Your driving has probably changed in the past year, thanks to the pandemic. Now it’s time to make the most of that shift to get the best deal you can on your 2021 car insurance policy.
Strategies to save on car insurance this year include some new twists on one of the oldest and surest ways to save on your policy: to shop around for it. Reaching out to multiple carriers, rather than automatically renewing with your current carrier, allows you to know how your renewal rate stacks up. And it could well save you money — as it did for nearly two thirds of readers in a 2019 Consumer Reports poll.
Shopping around at least every year or two especially makes sense when your driving habits may have changed in the past year, as is the case for many, even most Americans, in 2020. And the premium quoted by the cheapest insurer can be hundreds — and sometimes even thousands — of dollars less than the most expensive one, according to a price survey by Carinsurance.com.
Here are steps that make particular sense in 2021 to get the best deal on car insurance.
Shop online for insurance
Plenty of people still shop for insurance by making phone calls or even, the pandemic permitting, in-person visits to insurance companies or their agents. But there’s less need to do so thanks to new websites that do the shopping for you.
With a surge in online shopping — Americans made 44% more purchases on the internet last year than in 2019 — car insurers are enhancing their digital shopping tools and new sites are launching, according to Jaimie Pickles, insurance GM at shopping analysis company Jornaya.
Pickles says most insurers, even including older major carriers, now allow you to get a quote online and follow through to buy a policy. And several types of startup sites allow you to enter data once and then receive recommendations and links to multiple insurers.
Startup online brokers such as The Zebra complete getting a quote within their websites. Comparison services such as Gabi and Money’s new car-insurance comparison tool pitch you to prospective insurers, and then recommend one or more companies, based on the interest they have expressed in you as a customer.
These sites promise savings, but they don’t guarantee it, according to Pickles. And convenient as they are, none of the shopping sites have relationships with every insurer on the market. That means you can’t be assured of the largest possible savings by using them.
If you have additional time and patience, seek quotes directly from carriers flagged for low premiums on review sites such as Money and ValuePenguin, or that have yielded savings for friends or family members. Then compare those to the best results from comparison sites and online brokers.
Consider buying car insurance in a bundle
Increased digitization in insurance has made it easier for companies to pitch you multiple policy types, because online questions often include whether you already have homeowners or renters insurance with the company. While facilitating the insurance equivalent of “would you like fries with that?” might be annoying to some people, it can also allow increased opportunities to save on car insurance.
Insurers may be willing to cut you a break on car premiums if they can make some profit on another policy. That can be advantageous even if the other policy is on the pricey side. You might end up paying marginally more on, say, a homeowners policy, but the auto insurance is still better than you can get elsewhere — and by enough that you come out ahead overall.
Be willing to try a driving monitor
The pandemic, and the reduced driving it has created, is spurring new interest in so-called telematics — insurance based on monitoring how far you drive, and sometimes how well you do, as well. Most of the major insurance companies have added telematics programs as an alternative to traditional policies, which are priced on only an estimate of the miles you’ll drive.
You could save on your policy in 2021 simply by trying out those technologies. The trials offer a one-time discount on your premium, or sometimes a cash payment, if you agree to take a spin with telematics. You install a smartphone app or monitor that records mileage and sometimes the quality of your driving — including your speed, and braking and cornering behavior. If you complete the trial, you typically save between 5% to 15% on your next insurance renewal, depending on the company.
Those savings are only guaranteed on a one-time basis, however. Companies dangle the possibility of even-greater savings after they’ve analyzed your data from the trial. But, with programs that measure how well your drive, the opposite can also be the case: If your driving is deemed bad enough, your premium could actually rise after the trial. If you’re a frequent speeder or tire squealer, a telematics policy based on driving quality won’t be a good bet for you.
For good drivers, though, the technology is worth a try, especially since you needn’t even switch from your current carrier to try out its telematics option. (GM and Ford also have programs that allow you to share data from your new vehicles with multiple usage-based insurance programs.)
Programs that bill on a pay-per-mile basis — from both major carriers and pay-per-mile specialists like Root and Metromile — are worth trying for those who drive only minimally, and so may be overpaying with a traditional policy. A number of major insurance companies also have pay-per-mile options of their own, in addition to the programs that also factor in how well you drive.
Struggling to pay your premiums? Ask for rate relief
The formal programs insurers launched in the spring, allowing premiums to be deferred due to the impact of COVID-19, have now ended. The same applies to most of the state-ordered moratoriums on suspending or canceling policies due to non-payment that were also launched in 2020. (GEICO lists only one such continuing program on its website; a moratorium on policy suspensions in the District of Columbia that runs until April 17.)
But some companies are still pledging to at least hear out customers who are financially hurting from the pandemic. None promise a cut in costs for the same coverage, but they do offer other assistance. Erie Insurance, for example, says that “your agent and Erie may be able to assist by updating coverage options, changing pay plans or deferring payments.” Progressive says If you’re experiencing financial hardship due to COVID-19, please call us, and State Farm invites customers “currently facing financial burdens [to] call [their] State Farm agent.”
Bottom line: It’s at least worth a try to reach out to your insurance company for help with paying for your car insurance — which is likely to be one of the priciest insurance policies you own.