Auto insurance is a necessity, but it’s also costly – in order to drive the car you own, you have to pay hundreds or thousands of dollars every year, just in case an accident happens. And the pricey cost of auto insurance can be a burden for many drivers.

However, there are ways to save. If you want to cut costs on your auto insurance premiums, here are a few money-saving tips you need to know.

Bundle Insurance Policies

In addition to paying for an auto insurance policy, you’re probably paying other expensive insurance premiums. From homeowner’s insurance and renter’s insurance to natural disaster insurance to life insurance, you need to pay to protect many things. So why not save some money by buying your insurance policies from the same provider?

Buying your insurance policies from the same company can save you money. And that’s because many insurance providers will offer you a discount for keeping your policies under one roof, ensuring your business for years to come.

According to Lifehacker, you can save an average of 15.97 percent by bundling your auto insurance with your homeowner’s insurance. Depending on where you live, you could save even more – residents of some states, like Illinois, Georgia, and Kansas, can score savings of more than 21 percent.

It pays to combine your insurance policies, so save yourself some cash by contacting your insurance company and seeing which types of insurance you can bundle together.

Opt for a Family Plan

If you want to save money on your auto insurance premium, consider adding another driver in your home or in your family onto your policy. Keeping multiple members of the same family or household on a single policy gives your insurance provider more business, and in turn they’ll often reduce all of the drivers’ rates, giving you a decent discount.

So, instead of having separate auto insurance policies for each member of your family, you can simply add drivers to one policy. Everyone will still be fully insured, but it could save you money year after year.

As ValuePenguin explains, auto insurance rates decrease pretty equally across the board when you add another driver to your policy. For example, adding an adult driver to an 18-year-old driver’s policy results in approximately $500 in savings.

And here’s another way to save money: you can also remove drivers from your policy if they’re too expensive to insure. Drivers with higher risks, like teen drivers or drivers who’ve recently been in accidents, are often charged much higher premiums for their auto insurance. If you have any high-risk drivers on your policy, you can remove them to score savings.

Pay Your Premium Annually, Not Monthly

Like most people, you probably pay for your auto insurance every month. Although your insurance company likely gave you a bill for the entire year (or a six-month period, if you have a biannual policy), many people prefer to pay their premium monthly. After all, monthly payments make your auto insurance more affordable by breaking one large bill into much smaller amounts.

However, paying monthly is actually a big mistake. By paying your premium monthly, you’re actually paying more money every year.

When you opt to pay your auto insurance in monthly installments, the amount seems more affordable – $100 a month is much easier to pay than $600 or $1,200, especially when you’re on a budget. But what you likely don’t realize is that your auto insurance is adding interest to every bill. Because you’re paying your bill over time, an annual percentage rate (APR) is being added with each payment.

As Bankrate points out, this amount can add up fast: if your bill for an annual premium is $1,000 and you break it into two payments, you’ll pay $520, or $40 more than you actually owe. And Bankrate notes that interest rates can be as high as 16 percent or more, which will quickly add upwards of $40 to what you end up paying.

To avoid these additional fees and charges, you’ll want to pay your policy’s premium in full. Make sure you pay the entire amount when it’s sent to you instead of stretching payments out over time in order to save money and keep interest out of the mix.

Seniors Can Take Advantage of Discounts

Seniors who want to save money on auto insurance should inquire about senior discounts.

One of the most popular programs comes from The Hartford, which is available to anyone over the age of 50 who belongs to AARP. Although the exact discount is not advertised publicly, The Hartford offers no-cost and no-obligation quotes to anybody who contacts them about the program.

Discounts are also available from GEICO to drivers over 50 for things such as taking a defensive driver, being an active/retired member of the military, or going five years with a clean driving record.

Make Sure to Comparison Shop

There’s one final step that’ll save you money on your auto insurance policy every year: comparison shopping. While you might be perfectly happy with your auto insurance company, failing to comparison shop and consider other companies’ rates could wind up costing you a lot of money in the long run.

Auto insurance rates are always increasing, but that doesn’t mean all companies offer the same prices. And you’re doing yourself a disservice if you don’t look into what other insurance providers are offering their customers.

Before your policy is set to renew, make sure to look at other insurance options and rates. Search online for different insurance companies, and see if they’re offering special deals, discounts, or offers for new customers. Check rates with these other providers, and see if you can get a better price by switching your insurance to another company. You might be able to save on your premium, or you might even discover that you’ve been overpaying for some time.

Comparison shopping also lets you take the pricing you find online back to your current insurance provider. You can let them know that you’ve found better pricing on the same – or similar – policies, and see if they’ll lower their prices to keep you as a customer.

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This article was worked on by a variety of people from the Autoversed team, including freelancers, editors, and/or other full-time employees.