Save on car insurance, even if it's your first time buying

There’s a lot of wiggle room in between having enough coverage in case of an accident and not paying extra for coverage you may not need. It can be confusing to navigate the lawyer-speak in a policy, especially if you’re buying insurance for the first time. But with a little research, you can save money on auto insurance.

Getting a quote should always be free

First things first: No reputable company will ever charge for an insurance quote. There’s your first money-saving (and scam-avoiding) tip.

Choose at least three companies to compare

Don’t call your favorite or most-well known insurance company and take their first quote. Ask friends and family about their experience with companies and agents. Websites like The Zebra and insurify.com let you compare prices from multiple companies.

If you’re willing to comparison shop in person and not just online, there can be advantages to speaking to an insurance agent — whether it’s an independent agent or an agent who sells policies from only one company. Independent agents might be more familiar with smaller, regional insurance companies that can save you money. However, independent agents can’t quote rates from companies that only sell through their own agents.

Talking to an agent in person can also be helpful if you’re buying car insurance for the first time; it can help to have someone walk you through the different kinds of coverage that may be required and what is optional. They can also help you customize a policy, which isn’t always possible or easy with online quotes.

When using an online quote comparison site, be aware of the difference between quote-comparison sites and lead-generation sites. Quote-comparison sites let you see quotes from various insurers. If you choose one, the site will transfer your information to only that company to complete the process. Lead-generation sites provide your information to several companies who will then contact you using the information you provided online.

Here is a list of insurance companies to get you started. You can also research members of professional insurance organizations, such as the National Association of Professional Insurance Agents.

Gather your information

For everyone included on the policy, you’ll need a driver’s license number, previous insurer (if any), annual and current mileage on the car, vehicle information including the Vehicle Identification Number, and driving history including tickets and accidents. (Be honest about that last one; companies can easily find the information, so you don’t want to leave anything out.)

Learn the lingo

Here’s where insurance shopping gets tricky — and why it can be helpful to work with an insurance agent, especially when you’re buying your first policy. This dictionary of auto insurance terms is written in plain language and is a must-read before you shop online or in person. You want to know enough to buy the right amount of insurance for your circumstances.

Compare insurance costs before you buy a car

If you are in the market for a new or new-to-you car, research insurance costs before signing on the dotted line. Premiums are based partly on the car’s price, safety record, expected repair costs, and even that car model’s likelihood to be stolen.

You may be able to get a discount for buying a car with safety features added, or for a car that is deemed to be a safer option. The Insurance Institute for Highway Safety rates vehicles for safety as well as providing information on insurance losses by make and model — including losses from theft.

Consider raising your deductible

You can lower monthly premium costs by raising the minimum on your out-of-pocket deductible. If you are a safe driver with a clear driving history, this might be the way to go. A smart option would be to create a savings account to cover any additional expenses if you find you have to make a policy claim.

Lose the extras on an older car

If you are driving an older car that has little value, carrying collision or comprehensive insurance might not make any sense. Check the value of your car with the Kelley Blue Book or National Association of Auto Dealers.

Use the same company for all your insurance needs

Some insurance companies offer bundled rates to customers who hold auto, home, or other policies with the same agent or agency, or have more than one vehicle that is covered.

Once you have decided on an agency and obtained insurance, here are some tips to save money down the road:

Keep your credit history clean

Establishing a solid credit history can help lower insurance costs. Many insurers will use your credit information to price auto insurance policies — both when you are purchasing insurance and when your policy is up for renewal. Insurers believe that customers who work to maintain a good credit rating are less of a risk and that these customers are likely to drive more safely, maintain their vehicle and file fewer claims.

To be sure you’re getting the good credit you deserve, it’s a good idea to check your credit report regularly to be sure all information is accurate.

Never let your insurance lapse

Once your policy expires, you will be considered a higher risk. As a result, your policy rates could cost more.

Review your policy annually

You might need more liability coverage to include a new teen driver, or less theft or damage coverage as your vehicle gets older and less valuable. You could also be eligible for discounts as you age — many reputable companies offer a special price to older policy holders. But when “older” turns to “elderly,” your premiums could increase.

Don’t overinsure vehicles you don’t drive

If you are paying premiums on vehicles that are being restored, stored or no longer in use, talk to your insurance company about changing the policy to what is often called a “storage policy.” There is no need to pay collision insurance on a vehicle that is sitting in the garage or out of use.

However, be sure to keep your registration active and up-to-date. That will save time at the DMV when the vehicle is back on the road, and time is money, after all.

Ask for the special discounts

As we noted above, there might be a discount for aging drivers. But there are also opportunities for teachers, law enforcement officials, and other groups that could vary by company. Some companies offer reductions to drivers who get insurance through a group plan from their employers or from other associations. Check with your affiliated organizations to see what they offer.

Take advantage of low mileage discounts

Do you drive back and forth to work just a few miles away from home? Do you log in a small number of miles per week? Some companies will give discounts to motorists who drive less than a set average number of miles per year. Low mileage discounts can also apply to drivers who carpool to work.

Take a driver training class

Most insurance companies offer discounts for approved driver-training courses, such as those offered by the AAA, and may even require one for a new teen driver. It’s a good idea even without a premium discount.

I’m a great believer in an occasional refresher lesson from a pro, who can show you accident avoidance techniques you didn’t know that you didn’t know. Taking special classes by the DMV, such as motorcycle training or semi-tractor training, can also lower insurance premiums. Not all companies do this, but it is worth a call to your agency to find out.

Drive safely

Now that you have a car that has as many safety features as you can afford, and you have purchased a policy, don’t take chances with your driving. Use defensive driving tactics, avoid road rage situations, and follow road rules to minimize the chance you’ll have to file a claim.