3 Tips to Save on Auto Insurance

Besides your house, what is one of the most expensive things you own? For many people it’s their car. Unfortunately, unlike your home, cars will depreciate in value over the years (unless you have a classic car or a rare car of some sort, then those may appreciate in value over the years). The more you use the car, or the more mileage you put on it, the less its worth.

According to Statistia, there was approximately 218 million drivers on the road in 2015 with approximately 263 million vehicles registered. Aside from purchasing the car, the other big expense associated with car ownership is insurance. Yes, there is maintenance and other costs too, but insurance normally equates to more than the maintenance costs you put into your car if you added up all the insurance payments you make from day 1 to the end of the car’s use. Again, there are always exceptions, but the bottom line is that auto insurance is expensive! I’ve got good news for you, though! There are things you can do to reduce that costs and these 3 tips can save you anywhere from 10% to 40% on your annual insurance premiums.

Tip 1: Consolidate Your Policies

This is an easy one and, depending on the company, it can take as little as 5 minutes. How many of you have your auto insurance with one company and your home or renter’s insurance with a different company? I don’t have an exact number on this one, but it’s more than most people think.

My husband is the perfect example; he had his auto insurance with Geico and our home insurance with State Farm. He never thought to ask the other company if they could beat the competitor’s price if we bundled home and auto with them. It wasn’t until one company called and left a message saying they would reduce our home insurance by 40% if we bundled with our auto insurance. He thought the offer was too good to be true, so he went and visited with the agent who left him the voicemail. She explained to him that combining our home and auto policy enabled us to receive more discounts that weren’t available to us before. She explained that auto insurance is riskier than home insurance because drivers are more likely to have a major loss event with their car than they are their home, so combining insurance policies helps reduce the risk to the insurance company, as well. Plus, some of our own research confirmed that the insurance companies also make more money on the multiline policies than they do on insuring cars or home individually.

If you have policies with different insurers ask if they can reduce your costs if you combine. Don’t forget to ask each company and be honest with them, if insurance company A is giving you a better quote to consolidate than company B, tell company B. Sometimes they will match or even beat the competitor’s quote to get your business.

Related Post: Why I Bought a Luxury Vehicle

Tip 2: Consider a Tracking/Monitoring Device

I know it sounds crazy. Why the heck would you ever do that!? Well, for one, insurance companies offer significant discounts if you agree to install a driver monitoring device. If you are a safe driver with normal driving habits this device can save you some serious cash. Also, if you truly are a safer driver, what do you have to hide?

If you do agree to have one of these devices installed the process is simple. You normally receive a small computer chip that can be plugged into your car’s computer system, which typically sits somewhere under the steering wheel on the driver side. This small wireless device is attached to your car, letting the insurance company monitor your driving habits, including distance, frequent travel times and driving habits, such as sudden stops or speeding.

The amounts you can save vary depending on your driving data which is recorded and analyzed by the insurance companies, but most insurance agencies offer significant discounts. For example, Liberty Mutual offers the following, “receive at least a 5% discount immediately and up to 30% on your auto insurance after only 90 days.” 35% might be worth it if you’re a good driver and some of the other insurers offer even more. If you haven’t considered it, and you are truly a good driver, it’s worth at least asking your current insurance provider how much you could potentially save if you sign up for the monitoring device.

Tip 3: Take a Defensive Driving Course

Most insurance agencies offer some type of defensive driving course to help you save money on your auto insurance. My husband and I have Geico insurance and we are currently taking a 6-hour accident prevention course that is online and can be completed on our own time, as long as we finish it within a month. Once we complete the course, we will save 10% per year for 3 years per driver (so 10% off for each of us). The cost of the course was $24.95 for each of us, but our savings over 3 years will be significantly more than that. Although a 6-hour course may sound like a nightmare to some, it’s not a bad tradeoff to get 10% per driver for 3 whole years!

Each state has different laws regarding auto insurance and different courses that may help reduce your auto insurance AND reduce points on your license. Check your local DMV website and/or check with your auto insurance company to determine what discounts may be available to you. It’s totally worth a few hours of your life spread out to obtain a discount over the course of 3 years (or whatever time-frame is applicable for you)!

What kind of tricks have you used to help reduce the cost of your auto insurance?

34 thoughts on “3 Tips to Save on Auto Insurance

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  1. Additional tips I’ve used and that I would suggest include eliminating medical insurance (for you) If you have health insurance from say your employer. I personally don’t pay extra for a rental or having a repair service on call and the last one is increasing my deductible from $500 to $1000. These three things have saved me a significant amount of money and they work for me. I could see where some folks might feel uncomfortable with my suggestions and I guess we all need to make decisions that give us peace of mind so no harm done on disagreeing.

  2. Great ideas! I’ll have to call Geico to see if taking a course will help me get more discount. They already told me a while back that I’m getting all available discounts which I checked online. But there are always ways companies offer more incentives to entice new customers and convince existing ones to stay. 🙂

  3. Yes – bundling is crucial. I’m always shocked how much people can save from bundling. I don’t blame you husband for doubting it, because it caught my eye seeing how low the policy prices can go.

    One thing I’m considering doing is shopping around my insurance once per year. By shopping, I’m hoping to achieve lower prices through price matching. I won’t sacrifice too much quality, but keeping your cost low by continuously shopping around is never a bad route to take.

    It is a necessary evil, but it doesn’t have to be as bad of a cost as it is!

    Take care.


  4. I would add that you should shop around if you’ve been with the same insurance company for years. They may have been the best option when you first signed up with them but there may be better deals available elsewhere.

  5. I appreciate you pointing out that each state has different laws regarding auto insurance and different courses that may help reduce the auto insurance and reduce points on the license. My daughter will be getting her first car soon, but we will do that after moving to another state. I will make sure to check the necessary laws there which might change the insurance costs.

  6. I appreciate your tip to bundle your policies together to save money. I didn’t realize that you could consolidate your auto and home insurance to get discounts. I am trying to find ways to save money on my auto insurance, and that seems like a great option! I will have to look into it.

  7. I thought it was interesting that you mentioned considering a monitoring device. My brother is looking to get auto insurance on his new car. I’ll be sure to talk to him about maybe getting a monitoring device so he can keep the price low.

  8. My son is going to be turning 16 in the next couple of months. He’ll be needing to get auo insurance if hes going to have a car, so the tips you provided could all be helpful to him. I’m sure he wouldn’t mind taking a defensive driving course like you suggest to help ensure he gets a good rate on his insurance.

  9. I have long been paying for my annual auto insurance premiums, but I didn’t know that I can actually save money on it! Installing a driver monitoring device on my car to get significant discounts makes sense to me. As you mentioned in this article, I can potentially save a serious amount of money if I am a safe driver with normal driving habits! I think it’s worth a try just to be able to reduce the cost of my premium.

  10. I wanted to buy a car to take my kids to school and get to work since using the public transportation proves to be a lot tricky when you have an energetic 7-year-old with you. It is good to have all your policies with one company so wouldn’t have to call and go to a lot of places when you need to file a claim, plus, like you’ve mentioned, there are companies that give discount packages for different insurance policies that they offer. I think your suggestion about taking a defensive is absolutely brilliant because not only does it give you savings on your insurance premium, but it is also beneficial for critical times especially if you’re driving with children with you.

  11. My husband and I have been sharing one car for a while now. It was fine when we didn’t have kids, but now it’s starting to be a lot more difficult trying to drop him off at work, pick him up, and do all the errands with just one vehicle. We’re looking into buying a second car. If we do buy a second vehicle, we’ll want to make sure we find the right insurance policy. I like your tip about seeing if there’s any type of discount given if you take a defensive driving course. I also didn’t know that you could get a discount if you have some type of tracking device installed. I’ll have to ask about this.

  12. I liked that you had mentioned that it could be helpful for your insurance to take a defensive driving course to save some money. My wife and I have been looking into getting a better insurance company that could help us out with our current financial state. We’ll have to look into taking a course and hopefully, we’ll be able to find a company that works great for us and saves us some money.

  13. Thanks for mentioning that a lot of auto insurance companies will give you discounts if you install some kind of driver tracking device. My husband and I have decided it is time to look for some new car coverage and we are wondering how to make it as cheap as possible. Since we are both very safe drivers, we will definitely be getting some monitoring devices to lower our auto insurance rates.

  14. It’s good to know how to save on car insurance. I didn’t realize that a tracking device could actually help us save money, depending on the data we get. I feel like I’m a pretty good driver, so I’ll look into this!

  15. I appreciate you sharing some of your ideas on how to save money on your auto insurance by consolidating your policies. One thing that you said that I really liked was that you should look to get your auto and home insurance from the same company to save money. My girlfriend and I are looking to get married, and I think that this information would be really important for us when we create a budget for ourselves. Thanks!

  16. It’s good to know how to save on car insurance. I had no idea that taking a driving course could save us around 10% per year. We’re pretty tight on funds, so that 10% could come in handy!

  17. These tips sound good! Also, if you have a second motorcycle or planning to borrow your friend’s for a short trip, instead of paying a full year’s insurance premium, you can opt for temporary motorcycle insurance. You also need to make sure the company you choose is a reputable one and always keep in mind that the “cheapest” price isn’t always the “best” option.

  18. Thank you for all the tips on how to save money on your car insurance. I need to get auto insurance soon and I would love to save some money on my policy. I think that is a great idea to see to ask our insurer if we can reduce costs by combining our policies.

  19. My son will be needing auto insurance soon, so I appreciated the tips you provided on how he can save on his rate. I really liked your suggestion for him to take a defensive driving course. I’ll do some research about what the course entails based off where we live so he can look into taking it and save on his auto insurance premiums.

  20. I value your tip to choose a policy that you can afford and that will cover a lot of what you need. Thanks for mentioning how you won’t want to take many risks when it comes to serious things such as insurance. My husband and I are looking into getting auto insurance for our new family car; thanks for the tips on saving and making good decisions.

  21. That’s cool that you can take a driving course to get cheaper rates and that the DMV’s or your insurance company’s website will tell you what is available. I’m going to be needing new coverage soon, and I’d like to shop around a bit before I pick something. I think that I’ll have to find a good auto insurance company to get coverage from that does offer discounts like that.

  22. Why doesn’t anybody talk about getting the diminished value check from insurance? The simple fact that a car has been in an accident and repaired means it is worth less than an identical car that has never been repaired. You should always ask about diminished value. The worst that can happen is they say no.

  23. Thanks for the tips on how to save on car insurance, I had no idea there were so many things you could do to save on car insurance. I never took into account the fact that consolidating your policies could save you money, although it makes sense when you think about it. My brother is looking to get insurance for his daughter before she starts driving, I will be sure to share these tips with him.

  24. It sure was nice to know that there are some insurance agencies that will offer accident prevention courses are defensive driving courses so that the person will be able to get a discount. I hope that the company that I have chosen offers this because I really want to get a discount on my car insurance. Though I already know that I am a safe driver, it can’t hurt to give this a try if it will guarantee to benefit me eventually. Thanks.

  25. It sure was interesting when you said that most of the insurance companies around will offer a defensive driving course just so their clients can save money on the insurance. I do not mind doing that since I have a lot of time on my hands after all. Apart from this, I am also eager to get a discount on the insurance regardless of how small that discount might be. If being a safe driver will ensure this, then I will be.

  26. If you own a convertible, then auto insurance is the must. I think you will be glad of having this insurance scheme after encountering an accident. But the fact is, nobody wants to spend more hill of beans than necessary on the policy. I don’t think there is a problem with it. In fact, no one should be ashamed of this thing. Because for me, it’s a part of budgetary “ auto care- https://emcnv.com/european-motor-car-repair-service/ ”. I would like to tell that- by choosing the right insurance scheme, taking the benefits of auto insurance discounts, driving safely, owning a vehicle which is relatively cheap to insure, improving the credit, and increasing the deductible- you can definitely save a penny on your vehicle insurance.

  27. I appreciate that you explained that a defensive driving course will be able to lessen the rates. Like you said, there are laws in each state that requires the companies to reduce the rate when the driver has proven that they are safe. I will keep that in mind and get this kind of course before buying my own car this year since I need to look for ways to cut costs after spending a lot for the house renovation last year.

  28. I like how you mentioned that when getting auto insurance, it’s a good idea to use the same company as other insurances that you have. My husband and I are thinking about buying our first car and need insurance. I will definitely keep all of your great tips and information in mind when deciding what auto insurance I should get.

  29. I had no idea that most insurance agencies offer some type of defensive driving course to help you save money on your auto insurance. My husband and I are working on getting our first car, and need auto insurance, but have no idea how to go about it. I will definitely utilize all of your great tips and information when trying to get the best auto insurance possible.

  30. I would like to know how I can save money on auto insurance. I like how you mention taking a defensive driving course can help you save money on car insurance. Thank you for the advice. I’ll contact auto insurance and ask if I can take this course just to save money.

  31. I can’t believe that combining policies can take just 5 minutes to complete! That’s relieving because I don’t have a lot of free time and taking an hour to do something like that isn’t an option for me. It’ll be nice if I could save myself a lot of money just by combining policies.

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