Why are car keys so expensive? A $400 lesson learned from losing my car keys.
Isn’t it just a piece of metal? Why are car keys so expensive today?
American consumers seem to be spending a little more on everything these days. You’re spending more on car insurance.
Auto insurance premiums rose by about two-thirds from April 2020 to April 2026, according to federal data. Bankrate reports that in 2025, the average American motorist paid $2,638 for full coverage insurance. Thankfully, premiums have leveled off over the past year.
Insurance premiums are rising because cars and trucks have become so expensive. That means it will cost more to repair or replace.
A surge in serious car accidents and associated medical costs during the years of the pandemic have further increased insurance premiums.
“People have engaged in more risky driving behaviors during the pandemic,” said Matt Brannon, senior economic analyst at Insurify.
Fortunately, there are some easy and more difficult ways to reduce your premiums.
Here are 10 tips from experts.
Find the best car insurance
Although it takes time to find a new insurance company, you can significantly reduce your annual premiums by switching.
Despite constant television advertising, some insurance companies tend to offer better deals. Bankrate’s analysis found that there is a difference of more than $1,000 between the lowest and highest annual full-coverage premiums for major companies. Here are some averages:
- USAA: $2,059
- Geico: $2,167
- Progressive: $2,190
- State Farm: $2,686
- Allstate: $3,355
Insurance companies use a variety of formulas to calculate your premiums, but they typically take into account factors such as your age, location, driving history, and credit score.
Bankrate, Insurify, and others offer online tools to compare quotes.
“Comparing auto insurance rates is one of the lowest-effort and most rewarding ways people can save money on auto insurance,” Brannon says.
Consumer Reports senior auto reporter Keith Barry said you should also consider working with an independent insurance agent. Rather than representing a single insurance company, an independent agent represents multiple insurance companies.
“Working with an independent broker can be the key to hidden savings,” he says. “There are some top insurance companies that only work with independent brokers.”
increase deductible amount
It may sound scary, but it’s a quick, easy, and valuable solution. It increases your deductible, or the amount of cash you pay before insurance kicks in.
Many policies come with a $500 deductible. According to Consumer Reports, doubling that amount to $1,000 can reduce your annual premium by 20 to 25 percent.
Experts argue that raising deductibles makes sense because most drivers rarely make insurance claims.
“Unless you have a deductible accident every year, you’re going to be at the top of the list,” Barry said.
Drop collision and comprehensive coverage
Waive collision coverage? This also seems like a dangerous thing to do. It’s possible if you own a car that’s really worth it.
Collision insurance pays for damage to your car if you get into an accident. Comprehensive coverage for damages other than collisions.
Experts say drivers should consider getting rid of both if they have an older car that has declined in value.
A rule of thumb in the insurance industry is that if your annual premium is more than 10% of your vehicle’s value, you should consider terminating your collision and comprehensive coverage.
Why: If your car is damaged, you could end up paying more in compensation than you receive from your insurance company.
“If your car is worth $3,000 and your deductible is $1,000, you could end up paying up to $2,000,” said Rod Butt, an insurance analyst at LendingTree.
Take a defensive driving course
Depending on your insurance company, you may receive a discount if you take an approved safe driving course.
In New York state, for example, you can get a 10% discount on your auto insurance if you take a state-approved course (costing about $25), according to Consumer Reports. It can also be repeated every three years.
“The discount can be just over $100 a year,” Barry says. “But it’s up to the state and it’s up to the insurance company.”
look for discounts
Car insurance companies usually offer various discounts. You may be able to lower your insurance premium in the following ways:
- Insure multiple vehicles
- Bundle multiple policies from the same insurance company
- be a good student
- serving in the military
- Reduced annual mileage
- Own a car with plenty of safety features
- Become a safe driver
- Be honest with your insurance company
- Pay the entire premium in advance
- Use automatic premium payments
Insurance companies automatically apply some discounts. For others, you need to ask.
Consider safe driving apps
One way to save money on your car insurance is to enroll in a driver monitoring program.
According to Consumer Reports, this evolving technology uses apps, plug-in devices, or electronic tags to monitor driving. This program measures your speed, braking, driving and texting habits, and more.
“If you’re a good driver, you can save 10% to 20%, even 30%,” says Butt. “It depends on the company, but you have to read the fine print. Some companies will increase your pay if you drive poorly.”
And then there are privacy concerns.
Work on your credit score
Insurance companies often take credit into account when setting premiums. Some states prohibit insurance companies from using credit as a factor, but drivers with bad credit tend to pay more.
Good credit doesn’t happen overnight, but as your score improves, your insurance premiums may be lower over time.
“If you pay down your debts and avoid late payments in the long run, you’ll get lower premiums and stay in a better position,” Mr Butt said.
Become a better driver
Maintaining a clean driving record is a great way to lower your insurance premiums.
This means you can avoid accidents that could cause your insurance premiums to skyrocket. Expensive ones include speeding tickets, accidents that were your fault, and DUI convictions.
“Safe driving record is generally the most important factor in auto insurance,” Brannon says.
And keeping a clean driving record isn’t as difficult as you might think.
“The biggest contributing factors to serious crashes are speed, impairment and distraction,” Butt said. “And these are things you can control.”
buy cheap car
The last time you bought a new car, you probably noticed that your wallet took a big hit. The more valuable your car is, the more expensive it will be to insure.
Vehicles with lower values tend to be cheaper to insure because they generally cost less to repair or replace.
Luxury or “high-performance” cars, meaning cars with powerful engines, tend to cost more to insure.
“Depending on the type of car you drive, you could save hundreds of dollars a year,” Barry says.
Please check before updating
Experts advise taking a close look at your insurance policy every six months. Make sure you don’t pay for insurance you don’t need or miss out on potential savings.
You may also need to review your insurance policy after a major life change such as moving. new job. There has been a change in commuting. Marriage or divorce? If you add or lose a driver in your family. retirement.
“That’s when it’s time to check your insurance policy,” Barry says. “They can change your premiums.”
