Car Insurance Costs And Money-Saving Tips

Car Insurance Costs And Money-Saving Tips bb3 May 29, 2010

By Staff writer State Farm™ Employee

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You've probably figured out that the world of car insurance is well, let's just say it's complex. When you apply for insurance, a company is going to look at many factors.

Type of Car

Generally, the more expensive the car, the more you pay for car insurance.


Because of the higher frequency of issues like theft, accidents, and vandalism, urban drivers may pay more than those in rural areas.

How Much the Car is Driven

People who drive a lot for work or commute a long distance usually pay more than those who drive less.

Age, Sex, and Marital Status

Accident rates are generally higher for drivers under 25, especially men, which often means higher insurance prices. Married drivers may pay less.

Driving Record

Drivers with poor driving records usually pay more for coverage than people who have been accident-free for several years.


Insurance policies consist of a variety of coverages. Generally, the more coverage you buy, the higher the cost.

Credit History

Certain credit information has been shown to be a very effective predictor of future insurance claims. In most states, credit information is one factor used to determine the cost of your car. Maintaining good credit may save you money on your car insurance.


A deductible is the part of a loss that you've agreed to pay with your own money. Generally, the higher the deductible, the lower your premium.

How Can I Save Money?

There are several things you can do to try saving money on car insurance:

  • Buy a cheaper car. Generally, the more expensive the car, the more expensive it is to insure.
  • Do your safety research. Insurers often increase premiums for cars that are a greater risk for damage or occupant injury.
  • Ask about discount. Typical discounts include those for good students, insuring multiple vehicles, accident-free driving, and more.
  • Drive less. Consider joining a car pool, or take alternate transportation when possible. Mileage reduction may help lower your premiums.
  • Drive carefully. Insurers love a clean driving record.
  • Consider Multi-line. Many insurers will offer discounts if you use them for multiple coverages.
Note: Car insurance premiums are determined based on state-approved rating factors.

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