9 ways to save on car insurance in 2025

Car insurance is expensive. We’ve compiled a list of nine ways to get the lowest car insurance rates possible in 2025. You can see significant savings by applying as many of them as you can.

Start saving today by reconsidering your coverage levels and limits, raising your deductibles, participating in usage-based programs and looking for lesser-known discounts. Other ways to lower rates include shopping around, maintaining a clean driving record and improving your credit score.

Compare quotes and shop for the best rates

Many factors affect insurance rates, from your age and gender to your driving record. However, each insurer decides how to use that information to calculate rates. For example, while one insurer may charge much higher rates for a speeding ticket, another may not bump rates as much if it’s your only infraction.

That’s why shopping around for insurance is so important. Since each insurer has its own formula to calculate car insurance rates, comparing multiple quotes is essential to find the lowest rates available.

As you shop for insurance, compare quotes for individual and bundled policies. Most insurers offer a discount if you bundle policies, such as home and auto. However, that’s not always the best deal. You may find significantly cheaper rates by going with two different insurers.

Shopping around lets you see how each type of policy compares to others from various insurers, allowing you to find the coverage you need at the lowest rates.

Leverage technology to track good driving habits

Many major insurers offer discounts to drivers who participate in telematics programs. These usage-based insurance (UBI) programs record behaviors behind the wheel and offer discounts based on safe driving.

UBI programs use an app, plugin device or technology installed in the vehicle, such as OnStar, to monitor driving habits such as speeding, hard braking, hard acceleration, mileage, and phone usage. This data is used to calculate a discount for good driving.

Usage-based insurance is a good fit for low-mileage drivers and those confident in their driving skills. While most insurers don’t raise rates based on a driver's performance, some do, so be aware before you sign up.

Adjust your coverage levels based on your vehicle’s value and usage

Your car’s age and how you use it could mean car insurance savings.

If you have an older car that isn’t worth much, you may be able to drop comprehensive and collision coverageCollision coverage helps pay for repairs or replacement of your car if it's damaged in an accident, regardless of who is at fault and is subject to a deductible.. Most states require drivers to carry liability insuranceLiability insurance covers sums that an insured becomes legally obligated to pay because of bodily injuries or property damage, or financial losses caused to other people. to pay for damages they cause to other vehicles and property. However, comprehensive and collision coverages, which pay for damages to your car, are only required if it is financed or leased. If you have an older vehicle that is paid off and can afford to repair or replace it out of pocket, dropping full coverage will save you some money.

How you use your car can also lower insurance rates. Driving fewer miles and using public transportation to get to work leads to lower rates since you aren’t on the road much. Check the annual mileage listed on your policy to make sure it’s correct.

Look for additional discounts

Car insurance companies offer numerous discounts, and most allow you to bundle them for maximum savings. Typical savings include multi-policy, paid in full and good driver discounts.

However, some lesser-known car insurance discounts can save a significant amount. Speak with an agent to find any available discounts.

“Insurance companies offer discounts for continuous insurance coverage, so it’s good for consumers to be mindful of keeping a policy for at least six months with the same company and then shopping for new coverage at renewal,” said Dorothy Cato with Skyway Insurance Services in Monroe, N.C.

“Another recommendation we make to customers, depending on their circumstances, is to do a one-year auto policy, rather than a six-month policy because there may be a small discount from the company for that, but more importantly, it keeps you at the same rate for a whole year, instead of increasing every six months at renewal.”

Although one-year policies are unusual, some companies offer them, including Liberty Mutual, The General, and USAA.

Other discounts to look for include:

  • Loyalty
  • Occupational
  • Vehicle safety features
  • Automatic payment
  • Low mileage
  • Defensive driving course
  • Early signing
  • Paperless

Maintain a good credit score

Statistically, drivers with bad credit are more likely to file claims. Insurance companies believe that drivers with bad credit will cost them more money than drivers with good credit. On average, drivers with bad credit pay 76% more.

Make on-time payments, carefully consider how you use credit, and avoid using all your credit lines to get a better credit score. Improving your credit score may take time, but it leads to significantly lower car insurance rates and other financial perks.

Although a few states have banned the use of credit history for car insurance rating, most allow it.

Bundle policies for rate savings

Most major insurers offer drivers a discount for bundling policies. If you have one insurance company handling your home and auto policies, you can save an average of 15% on both policies with bundling.

In addition, having just one insurer to deal with payments and coverage changes is convenient for you.

Avoid small claims to keep your premium low

Filing claims, even small ones, can signal to the insurance company that you will likely cost them money in the future. You are often better off making small repairs yourself rather than filing a claimAn insurance claim is a request you make to your insurance company for coverage after your car is damaged or you have an accident. You can file a claim online, by phone, or in writing., especially if it’s close to the deductibleThe deductible is the amount you pay out of pocket for a covered loss when you file a claim. amount.

Filing an insurance claim can raise your rates for several years. If you can afford to pay for repairs yourself, you can avoid higher car insurance rates that may cost you more in the long run.

Drive safely and keep a clean record

Your driving record is one of the most significant factors determining car insurance rates. Drivers with a clean record typically have much lower rates than drivers with traffic infractions. For example, a DUI raises car insurance rates an average of 90%, and speeding tickets increase rates by 39%.

Obeying traffic laws and practicing defensive driving can ensure you get the lowest car insurance rates available.

Raise your deductible

The deductible is the amount you pay before your insurance kicks in when you file a claim. Raising your car insurance deductible from $500 to $1,000 or higher significantly lowers car insurance rates. 

“Also, it's good to review your policy to make sure your deductibles are correct... Often, customers will have a very low deductible, especially for collision coverage, and this will make your insurance more expensive. If you have a good driving record, it makes sense to have a higher collision deductible from a risk perspective. Essentially, you are betting that you won't have an at-fault accident,” said Cato.

Although your rates will be lower, a higher deductible means more out-of-pocket costs when you file a claim. If you choose to raise your deductible, be sure to set aside enough money to cover it if you file a claim. 

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