How to Save Money on Car Insurance: 7 Ways To Reduce Your Costs Right Now

Auto insurance premiums are rising across the US. Don't let that stop you from saving.

Car insurance rates are rising in 2022. Throughout the US, major car insurers are receiving approval for substantial rate increases -- with Geico, Progressive and Allstate leading the way. 

This trend started at the close of last year, with major insurers raising premiums anywhere from 3% to 12%, according to S&P Global Market Intelligence.

Skyrocketing inflation is the primary reason for these rate hikes, driving up prices for goods and services across the US. Along with higher auto insurance rates, gas prices have also hit record highs, making driving more expensive.

Despite these rising costs, there are plenty of ways to keep more money in your pocket. Here's an overview of ways to mitigate increasing insurance costs. 

Increasing your deductible -- your out-of-pocket cost before your insurance will pick up the bill on a claim -- can lower your premium. 

This move might make sense if you aren't driving much right now, do not have a history of accidents on the road or if you need to reduce your monthly costs to stay insured. 

Doing this could cost you later if you're in an accident, though, as you'll have to dish out more money before your carrier covers damages. 

You should make sure you have enough money to pay the higher deductible if you do end up in an accident.

Older cars may not deserve the same insurance attention as your shiny new Tesla or all of the bells and whistles of a Mercedes-type policy. 

If your car is on its last go-round, you may want to cut out collision coverage or comprehensive coverage for that vehicle, both of which cover damages to your car.

Whether you should drop either coverage depends on the value of your car and the relative cost to insure it. 

Experts suggest that if your car is worth less than 10 times the annual premium, buying coverage for that vehicle may not be a cost-effective option. 

One of the quickest ways to check the value is by scrolling through Kelley Blue Book online. 

For example, say your annual premium is $1,600; 10 times that would be $16,000. If your car is worth less than $16,000, then it might make sense to lower insurance coverage for that car.

Carriers may offer discounts if you have a low mileage count, meaning you drive less than the average number of miles per year compared to other Americans. 

Typically, you'd be considered a low-mileage driver if you drive less than 7,500 miles per year, but this isn't a bright-line rule. 

What actually determines if you're a low-mileage driver depends on what state you live in, your age and gender.

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