How To Lower Your Car Insurance If You Can't Negotiate
Can you negotiate car insurance rates?
In short, no. Insurance pricing factors are myriad, with car insurance companies factoring in a driver's history of infractions and collisions, their credit score, age, gender, location, the type of vehicle insured. In addition to each insurance company's specific pricing structure, state-specific regulations can come into play.
Much like a utility service such as electricity or gas, you cannot negotiate a lower monthly car insurance payment. What you can do, however, is compare rates.
Read on to learn more about the smart steps you can take to lower your car insurance rates.
How to lower your car insurance rates: six easy steps
1. Compare car insurance rates every six months
Although you can’t negotiate your car insurance rate, you’re not contractually obligated to stay with your insurance company. If you find a cheaper rate elsewhere, you can switch insurance providers. Depending on when you cancel and the fine print of your car insurance policy, you could incur fees.
Some companies will add a fee if you cancel very early or very late in your policy period. Outside of these circumstances, an insurer should not charge you for early cancellation. Any premium for which you've paid in advance should be refunded, as well.
Compare insurance rates and find an affordable policy.
2. Be smart with your insurance claims
Car insurance can be a double-edged sword. The more you use it, the more it costs. The general rule of thumb with auto insurance is not to use it if you can afford to cover the out-of-pocket costs yourself. Most insurance companies will charge you extra for up to three years after an at-fault claim.
While the rate hike you receive may vary based on your location and provider, we've created an average rate increase after filing a collision claim in which the damage exceeded $2,000. See below how much this claim might cost over a three-year period.
| Year after accident | Average annual premium | increase vs. typical rate |
|---|---|---|
| No accident | $1,548 | — |
| After 1 year | $2,315 | +$767 |
| After 2 years | $3,082 | +$1,534 |
| After 3 years | $3,849 | +$2,301 |
Over a three-year period, this claim could cost you $2,301 — plus your deductible. Given these figures, you should not file a claim if the out-of-pocket repairs cost less than the rate increase ($2,301) plus your deductible. Learn more about our data analysis on our methodology page.
If you're unsure of whether or not to file a claim, take the below steps.
- Get an estimate for the repairs at an auto shop.
- Use The Zebra's State of Insurance analysis to see how much an at-fault accident raises car insurance rates in your state. Consider that this increase may span a period of three to five years.
- Compare the out-of-pocket expenses to the rate increase you'd incur along with your deductible. If it's cheaper to file a claim, do that.
If you’re looking for additional information relating to claims, see our guides below.
3. Understand your auto insurance coverage
The value of your vehicle helps to determine the insurance coverage you need. If your vehicle is owned outright and worth less than $4,000, you might not need comprehensive and collision coverage. These coverages, only required if you’re leasing or financing a vehicle, are designed to protect your vehicle. However, if your vehicle isn’t worth much, you might be paying for coverage you might not need. See below how your premiums can change based on the coverage you carry.
| Coverage | Avg. Annual Premium |
|---|---|
| Liability only | $597 |
| Full coverage w/$1,000 deductible | $1,554 |
| Full coverage w/$500 deductible | $1,760 |
You can determine the value of your vehicle via the Kelley Blue Book or NADA. If you decide to remove collision and comprehensive coverage, consider keeping uninsured motorist bodily injury and property damage coverage. This way, you still be covered if a driver without insurance or insufficient insurance coverage damages your vehicle.
It's also important to ensure you’re properly covered. Many drivers leave themselves and their assets at risk in order to keep their premiums low. If you have a loan or lease on a new car or a valuable older model, you should carry collision, comprehensive, and potentially gap insurance. Without these coverage options, you will have no coverage in the event of an at-fault accident.
Your liability offers no coverage for your vehicle if you're determined to be at-fault. Find out how much coverage you need.
The Zebra’s Dynamic Insurance Rating Tool data methodology
The Zebra’s Dynamic Insurance Rating Tool for home and auto insurance rates utilizes the latest ZIP code-level rate filings from across the U.S., sourced from Quadrant Information Services and S&P Global. These filings, typically updated annually or biennially by insurers, are verified through Quadrant’s QA process and then integrated into The Zebra’s estimator.
The displayed rates are based on a dynamic home and auto profile designed to reflect the content of the page. This profile is tailored to match specific factors such as age, location, and coverage level, which are adjusted based on the page content to show how these variables can impact premiums.
For a comprehensive understanding, see our detailed methodology.
4. Bundle your policies
If you rent or own a home or condo, keep all your insurance policies together with the same company. Not only will this cut down on the number of insurance companies you have to deal with, but will lower the premium on each policy.
For more information on bundling insurance policies, see our guides:Â
5. Consider discounts
You shouldn’t stay with an insurance company simply because of a single discount. However, it’s a good idea to look for the best possible discounts, depending on your driving profile. See below some common auto insurance discounts, and follow the links for more information.
- Good/safe driver (no incidents or a defensive driving course)
- Multiple drivers
- Multi-vehicle
- Multiple policies
- Payment by bank account
- Paid-in-full
- Good student
- Telematics or in-car safety features
- eSign
- Group participation/affinity membership discount
- Homeowner discount
- Green vehicle discount
Not all of these car insurance discounts will be available, as they are subject to state and insurance provider restrictions. While discounts can add up to save you money, it is by no means the best way to lower your car insurance premiums. The absolute best way to ensure you're paying the least for car insurance is to follow all our tips. Shop around as much as possible, keep your claims as minimal as possible, and understand your coverage.
Get personalized insurance rates in less than 5 minutes.
6. Review frequently asked questions on how to reduce car insurance costs
Each state has different car insurance regulations to determine how rates are set. Your individual driving profile also contributes to how much you pay. Your driving record, address, type of vehicle, and — in some states — age, gender, and credit history are used to determine your rates.Â
Because auto insurance rates are dependant on the individual profile of every driver, you will need to provide certain personal details in order to get an accurate rate. This includes your age, address, type of vehicle, driving history, and, in some states, even your credit history. It’s important to remember that a quote is just an estimate of what you will pay. Underwriters ultimately set your rates based on the information you provide as well as your official driving record. In general, the more information you provide, the more accurate your quote will be.Â
You can get free car insurance quotes in a number of ways. One way of doing so is to reach out to insurance companies individually. After providing certain personal details, companies can give you an insurance quote quite quickly. A more efficient method is to compare many auto insurance quotes at the same time. The Zebra allows you to compare side-by-side rates from multiple carriers instantly.
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About The Zebra
The Zebra is not an insurance company. We publish data-backed, expert-reviewed resources to help consumers make more informed insurance decisions.
- The Zebra’s insurance content is written and reviewed for accuracy by licensed insurance agents.
- The Zebra’s insurance editorial content is not subject to review or alteration by insurance companies or partners.
- The Zebra’s editorial team operates independently of the company’s partnerships and commercialization interests, publishing unbiased information for consumer benefit.
- The auto insurance rates published on The Zebra’s pages are based on a comprehensive analysis of car insurance pricing data, evaluating more than 83 million insurance rates from across the United States.