Auto Insurance: Can You Negotiate?

While you cannot negotiate auto insurance rates, there are several ways to reduce your auto insurance costs. You can shop around for quotes from multiple insurers and compare prices to find the best rates for you. You can also explore possible discounts, increase your deductible, or switch to pay-per-mile insurance.

Compare quotes from multiple insurers

Comparing quotes from multiple insurers is a great way to save money on car insurance. While you cannot negotiate car insurance rates, you can find lower rates by shopping around and comparing quotes from different companies. Here are some tips to help you compare quotes and get the best deal:

• Use comparison websites: Websites like Insurify, Compare.com, and Policygenius allow you to compare real-time quotes from multiple insurers at once. These sites are free to use and can save you time and money. However, be cautious of lead-generation sites that sell your information to insurance agencies instead of providing actual quotes.
• Get quotes from individual insurers: If you prefer, you can also get quotes directly from insurance companies' websites or by calling them. This may take more time, but it can be a good way to compare a wider range of options.
• Provide accurate information: When getting quotes, make sure to provide accurate and detailed information about yourself, your vehicle, and your driving history. This includes your age, address, vehicle make and model, driving record, and insurance coverage preferences. The more accurate your information is, the more accurate your quotes will be.
• Compare the same coverage options: To make a true comparison, be sure to request quotes for the same coverage levels and deductibles from each insurer. This will allow you to see which company is offering the best price for the coverage you need.
• Consider discounts: Different insurers offer different discounts, such as good driver discounts, multi-policy discounts, or discounts for safety features. Be sure to ask about any discounts you may be eligible for and consider how these can impact your overall cost.
• Read reviews: Before choosing an insurer, be sure to read reviews and research their customer service, claims process, and financial stability. Choosing a reputable company with good reviews can help ensure a positive experience if you ever need to file a claim.

Ask about available discounts

While you cannot negotiate car insurance rates, you can ask about available discounts to lower your premium. Discounts vary from one provider to another, but there are some common savings opportunities that many providers offer.

Some of the most common car insurance discounts include:

• Multi-policy: This discount is awarded for buying more than one policy from the same company. The most common package is an auto and home discount, but some companies offer savings for buying other lines of insurance, like life or business policies.
• Multi-vehicle: If you have more than one vehicle, insuring them with the same company might get you a discount.
• Safe driver: Having a clean driving record, which typically means you have no at-fault accidents, tickets, or DUI convictions in the past several years, can help you avoid premium surcharges.
• Vehicle safety features: Insuring a car with safety equipment like side curtain airbags, anti-lock brakes, or an automatic braking system to help avoid forward collisions often means you will pay less for insurance.
• Pay-in-full: You might be able to avoid paying instalment fees and may get a discount if you pay your car insurance in full, rather than monthly or quarterly.
• Paperless: When you choose to go paperless, the insurance company often gives you a discount since they can save on printing and postage costs.

Other common discounts include savings for good students, students at college without cars, participating in a telematics program, or signing up for paperless billing. Reviewing a company's discounts and taking advantage of as many as you qualify for can help you fit your car insurance premium into your budget.

Increase your policy deductible

While you cannot negotiate car insurance rates, you can save money on your premiums in other ways. One way to do this is to increase your policy deductible.

A deductible is the amount you pay before your insurance policy kicks in. By requesting a higher deductible, you can lower your premium prices. For example, increasing your deductible from $200 to $500 could reduce your collision and comprehensive coverage cost by 15 to 30%. Going to a $1,000 deductible can save you 40% or more. However, before choosing a higher deductible, ensure you have enough money set aside to pay it if you need to file a claim.

If you have a good amount of savings and don't drive very often, increasing your deductible could be a good option for you. You can dip into your savings to cover your deductible and enjoy lower premium costs, which could help you build your emergency fund. However, if your savings aren't strong, it's best to wait until you've built up more savings before making this change.

It's also important to note that the amount of premium savings you gain by increasing your deductible may depend on other factors such as the value of your vehicle, your driving record, and the number of miles driven. In some cases, you may find that increasing your deductible above a certain point will not return enough in premium savings to make it worthwhile. Therefore, it's a good idea to compare pricing using several deductible options from different insurance providers to determine the best value for your situation.

Consider switching to pay-per-mile insurance

While it is not possible to negotiate with a car insurance company, you can consider switching to pay-per-mile insurance to save money. Pay-per-mile insurance is a relatively new type of policy that charges customers a premium based on their actual mileage. This type of insurance is ideal for people who drive less than 12,000 miles annually, which is the national average.

With pay-per-mile insurance, customers pay a daily or monthly base rate, plus a per-mile fee of about 2-10 cents. The base rate and per-mile fee are calculated using standard rating factors, including driving record, age, gender, ZIP code, and vehicle. Most pay-per-mile insurance policies use a device that tracks your mileage, or a mobile app. Typically, the device plugs into your vehicle's onboard diagnostic port under the dashboard, while the app can be downloaded straight to your smartphone.

Some of the best pay-per-mile insurance companies include Allstate, Metromile, and Mile Auto, as they offer competitive rates and easy-to-use programs. USAA, Nationwide, and Progressive also offer pay-per-mile insurance options.

Before switching to pay-per-mile insurance, it is important to check the availability of this type of policy in your state, as it is not available everywhere. Additionally, most pay-per-mile companies require customers to drive a car from 1996 or later, which is compatible with a mileage-tracking device.

Remove comprehensive insurance from a full-coverage policy

While it is not possible to negotiate with a car insurance company, there are some steps you can take to lower your rates. One such step is to understand your coverage and remove any parts of your policy that you don't need. If you have a full-coverage policy, you may want to consider removing comprehensive insurance.

Comprehensive insurance is a type of automobile insurance that covers damage to your car from causes other than a collision. This includes damage from animals, natural disasters, theft, vandalism, and more. It is typically required by lenders if you lease or finance your vehicle. However, if your vehicle is paid off, you may want to consider removing comprehensive coverage from your policy, especially if your car has a low market value.

For example, if your car is only worth a few thousand dollars, the potential insurance payout may not be worth the price of the coverage. In this case, you would pay for any vehicle damage out of your own pocket if you're at fault in an accident or your car is damaged due to an incident beyond your control.

Before removing comprehensive insurance from your policy, it's important to consider the risks. Comprehensive insurance can protect you from costly repairs if your car is damaged by something other than a collision. If you live in an area where natural disasters, animal collisions, or theft are common, comprehensive insurance may be worth keeping.

Additionally, keep in mind that you may still want to maintain some level of coverage, even if you remove comprehensive insurance. Uninsured motorist bodily injury and property damage coverage can protect you if your vehicle is damaged by a driver without insurance or with insufficient insurance.

Frequently asked questions