How to find the cheapest car insurance + smart ways to save every dollar

Car insurance is one of those bills that most of us can’t avoid, but that doesn’t mean you should pay too much for it! Whether you’re renewing a policy or looking for new coverage, there are simple ways to ensure you get the cheapest car insurance price for the coverage you need.

Car insurance is actually one of the easiest bills to reduce with a little intentional effort. Unlike utilities or rent, you actually have quite a bit of control over what you pay, and many families leave hundreds (or even thousands) of dollars on the table simply because they haven’t reviewed their policies in a while.

Now let’s look at practical ways you can lower your premiums and save money!

Tips to get the cheapest car insurance:

1. Shop around regularly (even if you like your current company)

One of the biggest mistakes people make with car insurance is staying loyal to one company for too long. Insurance companies often reserve their best rates for new customers. That means the great deal you signed up for years ago may no longer be competitive, even if you’ve been a safe, responsible driver.

At least once a year (or whenever your policy renews) take the time to get quotes from multiple insurers, compare coverage apples to apples, and see how your current rate stacks up.

This doesn’t mean you have to switch, but having competitive quotes does give you an advantage. Sometimes simply telling your current insurer that you are considering leaving can prompt them to lower your rate.

2. Ask about discounts and then ask again

Many insurance discounts are not applied automatically. You have to ask often.

Some common discounts are:

• Safe or accident-free driver discounts
• Good student discounts for young drivers
• Discounts for low mileage
• Paperless billing or automatic payment
• Multipolis (bundling of home/tenant + car)
• Discounts for workplaces, alumni or professional groups

Even if you’ve asked before, it’s worth checking again. Your eligibility for a discount may change over time, especially if your driving behavior, work or family situation has changed.

Tip: Ask your agent to review your account and confirm that all available discounts are being applied.

3. Increase your deductible to lower your monthly premium

Your deductible is the amount you pay out of pocket before insurance covers the remainder of a claim. Choosing a higher deductible usually results in a lower monthly premium.

For example:

• Increasing your deductible from $500 to $1,000 can significantly reduce your insurance costs.
• This strategy works best if you have a small emergency fund or sinking fund set aside to cover that deductible if necessary.

This is a great way to save in progress without reducing your actual coverage by adjusting your share of responsibility if something happens.

4. Reevaluate coverage for older cars

If you drive an older vehicle that has already depreciated significantly, it may not make sense to continue paying for full collision or comprehensive coverage.

A good rule of thumb:

• If the annual coverage cost is close to or higher than the value of the car, it’s time to reconsider.
• Dropping certain coverage can lead to significant savings, especially on paid-off cars.

You’ll still want to maintain liability coverage, but adjusting your policy based on the car’s current value can free up money each month.

5. Take advantage of low-mileage, usage-based programs

If you’re driving less than you used to (whether you’re working from home, carpooling, or running fewer errands), you may be paying too much.

Many insurers offer:

• Discounts for low mileage
• Usage-based or telematics programs that monitor driving behavior
• Insurance options based on pay per kilometer

If your car spends more time parked than on the road, make sure your insurance reflects this reality.

6. Keep your driving record clean

This may sound obvious, but it is one of the most powerful ways to keep insurance costs low in the long run.

By avoiding tickets, accidents, and claims, you can lock in lower base rates, qualify for safe driver discounts, and avoid rate increases due to violations.

Even one speeding ticket can increase your premium for years, so safe driving really pays off.

7. Pay your premium in full if you are able to do so

Many insurance companies charge extra fees when you pay monthly, adding interest to your policy.

If you can afford to pay semi-annually or annually, you can avoid these additional costs and reduce your overall costs.

If paying the full amount in full seems like too much, consider setting aside a little each month into a sinking fund so you’re ready when the time for renewal comes.

8. Adjust coverage for cars that are rarely used

This is a tip that MoneySavingMom readers have mentioned over the years, and it’s especially helpful for families with multiple vehicles.

Call your insurance company and ask about limited use or storage coverage options if you:

• A second car that is rarely driven
• A car that stands still for months
• A seasonal or spare car

You may be able to temporarily reduce certain coverage and save money while still keeping the vehicle insured.

9. Never renew automatically without reviewing your policy

Auto-renewal is convenient, but convenience can be expensive.

Each renewal period is an opportunity to check for new discounts and adjust coverage if there have been any changes to your situation. Shopping for better rates doesn’t have to take long and can help you save more money in the long run.

Even if you spend 30 minutes reviewing your policy once a year, you can make significant savings.

Bonus Tips: How to Get the Cheapest Car Insurance for Young Drivers

With 3 young drivers, I can tell you firsthand: If you add a teenage or young driver to your car insurance policy, your premiums will increase – there’s no way around it. That said, you’ll get even more meaningful savings if you follow these tips when insuring a young driver! Be sure to shop around, encourage your young driver to keep a clean driving record, and reevaluate whether you have full coverage for older cars.

Here are some other ways to score the cheapest car insurance for young drivers:

• Get a “Good Student Discount” – If your young driver gets good grades, many insurers offer savings just for maintaining a B average or higher.
• Look at other discounts for young drivers – Some insurers offer additional discounts for driver training courses, for students who are at school without a car, and for being listed on a family policy rather than a standalone policy.
• Choose your young driver’s car carefully: one of your biggest cost factors is the car your young driver is assigned to under the policy. Where possible, place them on the least expensive vehicle – ideally something that is older, reliable and boring in the best way. By pairing a modest car with a higher deductible (if you can easily afford it) you can lower premiums even further while still getting the coverage you need.

Turn car insurance into an annual money-saving win

To get the cheapest car insurance, you don’t have to switch companies every few months or become an insurance expert. What it do requires that you treat your policy like any other part of your budget and something that should be checked regularly.

A good place to start is by choosing a small action this week:

• Request two or three new quotes
• Call your current insurer and ask for a discount overview
• Reexamine coverage for an older or rarely used vehicle
• Adjust your deductible so that it better matches your savings

Once you do that, make it a habit. Add an annual reminder to your calendar to check your car insurance before it renews. Rates change. Discounts change. Your life changes. Your policies should reflect all of this.

Even a savings of $30 to $50 per month amounts to hundreds of dollars per year. This is money that can be used for groceries, paying off debts, savingsor family budgeting goals. And the best part? Most of these changes take less than an hour.

More money-saving help:

What are your tips for finding the cheapest car insurance? Share your advice in the comments below!