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Cutting Expenses: Car Insurance

As part of my personal finance journey, I’m working hard to cut my expenses so I can allocate more of my monthly income toward paying off debt. I’ve set a goal debt free date, and in order for me to meet this goal I’m going to have to pay extra (above the minimum payments) toward my debt each month.

I should tell you that when I say I’m cutting my expenses, I don’t just mean by limiting my discretionary expenses, like going out to eat and shopping, but I’m also trying to negotiate cheaper rates for my other bills too. These days, no bill is safe in my home.

I’ve called my credit card companies to negotiate lower interest rates. I’ve called to lower my cell phone bill, and even my car insurance bill. Car insurance seems to be one area where lots of people are overpaying and sometimes even paying for services they don’t even use! Here are just a couple of ways I’ve worked to lower my car insurance cost.

Find a Cheaper Plan or Carrier

I’ve been with the same insurance company since I first got my driver’s license at age 14 (learner’s permit), but that doesn’t mean I can’t compare car insurance rates from a different company. I’m not afraid to leave my current insurance company if I can find a significantly better deal.

Negotiate a Better Rate

If you truly don’t want to leave your current car insurance provider, you could try negotiating for a better rate instead. If you’re a long time customer be sure to mention that in the negotiations. You may also have more leverage to ask for a better rate if you have multiple kinds of insurance through the same company, like your home insurance and your car insurance are with the same company.

If you decide to try to negotiate your car insurance to a cheaper rate, you will still need to find the cheapest car insurance for comparable coverage. This will help you to be informed about exactly how much you may be overpaying.

Double Check Your Coverage

You should take time once a year or so to review your coverage with your agent. Make sure you aren’t over or under insured. At one of my annual review appointments, my agent and I discovered that I was paying for a couple of additional options that I’d never used and probably didn’t need. Cancelling these options saved me about $8/month. That may not seem like a lot, but it’s almost $100/year.

At your annual appointment, you should also review the discounts the company offers and make sure every discount you qualify for has applied to your policy properly.

Finding ways to save money on your car insurance is great, but it doesn’t really do you any good unless you use the money in a different, more productive, way. Applying your new monthly savings toward your debt or savings is a good way to put that extra money to work.

Have you ever successfully negotiated lower rates for your bills?

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Erin Thompson

Erin Thompson spent years managing her own blog about budgeting and debt. Because of that, she has great insights not only about managing spending and borrowing but also about running websites profitably. When she's not writing articles for us, she's traveling and looking for new types of wines to try.
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The content on is for informational and educational purposes only. It is not financial advice and we are not certified financial advisors. strives to keep its information accurate and up to date, but it may differ from actual numbers. We may have financial relationships with companies listed on our site. We may receive compensation for the placement of sponsored products or services. We work hard to write authentic and accurate articles.