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The cost of car insurance increased substantially in 2024, rising 21% year over year, according to data from the Bureau of Labor Statistics. However, these numbers may be even higher if you live in California, Minnesota or Missouri, where car insurance price increases could exceed 50%.
Rising insurance premiums, in addition to other economic hurdles, like persistent inflation and high housing costs, are putting a strain on many drivers’ budgets. According to one recent survey, 51% are cutting out nonessential spending to deal with higher insurance premiums, while 45% are saving less money.
“Auto insurance rates have been rising for the past several years due to a variety of factors,” said Mark Friedlander, director of corporate communications at the Insurance Information Institute. “These reasons include general inflation and rising costs of replacement parts due to supply chain disruption and labor shortages.”
So what can drivers do to ensure that their car insurance policies are as affordable as possible? Here’s what experts say.
Compare your car insurance options to find the most affordable policy today.
How to find the most affordable car insurance
Car insurance costs may be on the rise, but there are ways to make insurance more affordable. These include:
Increase your deductible
A deductible is a one-time, out-of-pocket expense you’ll make when filing an auto insurance claim. Once the deductible is paid, your insurance coverage should kick in and cover the remainder of your claim.
The deductible is how you share risk with the insurance company, so the higher your deductible, the lower your monthly insurance premium will be, and vice versa. In turn, increasing your deductible can be a good way to save money on auto insurance.
According to Earl Jones, an insurance agent with Missouri Farm Bureau Insurance, increasing your deductible to $1,000 can save you between 10% and 15% on car insurance.
“And some companies offer diminishing deductibles — a deductible that decreases every year you don’t file a claim — which makes higher deductibles even more attractive,” Jones says.
Find out how affordable your car insurance policy could be here.
Maximize car insurance discounts
“Most auto insurers offer a wide array of discounts that can significantly reduce your premium bill,” says Friedlander. “You could earn a loyalty discount for being a customer with the same insurer for several years or a low-mileage discount if you drive less than 7,500 miles a year.”
Alaina Hixson, director of sales and operations at the Churchill Agency, recommends asking your insurer if they offer a telematics program.
“Those are providing the biggest discounts across the board, with many customers saving as much as 30%,” Hixson says.
Telematics programs use either a device or app to collect data about your driving behavior.
“However, it is important to note some insurers could increase your rate if telematics detects poor driving habits,” Friedlander says.
Jones also recommends asking about occupational discounts, especially if you’re in a public service position, like nursing, teaching or firefighting. Many companies offer age-related discounts as well.
“For senior drivers over 65, some companies have discounts if they took a state-approved defensive driving course,” Jones says.
Check your driving record
Your driving record is one of the most important factors when it comes to determining your car insurance rates. That’s why it’s a good idea to periodically check your driving record to ensure it’s being accurately represented to your insurer.
“Inaccuracies can have a huge impact on your rates and discounts,” Jones says.
Hixson agrees, adding that computer glitches can sometimes cause a ticket to show up on your record multiple times. If you catch these errors, you can dispute them with the state agency that governs it.
“Even if a ticket or accident isn’t erroneously reported, you might be eligible for better rates when their impact on your record drops off, which generally takes three years for a ticket and five years for an accident,” Hixson says. “When that window ends, you can always reach out to your insurer to see if the premium can be adjusted on your existing policy.”
Do your homework before buying a new car
Your car insurance premiums are influenced by the make and model of the car you drive. Insurers look at factors like the safety statistics, the likelihood of theft and how expensive your car is to repair.
“As our cars get smarter, they are increasingly reliant on computer systems that are very expensive to repair or replace,” Hixson says. “Insurance companies have to price that in when they consider their risk in underwriting a policy.”
If you’re in the market for a new or used car, compare auto insurance quotes for any vehicles you’re considering buying. You can review the Insurance Institute for Highway Safety’s (IIHS) safety ratings for different vehicles. Your insurer may offer you a discount if you purchase a car with certain safety features.
The bottom line
It’s frustrating to see your insurance cost rise when you haven’t even filed a claim, but you can still find affordable car insurance. Increasing your deductible, checking your driving report for errors and taking advantage of discounts can make a noticeable impact on your insurance premiums.
It also pays to shop around and compare insurance costs anytime you’re looking for a new vehicle. And car insurance quotes can vary quite a bit across different companies, so be sure to receive quotes from at least three different insurers.