Tips and tricks to lower the cost of your auto insurance

Auto insurance is a musthave for drivers. While it might seem hard to believe, as of 2019 there are still some places in the United States where auto insurance is not mandatory. Auto insurance is mandatory in Canada, though each province has its own requirements in terms of the minimum amount of coverage allowable by law.

Many people, even those in places where auto insurance is not mandatory, recognize the importance of being insured before they get behind the wheel. However, that doesn’t mean those same drivers would not like to cut the cost of their auto insurance policies. A 2019 analysis from the online financial resource NerdWallet found that the average cost of car insurance in the United States is $1,621 per year. Average insurance costs vary significantly in Canada, where data from the General Insurance Statistical Agency found that, in 2019, the average annual insurance premium in British Columbia exceeded $1,800, while drivers in Quebec paid slightly more than $700 annually.

No matter where drivers live, chances are they would love to lower their auto insurance costs. While there’s no one-size-fits-all solution to cut auto insurance premiums, drivers can try various strategies to save money on their policies.

• Raise your policy’s
deductibles. Higher deductibles may sound scary
to drivers, but raising the
deductibles is a great way
to lower the cost of auto insurance. The auto insurance
provider Progressive notes
that deductibles typically
range from $100 to $2,000.
A driver whose policy has
a $100 deductible will pay
considerably more on his
policy per month than a
driver with a higher deductible. In fact, the Insurance
Information Institute notes
that drivers who increase
their deductibles from
$200 to $1,000 can save 40
percent or more on their
coverage costs. Drivers who
choose this option should
always be sure they have
enough money in the bank
to cover the cost of their
deductibles.
• Bundle your policies.
Some drivers save money

on their auto insurance policies by buying two or more
types of insurance from the
same provider. For example,
homeowners may save
money by buying homeowners insurance from their
auto insurance providers or
vice versa.
• Research potential
discounts. The III notes
that many companies offer
discounts to policyholders,
even if those discounts are
not necessarily promoted.
Drivers can contact their
insurance companies, or
shop around with other
providers, to ask about
various discounts that can
save them money on their
policies. Anti-theft devices,
defensive driving courses,
low annual mileage, and
a strong credit record are
just a handful of the many
potential discount’s drivers
may be eligible for.

Drivers can reduce the cost of their auto insurance policies in various ways, potentially saving themselves hundreds of dollars each year as a result.

When shopping for auto insurance, drivers may be most concerned by the bottom lines on estimates they receive from potential providers. However, the Insurance Information Institute recommends that drivers also investigate a company’s reputation and stability before purchasing an auto insurance policy. Rating companies like AM Best (www.ambest.com) and Standard & Poor’s (www.standardandpoors.com/ratings) vet insurance companies in terms of their financial stability. In addition, government organizations may be able to provide potential policyholders with information regarding the history of consumer complaints filed against certain insurance providers. That history, coupled with information regarding a given firm’s financial stability, can give drivers an accurate picture of insurance providers and whether they’re trustworthy or simply the most affordable option on the market.

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