New cars are expensive. Used cars are expensive. Now the cost of auto insurance is going through the roof.
With insurance premiums spiking, some families are struggling to pay for their commute.
Read also: How To Reduce Your Car Insurance Costs
Rates for many drivers up sharply this year
Auto insurance premiums are up 26% compared to 2023, according to Bankrate.com.
Bankrate data shows the average driver is paying more than $2,500 a year for car insurance, 3.4% of their median household income.
Things you can do to lower your rate
If auto insurance rates are soaring in 2024, it can be concerning for drivers. Here are some strategies you can consider to mitigate the impact and potentially lower your auto insurance costs:
1. Shop Around for Quotes:
- Rates can vary significantly between insurance providers. Obtain quotes from multiple insurers to compare prices and coverage options. Look beyond well-known companies and consider regional or local insurers.
2. Bundle Policies:
- If you have multiple insurance needs (e.g., auto and home), bundling them with the same provider may lead to discounts. Inquire about multi-policy discounts to potentially lower your overall insurance costs.
3. Review and Adjust Coverage:
- Assess your current coverage needs and adjust your policy accordingly. While maintaining essential coverage is crucial, you may find areas where you can reduce coverage or adjust deductibles to lower premiums.
4. Maintain a Good Driving Record:
- Safe driving habits can contribute to lower insurance premiums. Avoid traffic violations and accidents, as a clean driving record is often rewarded with lower rates.
5. Explore Usage-Based Insurance (UBI):
- UBI programs, such as telematics, monitor your driving behavior. If you’re a safe driver, you may be eligible for discounts based on your actual driving habits.
6. Improve Your Credit Score:
- In some regions, insurers use credit scores as a factor when determining rates. Maintain a good credit score by paying bills on time and managing your credit responsibly.
7. Ask About Discounts:
- Inquire about available discounts. Insurers offer various discounts for factors such as safe driving, good student status, military service, and more. Ensure you are aware of all the discounts you may qualify for.
8. Consider a Higher Deductible:
- Raising your deductible can lower your premium. However, it’s essential to ensure that you can afford the higher out-of-pocket costs in the event of a claim.
9. Maintain Continuous Coverage:
- Insurers often offer lower rates to drivers with a history of continuous coverage. Avoid lapses in your insurance policy to maintain a favorable insurance history.
10. Review and Update Your Policy Annually:
- Regularly review your policy and make adjustments based on changes in your circumstances, driving habits, or financial situation. Updating your policy can help ensure you have the right coverage at the best possible rate.
11. Participate in Defensive Driving Courses:
- Completing a defensive driving course may qualify you for insurance discounts. Check with your insurer to see if they offer discounts for completing such courses.
12. Consider Usage-Based Insurance:
- Some insurers offer programs that monitor your driving habits using telematics. If you are a safe driver, you may qualify for discounts through these programs.
13. Explore Government Programs:
- Inquire about state or regional programs that may assist with auto insurance costs, especially if you are facing financial hardship.
14. Seek Professional Advice:
- Consult with an insurance broker or agent to get personalized advice tailored to your situation. They can provide insights into available discounts and help you navigate the insurance market.
Conclusion
Keep in mind that insurance rates are influenced by various factors, including your location, driving history, and the overall insurance market. While you may not have control over all these factors, exploring these strategies can help you make informed decisions to manage and potentially reduce your auto insurance costs.
