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Auto insurance is always a source of heartburn for most drivers. And it seems we’re paying more and more for it each year. Yet there are strategies you can start employing immediately to reduce your premium. See below for some that I use (the first three) and others that may apply to you as well.

1. Increase the deductible: It’s simple: if there is an auto claim, the more you agree to pay yourself before the insurance company picks up the tab (the deductible), the lower your premium. I have found a noticeable reduction in my premium by agreeing to a $1,000 deductible, but it may be a different amount for you. Select a figure that you are comfortable with and can afford to pay if there is ever a claim. (Of course, if I ever have a claim less than $1,000, I will have to pay the entire amount since my deductible is higher than the claim.)
2. Insure your home and vehicle with the same insurer: Insurance companies reward you for your loyalty and you can get a discount of up to 15% on your total premium if you give all your business (automobile, home owner or renter’s insurance, etc.) to the same company.
3. Take a defensive driving course: This saved me another 10% on my premium. Call your insurance company and see if they can refer you to a company. If you’re taking the course without the knowledge of your insurance company, check with them to ensure the course content qualifies you for a discount. Defensive driving courses can be expensive (up to $500) but well worth the investment in the long term.
4. Purchase a car that costs less to insure: More expensive cars are often more likely to get stolen and more expensive to repair if they’ve been involved in an accident. Always get an insurance quote prior to purchasing a car - the premium on that red Mustang may be so high that what seemed like a “killer deal” at first is no longer the case.
5. Retrofit your car with security devices: Make sure your insurance company knows of security devices you have installed in your car such as car alarm, satellite tracking service, etc. This additional protection can also get you lower rates.
6. Shop for insurance rates: Auto insurance is one of those things that once established most people forget about. Ask your friends for recommendations and call other insurance companies when your policy is up for renewal - you could get a much better rate from some other company.
7. Don’t speed: Not only is speeding unsafe, speeding tickets can stay on your driving record for up to 5 years (depends on your state or provincial law). And in those years your insurance costs are guaranteed to shoot up - and shopping around is not going to lower your rates substantially either. (Image on the right by Joe Shlabotnik.)
8. Ask about group insurance: You might be in for a nice discount if your employer or an association you’re a part of (alumni, AAA, CAA, etc.) has negotiated a reduced rate with the insurance company. Check with your employer or association and avail the cheaper rate.

Ever seen that GEICO commercial for auto insurance: “15 minutes could save you 15% or more”? Take those 15 minutes to find your auto insurance company’s phone number and your policy number - it will in the insurance paperwork. Often this is the step where most people fail to take action and hence pass up hundreds of dollars in savings each month. Don’t be a fool - make that call today!

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