9 Ways to Save on Car Insurance in 2025

If you haven’t reviewed your car insurance in a while, there’s a good chance you’re either paying too much, carrying the wrong coverage, or both. Shopping for quotes online can help, but be careful. Some insurance clearinghouses may give inaccurate estimates or even sell your data. A good trick is to use a separate email address just for quote requests.

Here are the top strategies to lower your car insurance premiums while still keeping the protection you need.

Raise Your Deductible

Savings: $464 – $525 per year

By increasing your deductible from $500 to $1,000, you can cut your annual premium by up to 25%. Just make sure you have the cash on hand in case you need to cover repair costs out of pocket.

Drop Collision and Comprehensive on Older Cars

Savings: Around $1,165 per year

As your vehicle’s value decreases, paying for collision and comprehensive coverage may not be worth it. A good rule: if your premium is more than 10% of your car’s value, consider switching to liability-only coverage. Keep comprehensive a bit longer if you want glass coverage for windshield repairs.

Take a Defensive Driving Course

Savings: About $233 per year

Many insurers give discounts for completing a safe-driving class. Costs vary by state, but most courses are affordable and can reduce your premium for several years.

Report Low Mileage

Savings: Around $116 per year

If you drive less than 10,000 miles a year, notify your insurer. Some companies even offer verified mileage programs that reward low-mileage drivers with deeper discounts.

Bundle Your Policies

Savings: Up to 30%

Bundling auto insurance with homeowners (or renters) insurance can unlock big savings. Still, compare bundled vs. separate policies — sometimes splitting coverage between companies is cheaper.

Pay Out of Pocket for Minor Damage

Savings: $348+ per year

For small accidents (like scraping a bumper), paying for repairs yourself may be cheaper than filing a claim, which could increase your premium. Always get a repair estimate before deciding.

Use an Independent Agent

Savings: Hundreds of dollars

Independent insurance agents compare quotes across multiple companies, including smaller insurers you might miss on your own. This can help you find the best car insurance deal for your situation.

Consider Dividend Policies

Savings: 5–20% back

Some insurers, like Amica and NJM, offer dividend policies where you pay slightly higher premiums but get annual payouts based on company performance.

Try Driver Monitoring Programs

Savings: Up to $931 per year

Usage-based programs track your driving habits through an app or device. Safe drivers can earn significant discounts, but be aware that insurers are collecting data about your driving times and behaviors.

How Much Liability Coverage Do You Really Need?

Most states require liability insurance, but the legal minimum is often too low. Experts recommend at least $100,000/$300,000/$100,000 coverage for bodily injury and property damage. For even more protection, consider adding an umbrella policy that extends liability coverage up to $1 million or more.

Also consider adding uninsured/underinsured motorist protection and medical payments coverage to safeguard yourself against drivers with inadequate insurance.

Final Thoughts

Car insurance isn’t just about meeting legal requirements, it’s about protecting your finances. By adjusting your coverage, driving habits, and provider choices, you can cut costs while keeping the protection you need.