Can You Negotiate Car Insurance?

Car insurance can be expensive. So when you need to insure your vehicle, it’s a good idea to try to save wherever you can. Unfortunately, negotiating the cost of your coverage with your insurance company is typically not possible, but you may be able to find other ways to save.

From policy discounts to deciding when you pay your premium and even claims reimbursements, here’s what you need to know about finding some flexibility with your car insurance rates.

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Why you can’t negotiate car insurance rates

Car insurance companies don’t typically allow you to negotiate your car insurance premium. Instead, insurers base rates on a wide variety of factors that contribute to the likelihood of you filing a claim. Drivers seen as low-risk generally pay less for car insurance than high-risk drivers.

To determine your rate, car insurance companies consider the following factors:^[1]

• Driving record

• Age

• Gender

• Marital status

• Vehicle make and model

• Age of vehicle

• Geographical location

• Credit history

• Previous coverage history

• Types of insurance deductibles

Keep in mind that although you can’t negotiate your insurance rates, your state representatives and regulators may have a say in what insurance companies do — especially for car insurance rates increases and risk-assessment tools.

What you can negotiate

Despite the fact that car insurance prices aren’t up for negotiation, you may be able to find flexibility in other areas, including:

• Payment schedule: Depending on your insurer, you may be able to decide when you pay your premium. For example, you could set up monthly payments, a series of installments, or pay your premium up front. You may also have the option to lower your car insurance costs if you pay your insurance premium in full.

• Claim amount: If you’re in an accident and have to file a car insurance claim, the claim settlement your insurance company offers may be negotiable. If you’re unhappy with the offer, you can decline it or seek legal representation, especially if your car insurance company denies your claim.

How to save on car insurance without negotiating

Although you can’t negotiate car insurance rates, you can take steps to lower your car insurance costs.^[3] The tips below could be a great place to get started.

• 

  Comparison shop

  One of the best ways to save money on the cost of car insurance is to shop around and compare multiple car insurance quotes. Average car insurance premiums vary widely, sometimes by hundreds of dollars or more, depending on the insurer you choose, your age, your gender, and other factors. It’s wise to compare your options to find an insurance company and plan that works best for your needs and budget.

• 

  Seek discounts

  You may be able to cut your car insurance costs by looking for insurers that offer discounts. Car insurance discounts typically cut between 3% and 60% off the cost of your auto insurance premiums, depending on your eligibility and other factors.

• 

  Drive safely

  A clean driving record might help you lower premium costs. Try to avoid major violations and practice safe day-to-day driving habits. And if you’re able to attend a safe driving course, you might also be eligible for an additional defensive driving discount.

• 

  Take care of your credit

  A good credit history has the potential to save you money in numerous ways, including lower premiums on car insurance in many states. If you live in a state where car insurance companies are permitted to use credit-based insurance scores, improving bad credit might help you secure a lower price on your car insurance premium. In the meantime, you might consider getting quotes from insurance companies that don’t consider credit.

• 

  Choose a safe vehicle

  Car insurance rates can vary tremendously according to the type of car you drive. So, if you want to save money on car insurance, choosing a safe vehicle make and model can go a long way toward helping you achieve that goal.

  In general, cars with more robust safety features are more affordable to insure. Yet luxury vehicles and larger vehicles, like trucks and SUVs, may feature higher premiums compared to sedans.

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Negotiating a claim settlement

A car accident can be a stressful experience — one every driver hopes to avoid. Yet if you’re ever in an auto accident, it’s important to understand the claims process and how to negotiate a claims settlement with your car insurance company.

An auto insurance claim usually begins when you notify your car insurer that an incident occurred and damaged your vehicle. From there, an insurance adjuster will gather information and investigate. If an adjuster approves your claim, they’ll assess the damage and offer you a settlement amount.

It’s important to understand that you don’t have to accept the first offer an insurance adjuster makes. In fact, it may be wise to do your own research to make sure the offered amount is fair and adequate to pay for any necessary repairs to your vehicle and other types of expenses, like medical bills, when applicable. If you believe a settlement offer is lacking, you have the right to question it and ask for additional funds.^[4]

Research your car’s value

Before you begin any type of settlement negotiations with an insurance adjuster, it’s helpful to know the fair market value of your car. You can typically find out what your car is worth by:

• Looking up your vehicle on third-party websites, such as Edmunds or Kelley Blue Book.

• Talking to multiple reputable mechanics.

• Researching the prices of comparable vehicles for sale in your area.

If an adjuster’s estimate of your vehicle’s fair market value is less than the estimates you receive, you may be able to use the information you gather to request a higher settlement amount.

Keep documentation

Throughout the claims process — and especially if you plan to negotiate with an adjuster — it’s important to remain organized and keep detailed records of documents that are relevant to your claim. Accident reports, evaluations of vehicle damage, notes from witnesses, repair costs, and medical expenses are a few examples of the types of paperwork you should retain. There’s a good chance you might need this information at some point in the future.

When to get legal help

In many cases, you don’t need outside legal assistance to settle a car insurance claim, even if a little back and forth negotiation may be in order to make sure you get a fair deal. But if your situation is complex or you don’t feel comfortable with an insurance company’s settlement offer, it might be a good idea to talk to a trustworthy attorney for guidance.

Situations where an insurance company is acting in bad faith or refusing to pay out enough money to cover your damages might require professional advice.^[4]

Negotiating car insurance FAQs