With rents rising and inflation – and with Dollar Tree charging $1.25 for a single Sharpie – you’re probably looking for ways to save money in 2022 without giving up on your lifestyle.
Luckily, one of the quickest and easiest ways to save a few hundred dollars this year is to take out auto insurance wisely.
Here are six ways to save on auto insurance in 2022, from a quick safe driving course to the “magic question” to your provider.
1. Complete an hour-long safe driving course.
Remember when you first got an offer and your insurance company asked that question?
Most people keep quiet about this issue, but the potential big discount is hidden in plain sight. Taking a safe driving course can save you 5%, 10% or even up to 20% of your insurance premiums.
So, how much time and money does it take to complete one of these safe driving courses?
Well, most providers say they will only accept official DOT-approved courses. They cost at least $100 and can take up to eight hours of classroom study.
I’m sure these courses are extremely useful and will pay off after a year of discounts, but there could be an easier way.
In my experience, I was able to get a 7% discount on auto insurance with just one hour of an online safe driving course with DriveSafe. They are a legitimate DD provider recognized by most major car insurance companies and they will even refund you $25 for a course if your provider doesn’t give you a discount.
Read more: Defensive Driving Class Discount: Save on Auto Insurance
2. Call your provider and ask directly for discounts
Insurance companies are one of the few commercial organizations that are happy to explore ways to save you money.
For context, you can’t go to Costco, fill up a shopping cart, and say, “Get me coupons for all these things.” Costco’s customer service is amazing, but you’ll still probably get a $1.50 hot dog for asking about it.
On the contrary, it does work with insurance companies. You can call your provider and ask a phone representative to help you find discounts.
That’s because insurance companies are now realizing that the dozens of discounts they offer can be tricky to navigate, so they’re generally happy to help you find them and save money.
3. Update your driver profile
While you are on the phone with your insurance agent, this is also a great time to update your driver information.
Remember; your insurance premiums are mostly based on risk factors such as where you park your car at night, how long you drive, how recently your last traffic violation was, etc.
Therefore, if any of these things change and make you less risky, you should tell your health care provider.
Life changes that may result in lower premiums may include, but are not limited to:
- Move to a safer place.
- Parking in a covered space at night.
- New job with shortened road.
- Moving to an area with the best weather.
- Moving to a zip code with a lower crime rate.
Another big problem is your latest move violation. If your last traffic violation was less than three years old when you first got your rate quote and is now more than three years old, this should lower your auto insurance premiums. But providers don’t always automatically account for old traffic violations, so you’ll need to check them to make sure they have your current driving license.
4. Reassess What Coverage You Really Need
A pretty surefire way to lower your insurance rates is to simply buy less.
Do it: start with a clean slate and go through our guide; what type of auto insurance do you need?
Use it to make a “product list” of how many of each type of insurance you think you need. Then compare your listing with the current levels of coverage you’re paying for.
Has anything changed?
To give a few examples, if you work from home these days and don’t drive much, you can probably reduce collision coverage. If you park your car in a garage, you can probably reduce or even cancel your full coverage.
As for the deductible, if you now have enough savings to pay $1,000 or more out of pocket for an unexpected car repair, you can probably safely increase your deductible (thus reducing your insurance premiums significantly).
5. Participate in a telematics program (Progressive Snapshot, GEICO DriveEasy, etc.)
Telematics, also known as driver monitoring, is a convenient way to show your ISP that you are a low-risk driver in real time. Once they see what a safe and sensible driver you are, they will offer you a big discount.
This is how most telematics programs work:
- You agree to participate in the program from your provider’s website, often for an immediate discount of around 10%.
- Your ISP sends you a device to connect to your vehicle’s OBD-II port (or you download an app).
- Over the next three to six months, your provider tracks your driving habits: how slowly you stop, what time of day you drive, etc.
- Depending on your “point” you get an additional discount of up to 40%.
Naturally, the benefits of participating in a telematics program are quite large. If you don’t mind a few months of careful driving, braking and cornering like a grandma eats soup in the passenger seat, you can expect a car insurance discount of almost half your premiums.
However, some people (myself included) don’t like it when Big Brother looks over their shoulder while driving. Telematics devices often beep when they detect a “violation,” which can increase anxiety levels during your daily commute.
However, if you are already riding like a monk, You can also let your provider take a look and get a discount.
6. Look for the best exchange rate
Finally, the most time-tested way to save money on auto insurance is to find a better auto insurance rate.
Each auto insurance provider calculates risk – and therefore your premiums – differently. A working professional woman driving a Hyundai Kona in Austin, Texas, may look like a low-risk driver to one supplier and a reckless driver to another.
You may be stuck with an ISP who, for some reason, sees you as a huge nuisance and charges you a hefty fee for coverage.
This is one of my six reasons to buy car insurance every six months; you want to find the provider that sees you as the least risky (and therefore charges you the least for identical coverage).
And thankfully, getting car insurance quotes online can take as little as five minutes for each provider. Check out our list of the best car insurance companies of 2022 to get you started.
With rising rents and inflation in 2022, budgets may feel tight. Luckily, saving a few hundred dollars on auto insurance is an easy way to loosen your belt buckle.
Between taking a safe driving course, opting for telematics, and just looking for a better deal, you can save more and sleep better.
And to learn more about how to make a dollar, check out How to budget: 4 easy steps to get started.
Featured Image: CHOTTHANIN THITIAKARAKIAT/Shutterstock.com