Car insurance rates are climbing — here's what you should do
Inflation may be cooling slightly, but there are certain things — like grocery bills and car insurance payments — that continue to be pain points for Americans.
Car insurance prices have jumped nearly 15%, with premiums exceeding an average of roughly $2,000 annually, a recent analysis shows. Florida motorists reportedly saw the steepest increase. Unfortunately, most insurance companies are forecasting more bumps in 2023. For instance, Insurify's team of experts is estimating another 7% rate hike in 2023.
As car insurance prices rise, drivers may be keen on finding ways to lower their costs. We'll explore some of the easiest ways to do this below.
How to save big on car insurance
You won't have a full picture of how much you could potentially save without comparing costs from other car insurance providers. Trusted online marketplaces can recommend insurance providers to get quotes from. Fill out this survey to get a free quote now.
Progressive, for example, reports an average of $650 in savings for drivers who switch insurance providers.
Mark Friedlander, the Insurance Information Institute's director of corporate communications, recently told CBS Los Angeles that drivers should get at least three quotes per year.
"There are dozens of companies that want your business," Friedlander told the outlet. "There's so much competition out there. [There are] always ways to get better rates."
Don't just choose the cheapest option, though. You'll want to do your research to ensure the provider has a strong reputation. The Insurance Information Institute suggests checking out reviews of companies on your state insurance department website or online consumer information sites.
New York State Department of Financial Services states online that car insurance shoppers should be honest about their driving history, vehicle and other financial and personal data to get the most accurate quote possible. They should also make sure the insurer is licensed to sell insurance in the state and if any business is conducted online it should be on a secure site.
Remember car insurance providers take the following into account:
- Personal information: Age, location, marital status, credit score and more.
- Driving history: Accidents, driving record and more.
- Vehicle: Car's model, make, year, mileage and more.
Fill out some of your personal information about yourself and your vehicle to get a list of suggested insurance providers who can give you competitive quotes.
Other ways to lower your rates
There are several steps you can take to lower costs but research and persistence are key. Here are some other tips to lower your car insurance rates (note: this list is not exhaustive):
- Search for discounts: Review discounts offered by various providers. For example, Progressive gives discounts to drivers with teen drivers (18 years or younger) and students with a B grade point average or better. You may also be entitled to a discount if you haven't had any accidents or traffic violations within a certain time frame. Call your provider to see if you qualify.
- Check your credit score: Contact your insurance provider if your credit standing has improved (here's how to check your credit score).
- Cars associated with lower rates: If you're getting ready to get a new car then factor in car insurance rates while shopping. Certain cars are cheaper to insure than others.
- Report any life changes: Marital status can make a difference. If you've recently gotten married then contact your insurance company to see if you can get a cheaper rate.
- Bundle your insurance: Bundling your home and car insurance can also potentially lower your rates. "When you bundle with us, you'll earn a multi-policy discount if you have an auto policy and home, condo, or renters insurance with us," Progressive says.
"A number of pandemic-related trends are driving up auto insurance rates throughout the industry. Inflation has possibly had the biggest impact — as the cost of goods and services goes up, so too does the cost of protecting our customers on the road," Progressive explains online, adding that labor shortages and supply chain disruptions in addition to an increase in accidents have all played a role in the increasing costs.
Ultimately, the best way to save is to compare multiple insurance providers and quotes and policies. If you're not satisfied with your current plan then switch. It's never too late!
