With rent and inflation high — and Dollar Tree charging $1.25 for a single Sharpie —you’re probably looking for ways to save money in 2023 without giving up your lifestyle.
Thankfully, one of the fastest and easiest ways to save a few hundred bucks this year is to get smart with your auto insurance.
From taking a quick defensive driving course to asking your provider “the magic question,” here are six ways to save on auto insurance costs in 2023.
1. Take a 1-hour defensive driving course
Remember when you first got your quote and your insurance company asked this question?
Most folks gloss over this question, but there’s a potential big discount hidden in plain sight. Taking a defensive driving course can save you 5%, 10%, or even up to 20% on your auto insurance premiums.
So how much time and money is involved in taking one of these safe driving courses?
Well, most providers say they’ll only accept official, DOT-approved courses. These cost at least $100 and can take up to eight hours of classroom time.
I’m sure these courses are tremendously beneficial and will pay for themselves after a year of discounts, but there might be an easier way.
In my experience, I was able to snag a 7% auto insurance discount by taking just a one-hour online defensive driving course with DriveSafe. They’re a legit DD provider recognized by most major car insurance companies, and they’ll even refund your $25 course fee on the off chance your provider doesn’t give you a discount.
Read more: Defensive driving class discount: save money on auto insurance
2. Call your provider and straight up ask for discounts
Insurance providers are one of the few for-profit entities that will happily explore ways to save you money.
For context, you can’t go to Costco, fill up a cart, and say, “find me coupons for all this stuff.” Costco’s customer service is amazing, but you’ll still probably get beamed in the head with a $1.50 hot dog for asking this.
By contrast, this does work with insurance providers. You can call up your provider and ask the rep on the phone to help you hunt for discounts.
That’s because insurance providers now realize that the dozens of discounts they offer can be hard to navigate, so they’re generally happy to help you find them and save money.
3. Update your driver profile
While you’re on the phone with your insurance agent, that’s also an excellent time to update your driver info.
Remember; your insurance premiums are primarily based on risk factors like where you park your car at night, how much you drive, how recent your last moving violation was, etc.
So if any of those things change and make you less risky, you should let your provider know.
Life changes that can lead to lower insurance premiums can include, but aren’t limited to:
- Moving somewhere safer.
- Parking in a covered space at night.
- A new job with a shortened commute.
- Getting married.
- Moving to an area with better weather.
- Moving to a zip code with lower crime.
Another big one is your latest moving violation. If your latest moving violation was less than three years old when you first got quoted for a rate and is now more than three years old, that should lower your auto insurance premiums. But providers don’t always automatically factor out old moving violations, so you have to poke them to ensure they have your current driving record.
4. Reassess how much coverage you really need
A pretty surefire way to lower your insurance rates is simply buying less of it.
Do this: start with a blank slate and walk yourself through our guide; what type of car insurance do you need?
Use it to build a “grocery list” of how much of each type of insurance you think you need. Then, cross-compare your list with the current levels of coverage you’re paying for.
Did anything change?
To give some examples, if you work from home these days and barely drive your car, you’re probably safe to reduce your collision coverage. If you garage park your car, you can probably lower or even eliminate your comprehensive coverage.
As for deductibles, if you have enough savings now to pay $1,000 or more out of pocket on an unexpected car repair, you’re probably safe to raise your deductible (thus significantly lowering your premiums).
5. Participate in a telematics program (Progressive Snapshot, GEICO DriveEasy, etc.)
Telematics, aka driver monitoring, programs are a neat way of showing your provider that you’re a low-risk driver in real-time. Once they see how safe and sensible a driver you are, they offer you a steep discount.
Here’s how most telematics programs work:
- You opt into the program from your provider’s website, often for an immediate discount of around 10%.
- Your provider sends you a device to plug into your car’s OBD-II port (or has you download an app).
- Over the next three to six months, your provider monitors your driving habits: how slowly you come to a stop, what times of day you drive, etc.
- Based on your “score,” you receive an additional discount of up to 40%.
Naturally, the benefits of opting into a telematics program are pretty steep. If you don’t mind a few months of delicate driving, braking, and taking turns like grandma’s eating soup in the passenger seat, you could be looking at a car insurance discount of nearly half of your premiums.
However, some folks (myself included) don’t like Big Brother looking over their shoulder while driving. Telematics devices often beep at you when they sense an “infraction,” which can raise anxiety levels on your daily commute.
Still, if you drive like a monk already, you might as well let your provider watch and score a discount.
6. Shop around for a better rate
Finally, the most time-tested method of saving on auto insurance is to shop around for a better car insurance rate.
Every auto insurance provider calculates risk — and thus your premiums — differently. A female working professional driving a Hyundai Kona in Austin, Texas, may look like the lowest risk driver ever to one provider and a reckless rally driver to another.
You may be stuck with the provider who thinks you’re a huge liability, for whatever reason, and is charging you out the wazoo for coverage.
That’s one of my six reasons to shop for car insurance every six months; you want to find the provider who sees you as the lowest risk (and thus charges you the least for identical coverage).
And thankfully, getting a car insurance quote online can take just five minutes per provider. Check out our list of the best car insurance companies of 2023 for a place to start.
The bottom line
With rent and inflation high through 2022, budgets may feel tight in 2023. Thankfully, saving a few hundred bucks on auto insurance is an easy way to loosen the belt buckle.
Between taking a defensive driving course, opting into telematics, and simply shopping around for a better deal, you can save more and sleep easier.
And for more on ways to make a dollar go farther, check out How to budget: 4 easy steps to get you started.
Featured image: CHOTTHANIN THITIAKARAKIAT/Shutterstock.com