Here's how to lower your car insurance premium in 2024

As we've seen over the past couple of years, one of the biggest drivers of inflation has been car insurance — with car insurance premium costs up over 20% in the past year alone. Over five years, rates have gone up 88% in Florida and 50% in New York, Nevada and Colorado, to cite a few examples. Insurance now costs the typical car owner $212 per month, or $2,545 per year, according to Bankrate. Some of this is due to factors that consumers can't necessarily control, such as the high cost of collision repairs involving modern driver-assist technology.

So what can we do to save money on car insurance? Several things, actually.

How to lower your car insurance rate:

Stop speeding: This is the biggest step we can take by far. Speed kills. It also maims, injures, dents and damages. As a nation, we've been on a speeding spree ever since the Covid pandemic. It caused a spike in traffic deaths that is only now beginning to subside. In 2021, the latest year for which NHTSA has full data, 28% of fatal crashes, 13% of injury crashes, and 9% of property-damage-only crashes involved excessive speed — 12,330 people lost their lives in those crashes.

The payoff to your insurance bill from observing speed limits might not be immediate, but eventually the virtuous cycle of less speeding equals few crashes equals few claims will pay off. (That is, if most or all of us do it.) Then again, there is one way to make safe driving pay off right now. We'll get to that in a moment.

Consumer Reports just published a list of other ways that you the insurance customer, can whittle your premiums down:

Switch insurance companies: Most of us tend to pick an insurer and stick with it, instead of playing the field. According to a CR reader survey, consumers who switched said they got better rates and better service. So, make insurance companies compete. CR suggests reviewing your coverage on an annual basis. And to facilitate that suggestion, CR says ...

Get an independent insurance agent: Someone who represents several insurers will make it easier to compare and switch.

Increase your deductible: CR says this could save you $400-$500 a year. The deductible is what you'd pay out of pocket on a claim, before the insurer covers the rest. Increasing the deductible from $500 to $1,000 could bring your premium down by 20-25%. You just need to have money in the bank to cover a bigger deductible if needed, but you might go many years without filing a claim.

Drop collision and comprehensive coverage: Savings, up to $1,000 a year. If you're driving an older car with diminishing value, this makes lots of sense. CR offers a formula: If your insurance premium is more than 10% of the market replacement value of your ride, drop these coverages.

Take a driving refresher course: Savings, $200 a year. You may think you're a great driver, and maybe you are, and maybe this idea sounds silly to you. But in some states you can get a 10% cut on your insurance. These courses cost just a bit of your time and as little as 25 bucks. And who knows, you might learn something.

Report your mileage: Save $100. Maybe you aren't driving as much since the pandemic. Report your annual mileage to your insurer. They base your rates on the mileage they expect a typical customer to drive. If it's less than 10,000 miles a year, you're in luck. Meanwhile, maybe you own a garage queen, say a convertible that only comes out a few days in summer. For truly low-mileage vehicles, there are insurers who will literally cover you on a pay-per-mile basis.

Bundle with your home insurance: Savings, $300, and you'll have the convenience of paying it all in one check.

Pay out of pocket on minor single-vehicle dings and dents: CR says you'll save $300. We're not sure what they mean by that, other than the unrealized amount your coverage might increase if you had filed a claim. Just keep in mind that with modern tech-laden cars, even a minor fender-bender can be an expensive repair. But out-of-pocket might still make sense in the long run, and it keeps your driving record clean.

Buy a dividend policy: Save $100 or more. Some insurers, like Amica, offer these policies, in which you're basically a stockholder who receives a dividend — it's market based but in the range of 5% to 20%. The premium cost might be higher, but it winds up being a net gain.

And here's a biggie, though you might not like the sound of it:

Sign up for driver monitoring: You could save $800, CR claims. The insurance company will monitor your driving habits via a phone app or by plugging a device into your car. You'll definitely want to ask questions about how the data will be used to calculate savings, how much savings you could earn, whether your data will be sold to a third party, etc. You've probably got plenty of phone apps that are gathering data on you right now, of course. But tracking movements and recording driving behavior certainly feels more personal and intrusive. Returning to our advice to stop speeding, here's one way that good driving habits could pay off for you immediately.

CR offered a couple of other suggestions:

Don't skim on liability coverage! This is the insurance you're required to carry, and the amount you're covered for might just not be enough. If you're going by the minimum required by your state, it's definitely not enough. Loretta Worters of the Insurance Information Institute told CR that the institute recommends minimum liability coverage of $100,000/$300,000/$100,000 (that's for "bodily injury liability per person / bodily injury liability limit per accident / property damage.") You'd also be smart to get an "umbrella policy" that has liability protection of $1 million or more and covers both auto and home (since you're bundling). Also, insurance against uninsured motorists is always a good idea.

If you're older, watch your insurance premiums carefully: We all know that a teenager in the family raises our insurance rates. Conversely, rates tend to go down as we age. Older drivers are more experienced, more mature, more careful. But after age 70, you might see a sharp increase in what you're asked to pay. That's the time to go shopping for a different insurer. You can also take refresher driver education course to get a break in your rates, offered by AAA, AARP or agencies or driving schools in your area. Lists of senior driver-education resources are available online. We have more advice for senior drivers here.