The average cost to insure an auto has increased by roughly 20% since 2020, which is enough to make any of us wince. After all, few of us have limitless incomes and must adjust our household budget each time a rate hike is introduced.

The silver lining in all of this is the fact that there are five lesser-known ways to save on car insurance, while carrying the level of coverage you need to protect you in the event of a claim.

1. Don’t pay for coverage you don’t need

My husband and I each have a vehicle, and there’s a third car in the garage that I’m too sentimental to get rid of. It’s ridiculous, I know. I’ll get there. In any case, it was our friendly local agent who reminded me that we could drop rental car coverage since we have an extra car to drive when one of the others is being repaired.

His suggestion? Call and ask to add rental coverage when we’re traveling out of town and don’t have access to the third car. Then, when we’re home, cancel the coverage.

Before rattling off the coverage you’re looking for, go through and make sure you actually need it. For example, gap insurance is designed to make up the difference between how much your car is worth and how much you still owe if you’re in an accident. However, gap insurance is unnecessary if your loan balance has dropped below the appraised value of the car.

2. Ramp up your deductible

A deductible is the amount of money you’re expected to pay towards auto repairs if you make a claim. Say the total cost of repairs is $5,000, and your deductible is $1,000. That means you pay the first $1,000, and the insurance company pays the rest.

For years, I made the rookie mistake of choosing the lowest possible deductible. The lower the deductible, the higher the policy premium. By raising your deductible, you should see savings.

3. Drive like your momma is watching you

Even the very best insurance companies in the market are in business to make money. When they have to pay out claims, it cuts into their bottom-line profits. While there is no way to prevent another person from rear-ending you on a rainy day, there is a correlation between how carefully you drive and the odds of getting into an accident.

If you’ve ever made a claim, you may have been surprised by how quickly your auto insurer raised your rates. The best way to avoid that ever-so-frustrating rate hike is to do your part to avoid accidents. By the way, insurance companies really are a bit like mothers. They’re equally displeased if you receive a speeding ticket or other civil offense. For example, the average rate increase following a single speeding ticket is 10%.

4. Squeeze those discounts dry

Discounts vary by insurer, but don’t overlook them because they can leave you with more money to save or invest for your future.

Not sure which discounts are offered? It’s as easy as checking an insurer’s website or asking an agent. They’re happy to give you the run-down — particularly if it means you become a new customer.

In the meantime, you can find a list of the most common discounts here.

5. Opt for a safe vehicle

The next time you’re buying a vehicle, pay special attention to affordable models with high safety ratings from the National Highway Traffic Safety Administration’s New Car Assessment Program (NCAP). NCAP was created to inform drivers about which cars are safest in a crash or rollover.

The safer the vehicle, the lower your premium.

Other money-saving tips

Here are a handful of tips you may already be familiar with.

Play the field

A few months back, I took my own advice and rate-shopped. I wanted coverage as good or better than I had, but needed a better rate. By switching from Farmers Insurance (a solid company) to Progressive Insurance (another solid company), I was able to save $864 annually.

Consider usage-based insurance

Usage-based insurance (UBI) uses technology to track your driving habits, such as speeding and using the phone while driving. Based on those habits, your auto insurance premium is adjusted. For example, if you’re a super-safe driver, you may be rewarded with a safe driver discount.

Bundle

It’s true. Bundling coverages with the same insurance company can snag you a discount on each policy. For example, when I switched our auto insurance to Progressive, I also switched our homeowners policy. Between the two, the annual savings exceeded $1,600.

Ask about payment discounts

Some insurers offer a discount if you pay your entire premium upfront. For example, instead of making monthly payments, you might pay for six or 12 months at once. Insurers are also fond of offering a discount for autopay. That way, you never have to worry about your premium being paid late. Finally, opting for paperless billing may score you yet another discount.

If you have a vehicle, you need some level of auto insurance coverage. However, there’s no rule that says you have to pay full price.

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