Best Car Insurance

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May 31, 2022 by
Looking to save money on car insurance? With plenty of options for auto coverage these days, it can feel pretty overwhelming. Fortunately, there are lots of discounts and ways to cut costs when it comes to auto insurance.


How much of my budget should go towards auto insurance?

Experts recommend setting aside about 10 to 15% of your take-home pay per month for all of your auto expenses combined. This includes a car payment (if you have one), maintenance costs, fuel and car insurance. Let’s say you net $3,500 a month after taxes. Based on the expert advice, that means spending about $350 to $525 a month on car-related expenses, including auto insurance.

Of course, different factors will go into how much you spend on your car each month. If you own your car already, then you won’t have a car payment and can allot more of your budget to maintenance and insurance.

But if you have a car payment – especially in today’s economy – that payment is going to eat up a bigger chunk of your budget. According to Bankrate, the average cost of a used car loan in 2022 is $465 a month. For new cars, it’s $609.

It might be more helpful to think about what people are already paying for coverage. In 2018, Americans spent about 1.67% of their household income on auto insurance. If you’re earning $3,500 a month ($42,000 a year), that’s just over $701 in annual car insurance premiums, or about $58 a month.

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Rates starting at $39/month

What kinds of discounts do car insurance companies typically offer?

Three words: lots of them. Auto insurance carriers offer a lot of different discounts, some universal and some specific to the company. And you can stack them, too, which means if you qualify for five discounts – lucky you – you can apply all of those discounts to your premium, making car insurance super affordable. Here are some common auto insurance discounts you’ll see:

Bundling multiple insurance policies together – like auto and renters – can help you save money on all of them at once.
Good credit
Having good credit history usually gets you access to better rates already, and maintaining a good score may help trim down your premium costs even more.
Good driving history
Insurance companies look kindly on a clean driving record. Being a careful driver may knock some dollars off your annual premium.
Group and/or military
If you belong to any organizations or groups, you may qualify for special discounts based on your membership. Likewise, former and current military members may have access to special rates as well.
Multi-driver and/or multi-vehicle
If you have more than one vehicle and/or more than one member of your household who needs insurance, consider getting everyone on the same plan. You’ll save more money overall by bundling.
How you pay your premiums can even help you save money. There may be a discount for paying your premium up front instead of monthly. Or you might be able to save some money by setting up automatic bank drafts.
Teen drivers may qualify for school-based discounts, like maintaining good grades or even taking approved driver safety courses.
Telematics are essentially programs designed to track your driving via app and/or monitoring device. Companies use this info to reward good drivers with premium discounts, which can be substantial.
This list is definitely not exhaustive. You can find a wide range of auto insurance discounts just by asking. So if you’re not finding affordable car insurance right away, check for premium discounts. You may even qualify for several, which could significantly reduce your premium.

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How do I get more affordable auto insurance?

Before we answer this one, just note that the cheapest auto insurance isn’t always good enough. Sometimes it is, and more power to you if that’s the case.

But don’t settle for cheap car insurance just because the premiums are low. For one thing, you may need more coverage to meet your state’s minimum requirements. For another, having a policy that you can actually use is just as important as finding one you can afford. There’s no use in saving money on car insurance if you have trouble filing a claim when you need to.

That said, here are some ways to save money on auto insurance:


Check for discounts

We talked about discounts in the last section, but we’ll reiterate here. Always check for discounts. Chances are, you qualify for at least a couple, if not more. Using an online comparison tool – like ours – will help you find them automatically.


Compare different plans online

Finding affordable car insurance is easier than ever thanks to online comparison tools. Shopping online lets you see policies next to each other, so you can compare the features you want and find a plan that fits your budget.


Shop around at least once a year

Once you find an auto policy you like, you may be tempted to just keep it and never look back. And that’s fine, except that rates change every year, and your needs probably do, too. Take the time to shop around at least once a year to make sure you still have the best deal. You may find a better policy or one that costs less.


Get some help

Not sure about auto insurance terms or what you’re actually buying? Having trouble finding discounts? Get some help. Shopping online might be convenient, but talking to a car insurance agent may work better for you. An agent can help you find relevant discounts and walk you through the process, saving you dollars and time.

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