Car Insurance | 9 Ways to Lower Your Rate

lower car insurance

To help you cut costs on your car insurance and get the most bang for your buck, we’ve put together 9 ways to lower your car insurance rate. From using telematics to paying in full upfront – we’re going to help you save some money.

1. Pay in Full

The pay in full discount is much bigger than most people realize. The average savings is around 10 – 15%. If you have a 12 month policy, you would need to pay the premium for the full 12 months up front. For a 6 month policy, you would need to pay for 6 months up front.

If you’re paying monthly right now and the pay in full option just isn’t in your budget, consider paying semi-annually or quarterly. While the discount won’t be as big as paying in full, you still might be able to get a discount depending on your insurance company.

2. Bundle other Policies

Ok, so you’ve probably already heard this one a million times in all the insurance ads. However, it is a large discount and one we have to mention. Typically around 15 – 20%, you are going to save some serious money.

Here’s something you probably didn’t know. Sometimes you can still get a bundle discount even if you have your home and auto with different insurance companies.

If you have an insurance broker and have all of your policies with them, they may be able to apply a bundle discount. That is only one of the many reasons why working with a broker versus a captive agent is advantageous.

The bundle discount isn’t just for home and auto. You may be able to apply even more bundle discounts for the following policies:

  • Umbrella
  • Life
  • Motorcycle
  • Boat
  • RV
  • ATV

3. Utilize Telematics

According to Cambridge Mobile Telematics distracted driving caused an additional 420,000 crashes, 1,000 fatalities, and $10 billion in damages to the US economy in 2022.

They make telematics for some of the biggest names in insurance including State Farm, Progressive, Farmers and Nationwide.

Telematics is technology that tracks your driving behavior. Most insurance companies now utilize this optional tool. We know, this is a polarizing topic because big brother and big data spying. We’re not here to debate that and you can make your own decision.

But think of it this way, this may be one of the only ways you have to control your insurance premium. You have control over your driving habits and that gives you control over how much you pay for car insurance.

There are insurance companies out there now offering discounts of up to 40%. You’re not going to find any other discount this large. To participate you’ll either need to plug in a device to your car or download the mobile app.

At this point, most insurance companies operate off the mobile app. If you’re a passenger in someone else’s car, you simply notify the app that you are not driving.

Some of the common driving attributes tracked are:

  • Excessive acceleration
  • Hard braking
  • Speed
  • Time of day you’re driving
  • Phone distraction

You’ll need to allow them to track your driving anywhere from a few months to a year, and for some companies, indefinitely. You’ll want to ask your agent if your rate could go up as a result of participating.

Most programs will only apply a discount for good driving but won’t punish you buy raising your rate if you scored poorly. However, there are a few that will surcharge so be sure to ask before making the commitment.

4. Increase Your Credit Score

Your car insurance premium is heavily weighted on your credit score. It can affect your rates by up to 200%. Like it or not, that’s just reality. Work on getting your score up. Credit card utilization is usually a great place to start.

If you’re using 50% of your available credit, shoot for getting that down to 20%. If you can get it under 10% you’ll really see a spike in your score.

There are many sources that can help you track your progress. Aura and Credit Karma are great options. Just remember, these companies make money by tempting you with credit card and personal loan offers because they make a commission if you apply.

Once your credit has increased you’ll want to ask your agent to have your policy re-rated or consider moving to a new insurance company. With most companies, they can only re-rate your policy based on your credit at your annual renewal. It may not be an option mid-term.

Check out How Credit Score Affects Insurance Rates to get more granular on this topic.

5. Increase Deductible

Increasing your deductible will lower your rate. However, a word of caution here. This is a great way to get yourself in financial trouble. If you don’t have cash or an emergency fund at least equal to your deductible, do not raise your deductible. Otherwise, you’ll end up racking up credit card debt.

As we just discussed, that is just going to lower your credit score and work against you when trying to lower your car insurance rate.

6. Shop Around

If you’re currently with a captive agent, consider working with an independent agent who has more options. Captive agents are employees of insurance companies. These are companies like State Farm, Allstate, Farmers and American Family.

You’re familiar with these companies because they spend billions on advertising every year. However, they are not the best option.

An independent agent is not an employee of any insurance company. They can shop dozens of insurance companies and find the best fit for you. Do you want your agent working for the insurance company or working for you?

It’s important to regularly review and compare insurance rates. As you change vehicles, drivers or even where you live, you may not be the best fit for your insurance company anymore. Also, good agents will perform an annual review to make sure your coverages and rates suit you.

7. Usage Based Insurance

Usage based insurance allows you to pay based on how much you drive as well as other factors like driving habits. This can be a great option if you are a low mileage driver.

Currently, these companies have great rates for low mileage drivers but the rates are not very competitive for average or higher mileage. Also, there are only a few companies that are usage based so your options are limited.

8. Early Shopper

The early shopper discount is applied if you don’t make your policy effective for about 7-10 days after you received your quote. This discount ranges from around 10 – 20%.

This is huge because it typically stays on your policy for the life of the policy. You don’t want to unnecessarily pay an extra 10 – 20% every year just because you didn’t shop ahead of time.

9. Other Discounts to Ask About

  • Good student
  • Military
  • Student away at school
  • Automatic payment
  • Paperless policy
  • Defensive driving course


As you can see there are many ways to lower your auto insurance rate. Shopping early, increasing your credit score and bundling your policies alone could save you up to 55%.

Talk to your agent to review and shop your insurance at least 30 days before your renewal to take advantage of as many discounts as possible. With this amount of savings it’s worth it to do a little homework ahead of time.

Frequently asked questions

What is the biggest auto insurance discount?

Bundling your homeowners insurance is typically one of the biggest discounts at around 15 – 20%.

How can I save the most on auto insurance?

Your credit score can affect your rates by up to 200%. If your score has recently increased, you should re-shop to take advantage of this savings.

How much can I save by paying my car insurance in full?

This will vary by company but you could get up to a 15% discount.

How much can I save if I let my insurance company track my driving?

Also known as telematics, your insurance company will track your driving and your performance will determine your premium. Savings can be up to 40%.

Typical factors are:

– Excessive acceleration
– Hard braking
– Time of day driving
– Miles driven
– Phone distraction

What are some lesser known car insurance discounts?

– Automatic payment
– Paperless policy
– Early shopper
– Telematics
– Download the app

Request Your Proposal Here

Are you ready to save time, aggravation, and money? The team at Partners Insurance is here and ready to make the process as painless as possible. We look forward to meeting you!

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