How to get a better deal from your current car insurance company

Chris Kissell

Every time you turn on the TV, another car insurance company is advertising super-low rates. You love your current insurer, but the ads make you wonder whether you can get a better deal.

Quite possibly, says Pete Moraga, a spokesman for the nonprofit Insurance Information Network of California.

“The odds are really good that your own insurance company would want to keep your business, especially if you’re a good driver,” he says.

Call your current company or agent and say that you’ve received a lower quote from another insurer. “Chances are that they will try to do what they can to keep you as a customer,” Moraga says.

No-haggle pricing

However, it’s probably unrealistic to expect insurers to negotiate your insurance rate the way you would haggle over the price of a car.

Insurance rates are set by established formulas that include things that are hard to fudge, such as: 

• The claims history of the make and model of car you drive.
• Your driving history.
• Age and gender.
• Your credit score.
• Where you live.

Instead of renegotiating your rate, you’ll need to look for other avenues to save money. Lori Conarton, spokeswoman for the nonprofit Insurance Institute of Michigan, says it all starts with a conversation.

“The best way to get a lower rate is for consumers to take time to meet with their agent or company and make sure they have the coverages that best fit their needs,” Conarton says.

Meeting with an agent can help you figure out whether you have too much coverage, or the wrong type of coverage, for your particular life circumstances.

For example, perhaps it’s time drop the comprehensive and collision coverage on your 11-year-old, paid-off sedan with the hanging bumper and rusted exterior. Comprehensive and collision coverage is optional, but auto lenders typically require it.

Maybe you have an exceptionally low deductible that requires you to pay unnecessarily high annual premiums. Or you might still be paying for your insurer’s roadside assistance coverage even though you get such coverage for free from the manufacturer of your new car.

Since change is a one constant in our lives, it’s important to revisit your insurance needs regularly with your insurance agent or company, says Lynne McChristian, Florida representative for the nonprofit Insurance Information Institute.

“I always recommend that people have an annual conversation with their insurer to review their coverage,” she says.

Finding discounts

Other ways are available to cut the rate you’ve got with your current insurer. One of the best is to ask about your insurer’s various discounts, Conarton says.

Moraga agrees that discounts can be among the best ways to pare down costs with your current insurer. For instance, he says, some insurers offer discounts to teachers.

Your insurer may offer you discounts for any of the following: 

• Installing antitheft devices.
• Buying your auto and home insurance coverage from the same company.
• Taking a defensive driving course.
• Driving fewer miles than average.
• Using your car for pleasure use instead of commuting each day to work.
• Staying with your insurer for several years.
• Having no accidents or traffic infractions over the past three years.
• Getting good grades as a student.

More ways to save

Another great way to save is to bump up your deductible, McChristian says.

“Requesting a higher deductible can lower your costs substantially,” she says. “Before you do that, however, make sure you have enough money set aside to pay that deductible if you have to file a claim.”

Too many people forget that as their lives change, so do their insurance needs. During an annual discussion with your agent, make sure you highlight any major changes that have occurred in your life, McChristian says. These can lead to savings.

For example, you can save if you recently began working full time at home, took a job closer to your home or joined a car pool. In each case, she says, “your mileage goes down, and so do your premiums.”

Also, let your insurance company know whether your credit score has gone up. “You can get lower rates if your credit history improves,” McChristian says. “Most auto insurers use credit information to price auto insurance policies.”

If you’re in the market for a new car, another way to save is to ask your insurer how much it will cost to insure the various makes and models of cars you’re considering.

If all other things are equal, select the car model that will save you the most money on your insurance. Concentrate on cars that have good safety records and notable safety features, Moraga says. Both the Insurance Institute for Highway Safety and the National Highway Traffic Safety Administration grade cars on how well they hold up in test crashes.

“If it’s a safe car, it will cost less to insure,” Moraga says.