Car insurance bills can be a costly addition to your monthly or annual expenditure. Often, several people end up paying for their expensive policies by jumping through several hoops. That is the reason most people go on their computer searching ‘cheap auto insurance near me.’
Everyone wants cheap car insurance rates that will still get them the same amount of coverage as the more expensive options. But how do you go about getting these cheaper insurance rates?
You first have to know and understand the various factors that can affect your average car insurance policy’s rate. These factors include
The type of vehicle you drive,
Your driving record or history,
The amount of mileage you get in the car,
Where you park your car – in a locked garage or out on the street,
What state or city you live,
How old you are,
Your credit score.
The number of cars you are insuring under one policy can also affect the kind of quotes you will get from insurance providers. Many companies run a discount for this purpose, but more on that later. Many other factors can affect your insurance premium rates, depending on the terms set by the insurer.
Now let us talk about 15 ways you can get cheap car insurance quotes.
1.) Compare as many prices as you can.
If you aim for cheap car insurance quotes, you ought to know that you have to compare as many prices as possible. While you might already have a provider, do not just assume they are giving you the lowest prices in the market.
Big insurance companies are the most popular options among clients. But smaller insurance companies in your local area might offer you much better deals on your insurance premium rates. You might never know if you never take the time to find out.
Make use of price comparison sites (such as Compare.com) to compare insurance rates and get the cheapest coverage for your car. Comparison sites are not always reliable. So make sure that you review and double-check your current policy.
You can also go ahead and compare prices with your friends, family members, and coworkers. Doing this will give you a framework of comparison to work around.
For all you know, cheap auto insurance quotes might just be down the block from you.
If you find a cheaper option than your current provider, you can decide to jump ship or renegotiate your policy’s terms if you are comfortable with your current provider.
You should also remember that cheaper is not always better. If the cheaper policy is not as good as your current policy, it would explain the price difference. Make sure that you are getting the best possible coverage for the most affordable premium rate.
2.) Choose yearly payments over monthly payments.
Insurance providers are known for offering you two payment methods. You can either choose to pay monthly or at once each year. If your goal is to get cheap insurance rates, then paying per annum is the best way to go.
It is the most effective way to save on your insurance premiums.
It might seem more attractive to pay monthly and spread the cost, but do not fall for it. Making monthly payments will end up costing you more in the long run.
Why is this so?
When you pay monthly, it counts as a loan from your insurer. And as with all loans, you are charged interest on this sum. The rates may be lower or higher than the competitor, which might still not be the cheap car insurance rates you are looking for.
So how much could these rates cost you? Recent surveys reveal that the current interest rate is at least 25% of your initial sum. Some insurance companies can charge as much as 36% as interest.
For example, if your insurance quote is about $2000, spreading this over a year might add at least $500 to your payments. However, making one annual payment would need you to pay only $2000 once, and you are covered for the whole year.
To avoid situations like this, making annual payments is your best bet. If you are unable to afford the annual payment for your insurance, then make sure you compare monthly premiums across as many providers as possible.
3.) Your credit rating should be as high as possible.
Credit ratings have massive impacts on the kind of quotes you will get from insurers. Insurance companies run what is called a ‘soft check’ on your credit record before giving you a quote. They do this to confirm any personal details that you might have given to them.
If you choose to apply for car insurance with them, they will then perform a ‘hard check’ on your credit record. This action will help the company determine whether or not to provide you with car insurance.
Keep in mind that any ‘hard check’ will reflect in your credit records. This will affect the ways other potential lenders will treat you in the future.
To get cheap car insurance quotes, you should make sure that you do not have a low credit record. Doing this will greatly improve the conditions of any policy you might get from your chosen provider.
Having a poor credit score does not necessarily stop you from getting insurance quotes. Instead, you might end up having to make an insurance deposit before being offered any form of coverage at all. Some providers might even make it impossible for you to make monthly payments.
FICO scores lower than 580 are generally considered to be poor credit scores. Insurers may use this rating system or theirs to determine your credit status. If you are regarded as having a poor credit score, then you will have to pay much more as your insurance premium.
Find out more on credit reports here
4.) Aim for higher deductibles.
A deductible is the sum of money you would have to pay out of your pocket before your insurer comes in. Logically, it follows that higher deductibles will get you reduced premium rates. Therefore, raising the deductibles on your insurance is a great way to get cheap car insurance rates.
Deductibles can range from between $250 and $1000. This the most common range typically offered by many car insurance providers. Your insurer may have a wider or shorter-range depending on their mode of operation.
Discuss your deductible with your provider before deciding on how much you want your deductible to be. Certain insurers will let you shave off several percentages off your premium rates if you go for a higher deductible.
Filing smaller insurance claims with your provider can also push up your insurance rates. Higher deductibles also come in handy if you are not willing to fill small claims. It keeps your rates low and leaves your insurance coverage for more expensive situations.
While higher deductibles can get your cheaper rates on your car insurance, keep your financial situation in mind when picking what your deductible will be. It is good practice to select the highest possible deductible that does not inconvenience you financially.
5.) Spice up your job title.
Having the right job title can make all the difference when getting insurance quotes. There is a big difference between kitchen staff and a chef. In the same way, a writer is not the same as a journalist. Even if you are a stay-home housewife, present yourself as a homemaker instead.
Why does this matter?
What you present your job or means of living makes all the difference. Insurer providers consider this among many other factors when deciding what kind of quote to give you.
If you can label your job differently when inputting your occupation, please do. This will impact what your final insurance premium will be.
High-risk job holders are also more likely to pay more on their insurance. So if you work at a high-risk job, then you should expect that your premium might be higher than that of those around you.
Take care to make sure that you do not lie when you are providing your details. Do not present yourself as something that you are not. Do not tell your provider you are a farmer if you are a baker.
That is an act of fraud. You might end up being prosecuted. The prosecution will end up costing you way more than an insurance rate.
6.) Auto Renewals are not always the best option.
Always keep your renewal date in mind. Letting your provider take care of automatic renewals can be quite convenient. But this convenience usually comes with a price, especially if you have been stuck with the same provider for years.
Your insurance provider will always look out for their interests. While they might be automatically renewing your policy, this will not be the best offer they have. You end up with a coverage that benefits your insurer more than it benefits you.
While this might seem unfair, keep in mind that they are running a business too. They are trying to keep themselves ahead of the market and the rest of the competition. So when the company realizes that you are comfortable with them, they start raising the premium price slowly.
Make it a habit to review your insurance policy regularly, maybe after six months since the last check. This will help you quickly spot the price differences in your policy.
So instead of using auto-renewals on your policy, haggle. Haggling will most times reward you with cheap auto insurance quotes.
Suppose your insurer refuses to offer you a cheaper rate, no worries. Take your business elsewhere. Competitors will most likely give you the cheap rates on your car insurance that you need.
7.) Less coverage does not mean cheaper rates.
When you are choosing the amount of coverage you want on your car, you might find that picking less cover is not cheaper than picking more. In fact, in some situations, more cover means cheaper rates.
Car insurance usually comes in the forms of comprehensiveness; Comprehensive, TP (Third Party and TPF&T (Third Party fire and theft). In a bid to reduce premiums, drivers might end up picking less coverage. This is a poor strategy and often ends with them paying more.
You should make sure to compare the prices across the coverage options. Sometimes, contrary to what you might expect, comprehensive covers cost less than the other two options.
Insurers do this because your premium rate is also subject to how much they would have to pay you in claims and not only to how much coverage you have.
Note that in cases where comprehensive insurance policies are excessively purchased by clients, insurers tend to raise the price of these policies. It is just enough to keep in mind that less coverage does not translate to lower costs. Remember this when you are deciding on cheap car insurance quotes.
8.) More cars equal more savings.
If you own more than one car, you should get multi-car insurance. Many offer multi-car insurance as a means of saving money for their clients. So why not take advantage of this and save up some insurance money.
The conditions of multi-car insurance differ from insurance company to insurance company. Some companies have policies designed to cover more than one vehicle. Others choose to let you link up your cars under one policy to earn yourself a discount on premium rates.
Think of it as bulk insurance rates. It is a strategy that insurance providers employ to make sure they get your business. In some situations, you might even be allowed to dictate the terms of the coverage on your cars.
Multi-car insurance is effectively cheaper than having to take out a policy on each car separately. And as an advantage, you end up working with just one insurer. While this is a great way to get cheap car insurance rates, you should note that prices are still relative. If your insurance provider is naturally more expensive, then its multi-car insurance policies might still be quite expensive. Make sure to compare prices before deciding on which policy to settle on.
Note that some providers require the drivers of insured vehicles to be related either by blood or by marriage. Some even go as far as demanding that drivers live in the same house. Two unrelated drivers can qualify to operate under the same policy so long as they are co-owners of the car.
Ask your provider about the terms of their multi-car insurance policies.
9.) Cheaper cars cost less to insure.
A vast majority of people consider maintenance fees and fuel consumption rates when buying cars. A few remember to consider insurance rates.
It should come as no surprise that cheaper cars cost less to insure. After all, they worth less than fancy sports cars and luxury vehicles.
Insurers take the make and model of your vehicle into consideration when giving you an insurance quote. These two things go a long way in deciding how much your insurance will cost.
Before buying a vehicle, you should try to get quotes on it. This will give you an idea of how much you might have to pay for insurance when you finally buy the car.
This might not seem so important now. Just keep it in mind that insurance is part of the extra operating costs on your vehicle. This will greatly influence what your annual spending will look like.
So consider getting a cheaper car that will serve the same purpose as its more expensive counterparts. This will get you the cheap auto insurance quotes you want.
Larger vehicles also cost more to insure. While they might not be as expensive as luxury cars, insurers still charge more for insurance covers on them. If you do not need a large car, then opt for a smaller car instead.
Also, some insurers give lower rates on hybrid cars and alternative-fuel cars. You will most likely earn a discount if the car is considered environmentally friendly.
10.) Keep an eye on your car modifications.
Insurers keep an eye on any modification that you make to your vehicle. And so should you.
Well, they go a long way in determining your insurance premium rates. Modifications will raise the value of your car. And as the value of your car goes up, so does your rates.
Also, modifications are not just the ‘wings’ on the back of your car. No. Simply getting alloys to improve the general outlook of your car is considered a modification by most insurance companies.
So before you make any changes to your car, discuss this change with your insurance provider. This will help you avoid being cut unawares by a sudden spike in your premium rates.
However, modifications are not all bad news.
If the modification is for protection, like an anti-theft alarm or tracking device, then your rates might end up going down. Discuss this at length with your insurer. Some insurers have preferences for what sort of device might earn you a reduced rate and which devices do not.
11.) Older cars do not always need collision and comprehensive coverage.
Collision coverage offers you protection in case of single-car accidents or collisions with another vehicle or object. Comprehensive coverage covers you for non-collision related events such as fire, theft, or natural disasters. Including these two coverage options usually means you are covered for repairs or will be reimbursed for the value of your car.
In most cases, these coverage choices are optional. When you are leasing or financing your car, the lender might require that you get them.
The value of your car determines the payout on this coverage. Older cars are usually worth much less than newer model cars. So having these options on an older model car might not be a good idea.
Depending on your particular situation, you may choose to opt for cheaper versions of this coverage or completely take them off your policy. To help guide your decision, weigh the book valuation on your car against the coverage options deductibles and the annual cost of these coverage options as given in your insurance quotes.
You can use tools (like this and this) to help you ascertain your car’s value.
12.) Ask about discounts.
The insurance industry is no stranger to discounts, even though many providers do not talk about them much. To get them to talk about discounts, you will have to ask your insurer what discounts are available to you.
Many insurers offer several types of discounts. Some even let you stack up on some discounts.
You can look forward to cheap auto insurance quotes through discounts if you are
- A military officer or personnel.
- A student with excellent academic records and good grades.
- A Veteran.
- An accident-free driver.
- A driver who has taken accident prevention, defensive driving, or other related courses.
- A retired or active federal government employee.
- A driver with multiple cars insured by one provider.
- A driver that has bundled car insurance with the homeowner or renter insurance.
- A driver with protection devices (such as anti-theft alarm systems, anti-lock brakes, airbags, etc.) installed in their vehicles.
- A driver with a history of annual or regular premium payments.
- A driver affiliated with preferred groups or organizations.
- Agreeing to receive your documents online.
Ask your insurer about the conditions surrounding their discounts to find out how best to maximize your savings. While discounts seem attractive at first glance, remember that your goal is ‘cheap auto insurance near me.’ So, compare prices with and without discounts before deciding on a particular insurance provider.
Also, try talking to your friends and family members about your car insurance. They might reveal hidden discounts with a particular provider that you are not aware of.
13.) Safe driving will earn you reduced rates.
Most drivers do not know that this is the easiest way to get cheap car insurance quotes. If you have a record of safe and accident-free driving, then your insurer will be motivated to give you cheaper rates than normal.
So if you are a careless driver, improving your driving’s safety standards can go a long way in getting you cheaper insurance rates. You can opt to have your insurer install a tracking device (black box or telematics device) in your car to confirm the improvement in your driving skills. This information will be transmitted directly to your insurer to get you cheap auto insurance rates.
You can also decide to name a more experienced driver on your policy. Insurers are motivated to lower rates if the driver has a lot of experience with driving as compared to newer or younger drivers.
If you are a new driver or younger than 25 years, consider asking an older driver (parents or older siblings) to be named on your policy as well. This will encourage your insurer to provide you with a lower rate.
You can also consider opting for public transport unless it is necessary. Not only does this help you save on fuel and other car-costs, but it also logs fewer miles in your car. Insurers consider things like those when deciding on your rates.
Try to keep your logged miles as low as possible to get the best possible deals on your car insurance. This, along with a record of little to no claim, will earn you a bonus and reduce your rates.
14.) Consider using a broker.
Still cannot get the cheap auto insurance quotes you want? Then using the services of an insurance broker might not be a bad idea. They will assist you in finding the best possible car insurance deals.
Note that there are fraudulent or ‘ghost’ brokers out there, perhaps even more than actual brokers. They prey on those that have gotten desperate about finding the cheapest car insurance rates.
You will most likely come across such brokers on social media platforms, online market spaces, money-saving forums, and student websites. These are also places you might go to find advice on how to save on your insurance payments, so keep a watchful eye out for such fraudulent brokers.
You can determine whether a broker is fraudulent or not by the content of their policies. They are usually prone to just switching out details in their policies without care for other ones.
Other telltale signs are:
They offer you a guaranteed price on your insurance even before you secure a quote.
Their websites are not formal or professional-looking,
They only offer a cellphone number as their means of contact,
And of course, the offer is too good to be true.
If you are still unsure about the legitimacy of a broker, check if they are registered with the proper authorities. This will help you avoid getting scammed or missing out on a deal that would save you a lot of money on car insurance.
15.) You might not need all those add-ons.
Car insurance policies come with a lot of add-ons that can improve the coverage of your vehicle. While they are not straight up wastes of funds, there is a chance you might not need all of them.
The more add-ons you have on your policy, the higher the chances of your getting a higher premium rate quote. Your add-on choices may pile up hundreds of dollars on your premium rates.
So take your time to go through the add-ons on your policy and sort out which ones you need and those that you do not need. A good rule of thumb is to consider your financial capability when doing this. Keep in mind that cheap is relative so, if you consider the coverage cheap enough and affordable for you, then keeping all the add-ons might not be such a bad.
Frequently asked questions (FAQ) about car insurance.
Which insurance company should I go with?
There is no general rule of thumb to guide your choice of an insurance company. Getting cheap auto insurance quotes from a company is a good criterion for choosing your insurer. But you should also take note of other factors such as proximity to you and the speed at which they pay out claims.
It would make little sense to get very cheap car insurance rates but have to wait for years before your claims can be processed.
Do price comparison sites affect my credit record?
If you are applying for a monthly payment deal, using a price comparison website can affect your credit record. But keep in mind that this is the same situation as asking for a quote from an insurer. This is because both comparison sites and insurance companies do soft checks before giving quotes to potential customers.
Nonetheless, soft checks usually do not affect your credit record. The check will only reflect in your credit file that is visible to only you.
Can you truly trust comparison websites?
Comparison sites are usually sorting through thousands of policies from just as many insurers. Understandably, there will be situations where they will make mistakes. However, it is quite rare for a comparison website to get it wrong.
You can have almost complete faith in the data on a comparison website. Just to be sure, you should take the pain to examine the content of any policy before you commit to it.
While the price is an important criterion for choosing your insurer, you should also take the reputation of your provider and the terms of your policy into account. Cheap rates might not get you the best coverage that you need in your car, so examine your policy as carefully as possible.
Cheap car insurance rates might be much closer than you know. Keep your eyes and ears open, and you might learn about cheap auto insurance rates that are perfect for you. Landing these great deals will give you bragging rights among your friends and family.