Can You Negotiate Car Insurance? How to Get Lower Rates
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Written byMargaret Wack
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Margaret Wack is an auto insurance writer for Compare.com. She has written about insurance and personal finance for brands and publications including Investopedia, Bankrate, MoneyGeek, The Insurance Bulletin, and more. Margaret earned a bachelor's degree in classics, comparative literature, and poetry from Smith College and an interdisciplinary master's degree from St. John's College.
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Edited byNick Versaw
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Nick Versaw leads Compare.com's editorial department, where he and his team specialize in crafting helpful, easy-to-understand content about car insurance and other related topics. With nearly a decade of experience writing and editing insurance and personal finance articles, his work has helped readers discover substantial savings on necessary expenses, including insurance, transportation, health care, and more. As an award-winning writer, Nick has seen his work published in countless renowned publications, such as the Washington Post, Los Angeles Times, and U.S. News & World Report. He graduated with Latin honors from Virginia Commonwealth University, where he earned his Bachelor's Degree in Digital Journalism.
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It’s the stuff of cliché commercials for a reason — we all want to save money on car insurance. But if you are wondering, "Can you negotiate car insurance to lower your rates," we have some unfortunate news. Unlike other financial products or monthly bills, it’s not usually possible to negotiate your premium with an insurer.
But don’t lose hope. There are a few other tactics you can use to save, including shopping around for your policy and taking advantage of discounts and special offers.
In this article, we’ll cover why it’s not possible to negotiate your car insurance premiums, along with how to still get a good deal on your policy.
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Can You Negotiate Car Insurance Rates?
Unlike negotiating bills with utility companies, banks, and other lenders, it’s not possible to negotiate your car insurance premium with your insurance company. This is because the auto insurance industry and the cost of car insurance are heavily regulated, and companies must comply with certain state and local regulations.
Each year, car insurance companies submit the proprietary formulas that they use to determine rates to the states in which they operate. After that, they’re not allowed to change these formulas (or the rates themselves). While this is a good thing in that it helps prevent insurers from gouging customers, it also means that it’s impossible to get a better rate simply by calling your insurance company and asking for it.
If you find a cheaper price elsewhere, for example, you can’t get your current insurer to change their rates as a result. But you’re always free to switch insurance providers, and there are several other ways to lower your car insurance prices besides negotiating.
Other Ways to Lower Your Car Insurance Bill
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With average auto insurance costs of $1,070 nationwide, it’s no surprise that drivers are looking for ways to lower their bills. Luckily, there are a few different strategies that can help to drive your premiums down.
For one, it’s a good idea to regularly shop around for car insurance to see if you’re eligible for a lower rate elsewhere. You can also take advantage of discounts and special offers to get a better deal. In some cases, you may even want to consider lowering the coverage amounts on your policy to save money.
Shop Around for a Better Policy
Shopping around and getting personalized insurance quotes from different providers is one of the best ways to lower your car insurance bill. Experts recommend shopping and comparing insurance companies around every 6-12 months to ensure you’re getting the best rate.
Since different insurance companies weigh car insurance factors like your driving history, vehicle type, age, credit score, and gender differently, you may qualify for lower rates from a different provider. This is also one reason why personalized quotes are much more accurate than generic estimates since they take key personal information into account to provide you with a more accurate rate.
Some insurers may also offer pay-per-mile car insurance or usage-based insurance. Pay-per-mile insurance rewards drivers who drive fewer miles with less expensive rates and may be a good fit for those who work from home or only drive occasionally.
Usage-based insurance calculates your insurance premium depending on a wide variety of factors, including how fast you drive, what time of day you drive, how far you drive, acceleration and breaking, and more. It can be a good fit for responsible drivers looking for a policy that rewards safe driving.
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Search Out Deals and Discounts
You can also lower car insurance premiums by searching out deals and discounts.
Some of the most popular car insurance discounts include:
Discounts for multi-policy bundling, like renters or homeowners insurance and auto insurance policies
Discounts for prepayment or payment in full
Discounts for automatic billing and paperless billing
Discounts for safe drivers and drivers with few claims
Discounts for completing a defensive driving course
Discounts for good students
Discounts for safety features like anti-lock brakes
Discounts for members of certain groups or organizations
While discounts may not save you a ton of money each month, they’re one of the simplest ways policyholders can lower car insurance premiums, and they’re worth taking advantage of. Instead of asking if you can negotiate car insurance rates, ask your insurance agent to see which deals you may qualify for.
Consider Lower Coverage Amounts
States set minimum coverage requirements for car insurance. Still, it’s a good idea to exceed the state minimums and purchase as much car insurance as you can comfortably afford. A robust car insurance policy is an investment that can help protect you financially in the case of a car accident. That said, there’s a chance you may be paying for more car insurance coverage than you need.
If you’re looking to lower your premiums, it’s a good idea to review your car insurance coverage and lower or eliminate coverage that no longer serves your needs. Depending on your situation, you may not need "full coverage" auto insurance, which usually includes liability insurance, uninsured/underinsured motorist insurance, collision insurance, and comprehensive insurance.
For example, you may want to forgo collision coverage if you have an older car. Similarly, if you have very high bodily injury and property damage liability insurance coverage limits, you may want to reduce them to the standard recommendation of 100/300/100 coverage.
You can also consider a higher deductible for collision and comprehensive coverage to lower your insurance costs. For example, if you have a $0 comprehensive deductible, you might want to raise it to $500.
Keep in mind that lowering your coverage amounts or raising your deductibles does come with a risk — you’ll have less financial protection if you end up having to file an insurance claim. If you’re unsure what coverage types and amounts are right for you, it’s a good idea to chat with an insurance agent about your coverage options.
Consider Your Vehicle Choice
If you’re driving a swanky new car, odds are you’ll be paying much more for car insurance than someone driving around a beat-up, 20-year-old ride.
While it usually doesn’t make sense to go with an older, less valuable car solely to lower your car insurance premiums, it’s definitely something you should consider when purchasing a new or used car.
This is especially important since, if you lease or finance your car, most lenders will require you to purchase comprehensive and collision coverage, which are otherwise optional. The higher your vehicle’s value, the more you’ll pay for these types of coverage.
Give It Time
Like many things in life, your car insurance rates sometimes get better with age. Rates tend to be highest for young adults in their teens and early twenties and decline over time until drivers reach their senior years. This is because insurance providers see young drivers as riskier, while older drivers may be less likely to get into an accident.
If you've recently been in an accident or gotten a ticket, this can also affect your car insurance policy. These incidents typically stay on your driving record for 3-5 years, so if it’s been a while since you’ve filed a claim, you may qualify for a better rate.
Car Insurance Made Easy
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Can you negotiate car insurance? No. But there are other ways to lower premiums. These include shopping around to find the insurer with the cheapest rates, looking for discounts and deals, and reviewing your auto insurance coverage to ensure you’re only paying for what you need.
We make it easy to compare rates from dozens of auto insurance companies in just a few minutes. Browse insurers and start saving today!
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Margaret WackInsurance Writer
Margaret Wack is an auto insurance writer for Compare.com. She has written about insurance and personal finance for brands and publications including Investopedia, Bankrate, MoneyGeek, The Insurance Bulletin, and more. Margaret earned a bachelor's degree in classics, comparative literature, and poetry from Smith College and an interdisciplinary master's degree from St. John's College.
Nick Versaw leads Compare.com's editorial department, where he and his team specialize in crafting helpful, easy-to-understand content about car insurance and other related topics. With nearly a decade of experience writing and editing insurance and personal finance articles, his work has helped readers discover substantial savings on necessary expenses, including insurance, transportation, health care, and more. As an award-winning writer, Nick has seen his work published in countless renowned publications, such as the Washington Post, Los Angeles Times, and U.S. News & World Report. He graduated with Latin honors from Virginia Commonwealth University, where he earned his Bachelor's Degree in Digital Journalism.
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