August 24, 2020

The Best Ways to Reduce Car Insurance Costs

Question: Can I cancel or reduce my car insurance?

Short answer: No, but you can likely reduce your costs. Read below about some of the best ways to reduce car insurance costs.

The Best Ways to Reduce Car Insurance Costs

Are you paying for insurance you do not need? Driving rates plummeted at the start of the pandemic and will take some time to recover. The following is some advice for any situation that leads to a dramatic reduction in your driving. Every insurance company handles reduced driving differently, and your policy’s particular details will also be at issue. However, some overall axioms apply. In the end you need to call your insurer to learn what you can do to reduce your costs. Here are some things to look for and ask about.

What does my insurance really cover?

Before you think about reducing or canceling your coverage you need to fully understand what you are actually impacting. Did you know your insurance might cover you as a pedestrian, or cyclist? Your insurance covers certain activities and items that you might not have thought about. Brush up on your policy before making any decision. One of the best ways to reduce car insurance cost is realizing what insurance coverage you do actually have.

Can I cancel my insurance outright?

Even if you will not be driving your car at all it is not recommended to cancel your insurance. If you are still making payments on your car, your loan most likely legally binds you to continue insurance. If you own your vehicle outright and cancel your insurance this could be considered a “coverage lapse” which increases insurance rates further down the road. Your insurer may allow for “suspending” your coverage, but this is insurer specific.

Can I lower my premiums without reducing my coverage?

Some insurers base a portion of your premiums based off your mileage. In this case you can likely get your premiums reduced due to the extreme reduction in mileage.

Can I Reduce my coverage?

Once again if you have a car loan, you likely have minimum coverage levels which you must meet. However, if you own your vehicle outright or if it is allowed by your auto-loan reducing coverage can be a good alternative to outright cancellation. You will have to balance your risk, but here are the state minimums for your consideration.

Oregon Minimums Official Website

Washington Minimums Official Website

Specifics are based on your insurer and state law (our firm practices in Washington and Oregon), but you could explore options such as removing drivers from the policy or removing liability insurance while keeping comprehensive coverage.

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