison sites that will show you different prices and coverage plans according to your car’s make and model. Be sure to use several of these for a truly well-rounded view of the options available to you, and don’t be afraid to call the insurance companies directly to ask questions.

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  • Liquid October 2, 2013 at 6:06 am

    Those are some amazing tips. I buy my auto and home insurance through the same broker 😀 It’s more for convenience than anything else. Unfortunately I live in a jurisdiction where auto insurance is run by the public sector and everyone has to buy it from the local government. The good thing is we all pay the same price so it’s fair. The bad thing is we all pay the same price, so we can’t shop around for better quotes lol. #OhCanada

    • Marissa October 8, 2013 at 3:57 am

      Really? West coast, I’m assuming?

      • Liquid October 8, 2013 at 10:55 am

        Yup, Vancouver BC.

  • Daisy @ Prairie Eco Thrifter October 2, 2013 at 9:20 am

    Great tips. I’ve always had problems lowering my rate in Canada, but I know it’s possible. Installing an anti-theft device is helpful. I used to have a car that was on the top of the “most stolen” and “most broken into” lists, and I was told that if I installed such a device, I would get a discount.

    • Marissa October 8, 2013 at 3:56 am

      It’s the little things that help.

  • Kevin Watts October 2, 2013 at 1:31 pm

    I have only thought of the option of installing an anti-theft device. You presented a few great options that could really help and I never thought of taking the higher deductible with lower rate options. It sounds riskier but might be the smartest option in the long run!

    • Marissa October 8, 2013 at 3:56 am

      It’s a bit like gambling.

  • Hayley @ A Disease Called Debt October 2, 2013 at 4:26 pm

    I always shop around every year for my car insurance. It’s worth taking time to do this because rates seem to change so much! A safety course sounds useful even without saving money on insurance. I’m a good driver (I think) but I’d still like to try such a course at some point.

    • Marissa October 8, 2013 at 3:55 am


  • Tara @ Streets Ahead Living October 2, 2013 at 10:23 pm

    Bundling really can save a lot of money. I pay my car insurance through my dad still and they pay a bit more now that they sold their house and lost the bundle discount. I’m trying to get them to switch as Farmers really is too much!

    • Marissa October 8, 2013 at 3:55 am

      Really? I’ve heard good things about Farmers.

  • Matt Becker October 3, 2013 at 9:26 am

    We’ve followed a lot of these, including bundling insurance with one company, increasing our deductibles and getting rid of collision and comprehensive on older vehicles. One thing we haven’t done is switch insurers simply because they offer a lower rate. We’ve had several claims with our current insurer (almost none of them our fault) and they have been amazing every single time. That level of service is important to us and worth paying a little extra.

    • Marissa October 8, 2013 at 3:54 am

      You know, that is always worth the extra few bucks.

  • getrichwithme October 4, 2013 at 11:18 am

    I recently added my father in law to my motor insurance policy.
    The premium actually fell !
    When i asked why – the response was – “hes older and less of a risk than you (I’m 47 he’s 56)
    Maybe its worth adding an older relative to your policy to see if it makes it any cheaper

    • Marissa October 8, 2013 at 3:52 am

      That’s so interesting. I’ve never even heard of that.

  • DC @ Young Adult Money October 6, 2013 at 11:30 pm

    I get my auto and home insurance from the same company, so we do get a discount from that. I am really happy with the service we receive from our agent so we probably are paying a bit more than we could. I know a couple people who bought the cheapest insurance they could and ran into problems when they actually had claims they needed to be covered.

    • Marissa October 8, 2013 at 3:50 am

      I really appreciate my agent, too, and I know he goes out of his way to look for discounts for me.

  • Simon @ Modest Money October 7, 2013 at 8:30 am

    Given the chunk of cash insurance needs take from our pockets, it sure makes sense to look into ways to decreasing ones premiums. I can agree that bundling does help while still giving one a sort of leverage against the insurance company when requesting for rates to be revised down.

    • Marissa October 8, 2013 at 3:50 am

      Totally worth shopping around!

  • Paul @ The Frugal Toad October 7, 2013 at 3:53 pm

    Great tips Marissa! I have bundled my insurance with State Farm for longer than I can remember so I have most of the discounts that they offer. One of the newer discounts available is the GPS enabled Safe Driver Discount. It is only available on newer cars equipped with GPS and monitors your driving habits.

    • Marissa October 8, 2013 at 3:50 am

      That sounds like a great option for those who don’t have a lead foot. 😉