Insurance premiums are one of the toughest spending categories to deal with, since we feel like we have little control over rising premiums. However, there are a couple of ways to deal with them effectively.

The most effective way is to get quotes from competitors every 2-3 years. In August 2024, we got our renewal notice from Farmers Insurance on our auto policy and it was significantly higher than what we had previously been paying. We asked the representative why it had risen so much and the response we got was “all insurance premiums in the state of Washington are rising.” That was not a very satisfying answer, so we decided to get a few quotes from other insurers.

Most of those quotes came back in a similar range, but one of them came back almost $600 cheaper per year — Amica Insurance. The coverage was the exact same as our Farmers policy, but for whatever reason, Amica was willing to offer lower rates. Our home policy was priced very similar to Farmers, but it was our auto policy that dropped significantly (from $2,525 to $1,770 per year). We also moved our home policy to Amica to make sure we kept the multi-policy discount rather than splitting across two insurers.

Before (Farmers, Auto): $2,525 per year
After (Amica, Auto): $1,770 per year
Annual savings: $755 — Added to the Haggle Fund

A few things worth knowing before you shop around:

  • Rates are state-dependent. Which insurers are competitive varies a lot by state, so a result like ours in Washington won’t necessarily transfer directly to where you live.
  • Credit-based pricing plays a role. In most states, insurers factor in credit-based insurance scores, so your results will depend on more than just getting quotes.
  • Driving Record. Your driving record plays a major role in the price you are offered on Auto Insurance. If you’ve been in an accident or have speeding tickets on your record, your premiums will be impacted.

Beyond shopping around: tuning your coverage

Another, slightly less effective way to control premiums is to review your coverages on an annual basis (around renewal time is best). It’s normal for premiums to rise every year, and that’s also been the case with Amica over the last couple of years — but we’re still way below where we were with Farmers.

We spend time at each renewal playing around with deductibles and adding or removing coverages to see what impact they have on our overall premiums. Do you really need a $500-or-less deductible on your collision or comprehensive coverage? It’s a personal choice, but we’ve found that increasing that deductible to $2,000 or even higher provides good value and has helped us slow the rising premiums so far. As your car gets closer to end of life, you could also consider removing collision coverage completely, since its value declines as your car becomes less valuable over time.

With time and effort, it’s possible to save real money on insurance premiums. Don’t let insurers keep raising yours without checking out the competition to see whether those premiums are still fair.

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