If it feels like your car insurance payment is taking a larger portion of your budget lately, cit’s not your imagination. Rates for auto coverage have been climbing at a rapid pace over the past year. That’s putting financial strain on many households that are already contending with elevated prices for gasoline, groceries and just about everything else due to persistently high inflation.

And, a confluence of factors is driving the spike in premiums. For starters, auto insurers have seen their expenses soar, which is leading them to raise rates to protect profitability. For example, replacement parts have gotten pricier, due in large part to elevated commodity costs. Labor costs are also up significantly as insurers pay more for automotive technicians and other workers. At the same time, severe weather events have resulted in higher volumes of auto claims in many parts of the country. 

While the magnitude of the car insurance rate increases can vary significantly based on each driver’s unique factors (like their driving record, location, type of vehicle and coverage levels) the cumulative effect of these hikes is leaving countless drivers looking for ways to dial back their premium payments. And, with the summer vacation season fast approaching in June, finding opportunities to reduce insurance costs could free up some much-needed funds for households to allocate elsewhere. Below, we’ll detail how you can do that.

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How to lower your car insurance rate for June

If you want to try and lower your car insurance rate for June, consider these approaches:

Shop around and compare rates from multiple insurers

Car insurance companies can charge drastically different rates for the same coverage, so you may want to get quotes from at least three to five companies to find the best deal. This is easy to do online, as most insurance companies offer personalized quotes on their websites. All you have to do is enter some basic information to find out what your car insurance rate would be and then compare it to other offers you’ve gotten from competing car insurance companies.

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Boost your car insurance deductible 

You can also consider increasing your car insurance deductible if you can comfortably afford to do so. For example, raising your deductible from $500 to $1,000 could cut your premium significantly. Before you do this, though, be sure to calculate whether you can handle paying more out-of-pocket if you do get in an accident or need a covered repair. You may also want to consider setting aside money for a higher deductible in an emergency fund to ensure you have it on hand if you need it.

Ask about discounts you qualify for

It’s common for auto insurers to offer a wide range of discounts for safety features, good driving records, low annual mileage or other qualifying factors. In turn, equipping your vehicle with anti-theft devices, anti-lock brakes, or lane-departure warning could net you a discount. Your insurer may also offer good driver discounts, which typically range from 10% to 30% on average, for drivers who have gone a certain number of years without a moving violation or accident claim. 

Consider downgrading certain coverage 

If you drive an older car worth less than about $4,000, it could make sense to drop the costlier collision or comprehensive coverage to reduce your premium. After all, the increase in premiums for this type of coverage typically doesn’t make much sense for those whose cars are worth less than a few thousand dollars. That said, you should be sure to factor in your car’s potential repair costs versus its value if you do get in an accident.

Switch to a usage-based insurance program

If you don’t drive often, switching to a usage-based insurance program can make a lot of sense financially, as it typically results in lower auto insurance costs compared to a typical policy. For example, insurers will typically offer discounts for low-mileage drivers who install a free telematic tracking device that monitors driving behavior. While it varies, you typically need to drive under 10,000 miles annually to qualify for these or other types of usage-based discounts, but it can vary by insurer.

Pay your policy in full instead of monthly 

Numerous insurers tack on fees of typically of $5 to $10 per month, approximately, if you opt to pay for your car insurance policy with a monthly payment plan instead of paying your annual premium upfront. In turn, paying for your policy in full upfront can result in lower costs on your car insurance. If handling a larger annual sum is difficult, it may help to go on a budget plan and escrow funds each month for your renewal.

Bundle your auto insurance 

You can also consider bundling your car insurance policy with other insurance policies, like your home insurance or renters insurance policy. This can result in cheaper car insurance, as many insurers provide discounts that typically range from 10% to 25% for bundling multiple policies together. And, not only does this have the potential to lower your car insurance costs, but it also simplifies things to have one company handle both your auto and home, renters, life or umbrella policies.

Improve your credit score 

It may also help to take steps to improve your credit, as insurers will often factor this into pricing (in many states). Those with poor credit scores are seen as higher risks and typically get charged more compared to someone with excellent credit in states where your credit score can be considered as part of your car insurance premium. In turn, boosting your score into the good range (or better) could lead to sizable premium savings.

See if your employer or other organizations offer group insurance rates 

Many large companies and organizations leverage their bulk purchasing power to provide members discounted group rates of 5-10% or more on insurance. If you’re employed or are a member of an organization or two, you may want to inquire about potential affiliations that could save you money on your car insurance policy.

Explore options to lower coverage levels 

Some states allow you to opt out of certain coverages like bodily injury liability or uninsured/underinsured motorist coverage to reduce your premium. Doing so could help you cut the costs of your car insurance, but this comes with more risk if you are at-fault in an accident with injuries, so be sure to weigh the potential benefits and the potential risks of lowering your coverage levels before making this move.

The bottom line

Car insurance costs have been climbing, but the strategies listed above could be useful for lowering your policy costs. While some of these cost-cutting measures require taking on more risk or reducing coverage levels, others simply come down to shopping around and being savvy about the various discounts and programs car insurance companies offer. And, by investing a bit of time and effort now, before June rolls around, you may be able to uncover meaningful ways to keep premium costs from becoming overly burdensome during an already challenging period of high inflation and interest rates.