How to Reduce Your Car Insurance Premium While Working From Home

Many people are working from home and driving less as a result of the coronavirus pandemic. By April 2020, 31 percent of employees working in an office in the United States would be working from home. Many of them are still doing so today.

Others have changed jobs, changed careers, or even left the workforce. Many insurers recognized these changes early on and responded by lowering premiums and issuing refunds to policyholders. However, as the months pass, you may find yourself looking for additional ways to cut costs. Lowering your car insurance rates can be beneficial.

You can immediately lower your rates by making a few changes while staying at home and driving less.

Ways to Reduce Car Insurance Premiums

Many insurance companies offered refunds and discounts following lockdowns and stay-at-home orders. These refunds may not be the only discounts available to you. Aside from the credits that insurers have already paid out, there are other ways to save money on car insurance.

Do you know what to say to your insurer in order to get a better deal on your car insurance while working from home? Begin by inquiring about your policy's coverages and discounts: “Hello, I'm calling to inquire about my car insurance premium. I've been researching insurance prices and looking for ways to save money. Can we go over my policy's coverages and discounts to ensure I'm getting the best deal?”

If you have stopped driving your car, changed your work situation, or reduced your time on the road, try saying something like, "I usually drive X number of miles to work, but I am now working from home and have been for several months." Can you reduce my annual mileage or change my policy to allow only for pleasure use now that I no longer commute?”

Other statements and questions to ask your insurer include:

• “Do I qualify for a storage credit because my car has been in storage?”
• “Can we go over my policy's optional coverages?”
• “How about raising my deductible?”

Lower Your Annual Average Mileage

The annual mileage on your car affects the cost of your insurance. Looking at your car's odometer will give you an idea of your annual mileage. Check to see how many miles you've driven since you bought the car.

We obtained quotes from several major insurers to determine how changing the weekly mileage would affect the premium. For each quote, we used the same profile: a 35-year-old female driver from the Minneapolis area with no accidents, tickets, or violations, and a clean driving record with at least five years of prior insurance. The vehicle mentioned was a 2018 Ford Explorer with a six-month policy. Some insurers provided lower premium quotes, while others did not.

Ask Car Insurance Company for Discounts

If you've been with your car insurance company for a while, it's worth calling to see if you qualify for any new discounts. Among the discounts to inquire about are:

• Multiple-car discounts: If you have two cars, consider insuring them on the same policy, or with the same company.
• Multi-policy discounts: Bundling your home and car insurance with the same company may give you a discount. Note that some insurers offer more of a discount than others.
• Payment option discounts: Some insurers offer discounts based on how you pay your premium. Ask about full pay discounts, responsible payer discounts, or discounts for an automated payment plan.
• New policy or loyalty discounts
• Early signing discounts: Not leaving your insurance to the last minute can save you money. Some insurers offer discounts when you shop ahead.
• Group affiliation discounts: Many insurers offer discounts to members of groups. Military and government employees, for instance, get discounts with GEICO. People over 50 can get insurance through AARP’s car insurance program from The Hartford. Many insurers will ask you about member affiliations when you first sign up, to offer discounts.
• Internet discounts or “buy your policy online” discounts
• Paperless discounts: Going paperless gets a discount with some insurers.
• Car safety feature discounts
• Anti-theft device discounts
• Student driver, good grade, or other discounts for students away at school
• Defensive driving course discounts
• Good credit rating discounts: If your credit has improved since you first got your insurance, see whether you can get a better discount. If your credit is not as strong, consider shopping with insurers that do not use credit scoring as heavily in their ratings.

Enroll In Usage-Based Insurance

When you enroll in a usage-based insurance program, some insurers will offer you lower rates. These programs frequently employ an app or device to track various aspects of your driving habits, such as how much you drive. This data is used to adjust your rates based on your actual driving habits.

State Farm, for example, offers a Drive Safe & Save Program with discounts of up to 30% off. Travelers offers the IntelliDrive program, which provides a discount of up to 20%. 

Reduce or Cut Optional Coverage

There are numerous optional coverages available when purchasing car insurance. We obtained quotes from several insurers and discovered that there were frequently multiple options for "full coverage." Furthermore, there were frequently a plethora of liability limit options available in excess of the bare minimum required by law. It might be a good idea to look into optional coverages such as the following:

• Collision coverage and comprehensive coverage: Optional coverage that covers damage to your car under a variety of circumstances. For example, if your vehicle is damaged in an accident, vandalized, or stolen.
• Coverage upgrades: Insurance companies provide options to upgrade the basics to include perks such as lower deductibles or even cash back. Take a look at how much you're paying for these upgrades (if you have them).
• Roadside assistance, transportation expenses, or rental reimbursement coverage: If you park your car most of the time and stay close to home, you may want to compare the cost of this coverage to your current rate.

Increase the Deductible

Choosing a higher deductible is one way to keep all of your coverage while still saving money. One insurer we looked at, for example, charged up to $100 more for a six-month policy term with a $0 deductible versus a $500 deductible on comprehensive coverage alone. In general, raising your deductible from $200 to $500 can save you between 15% and 30% on collision and comprehensive coverage. Raising your deductible to $1,000 could save you 40% or more.

When looking for insurance, make sure to get written quotes. Before making a decision, compare the coverage line by line with your current policy. You can even try to persuade your current insurer to match the offer. Insurers are frequently willing to negotiate in order to keep your business.

How to Make Car Insurance Policy Changes

You must contact your insurance company to make changes to your policy. Most insurers provide several ways to contact them. Chatbots, online access, community forums, apps, writing by email or mail, and of course, phone are all examples. Insurers will have different procedures or requirements depending on the type of change you're requesting.

Online

Through their websites, most insurance companies provide some form of online account management. Frequently, you can make minor changes or initiate requests online. We checked with several insurers and discovered that some only allow basic changes (such as a change of address) online and require you to call in for other requests. Other insurers have a broader range of options.

Telephone

When you call to make changes to your policy, you have a better chance of getting answers to questions about your discounts and coverages. If you call to request a policy change, the agent will usually be able to assist you right away with basic changes. Still, some changes may necessitate additional information, such as a new car's VIN number or a driver's license number for a new driver.

Other

Insurers are increasingly using mobile apps to provide consumers with self-service options and instant access to policy information. Many insurers provide policy-servicing options, such as the ability to update your policy via an app. In other cases, the apps are used for emergency services, insurance proof, and claims management.