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20 Ways to Get Cheaper Auto Insurance

Aug. 27, 2021
6 mins
A young couple happily look at documents and a laptop computer

The obvious way to save money on auto insurance is a clean driving record, but you can do more to get a lower premium. Rather than grumble about your rate, it pays to understand how auto insurance works. You may be entitled to discounts and savings you weren’t aware of with your existing provider, or you might be better off going somewhere else for coverage.

Here are 20 ideas that will get you the most bang for your buck.

1. Bundle your cars under the same insurance policy

You can save as much as 20% on your auto insurance if you put all your cars on the same auto insurance policy, as most providers offer a multi-vehicle discount.

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2. Bundle your auto and home insurance policies

Similarly, bundling your home and auto insurance with the same insurer can bring substantial savings through what is called a multi-line discount that can reduce your premiums by as much as 15%.

3. Take advantage of your age

If you’re a senior, recently retired, or over 50, most insurance companies offer additional discounts that can save you up to 10% as long as you’re a good driver.

Meanwhile, a child or young adult who is away attending college or university and only drives the family vehicle when they’re home to visit can also enjoy discounted insurance rates.

4. Take advantage of your degree

Most post-secondary institutions and professional associations offer group insurance discounts for their members or alumni. Often, these details get mentioned in the monthly newsletter, but if you don’t subscribe, there is also the opportunity to ask your insurance agent or broker about it.

5. Check for other discounts

Finding discounts from your existing insurance company is low-hanging fruit when saving money. Most providers offer several standard types. Aside from bundling, ask your provider for a complete list as one may stand out as being ideally suited to your circumstances.

6. Lower your premiums by increasing your deductibles

The higher your deductibles, the less your monthly premiums will be. If you can afford to raise your deductible from $500 to $1,000, you can save as much as 10% on your monthly bill — just be sure you can afford to pay the higher deductible if you need to make a claim.

7. Pay annually instead of monthly

How you decide to pay your monthly premiums can also influence how much your insurance coverage costs. Collecting premiums every month costs your insurance provider money, so if you’re willing and able to pay a lump sum once a year, they’ll give you a discount on your insurance coverage.

8. Pay based on usage

Enrolling in a usage-based insurance (UBI) program can save you about 5% to 10% when you first sign up and as much as 25% annually if you’re a good driver.

By downloading and using a mobile app to monitor how, when, and how far you drive, your provider can track how you drive, including how fast you accelerate and brake, the time of day you’re on the road, trip duration, and speed.

Better driving will qualify you for a discount; however, those exhibiting high-risk behaviours may face a surcharge in Ontario.

9. Start on the right foot

Your driving record is a significant factor in the cost of auto insurance, and there is always room for improvement.

If you’re a new driver, it pays to take a government-recognized driver’s training course as most insurance providers offer a discount to newly licensed drivers who complete one. Such graduates typically pay lower insurance rates than those who haven’t take a course.

10. Don’t drive to work

Insurance rates are higher for people who drive their vehicle to work because the more you drive, the greater the chance of getting in an accident. If you can’t work from home, try taking the bus or carpooling if possible.

Not only will it save you money on your insurance premium, but you’ll also save money on parking, gas, and wear and tear on your vehicle.

11. Drive defensively

Being a cautious and courteous driver at all times and driving the posted speed limit will help you maintain a spotless driving record, which is ultimately one of the most influential factors in determining the premium you pay.

For example, a speeding ticket will affect your insurance rate for up to three years, and accidents stay on your record for at least six years.

Driving distracted can also get you into trouble, so don’t be fidgeting with a mobile device when you’re behind the wheel. If your driving record is full of traffic convictions, you’re sure to pay more for auto insurance.

12. Rotate your tires seasonally

Putting on winter tires rather than driving on all-season ones during the colder months are not only safer but will also get you a discount of close to 5% in Ontario — all insurers in the province must offer this discount. Insurers in Alberta provide similar savings.

13. Drop comprehensive and collision coverage on older vehicles

The vehicle you drive also dictates how much you pay for auto insurance, factoring in its age and condition. If your car is 10 years old or older, consider rethinking your collision and comprehensive coverage.

First, you must weigh the cost of the coverage with the value of your car and your chosen deductibles. It doesn’t make sense to have a deductible of $1,000 on a car that’s only worth $1,000.

14. Drive a “low-risk” car

Insurance rates for cars are based on the claims history for that vehicle and how expensive the car is to repair if it’s damaged in an accident. Also, the more likely a car is to be a target for thieves, the more you’ll pay to insure it.

15. Go green

Many insurance providers offer a discount of up to 10% for drivers with hybrid or electric vehicles. You can help save the environment and save money at the same time.

16. Add an anti-theft device

Newer vehicles are typically equipped with anti-theft protection. Many insurers provide discounts for vehicles with these technologies because they are less likely to be stolen. If your car doesn’t come equipped, you can install it yourself.

17. More coverage isn’t always better

It is possible to have too much coverage, which means you’re paying a higher premium than necessary. Some types of coverage may not apply to you, and increasing your coverage limits may not make financial sense. Make sure you have the right amount of insurance coverage for your specific driving needs.

18. Don’t let your coverage lapse

A gap in your history as an insured driver could impact your premiums and make it more difficult to find coverage.

19. Check-in on your car insurance rates as your life changes

Getting married, turning 60, moving, or retiring are key milestones that can affect your insurance rates. Check with your provider or broker to make sure you’re getting the rate that reflects where you are today.

20. Keep comparing

Car insurance coverage may be standard throughout your province, but insurance premiums are another story. Premiums from one company to the next can vary by hundreds, if not thousands of dollars. The only way to make sure you are getting the best price for your policy is to compare quotes — whether your auto policy is up for renewal or not.

Gary Hilson

Gary Hilson is a Toronto-based freelance writer who has produced thousands of words for print and pixel about business and technology for a variety of publications and corporate clients. When he’s not tapping on the keyboard, Gary collects comic books, attends live theater, constructs Lego, and buys books he always intends to read.

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