5 ways to help lower auto insurance rates

The price you pay for auto insurance can vary by hundreds of dollars, depending on what type of car you have, where you live and how much coverage you need. It's great to save money, but it's also important to make sure you have the right amount of coverage.

Consider these responsible money-saving tips:

Compare vehicle insurance costs.

Before you buy your next car—whether new or used—compare the insurance rates of different vehicles. Your premium is based, in part, on the make and model, the cost to repair it, the overall safety record and the likelihood of theft. Insurers generally offer discounts for features such as air bags or daytime running lights that reduce risk.

Raise your deductible.

A deductible is the amount of money you pay for repairs before your insurance policy kicks in. By requesting a higher deductible, you can lower your monthly premium substantially. Even increasing your deductible from $200 to $500 could reduce your collision and comprehensive coverage cost by 15 to 30%.

Reduce physical damage coverage on older cars.

It may not make sense to keep collision coverage on low-value cars because the insurance costs could exceed anything you get back on a claim. Physical damage reductions offer the greatest savings with limited risk. You also can ask for an estimate of your car's trade-in value the next time you're at the dealership

Research other discounts.

Along with many other insurers, offers savings if you have more than one policy or a long-running loyalty to the insurer. You may also be able to find additional discounts for accident-free drivers and some defensive-driving courses.

Maintain a good payment history.

While good driving habits are the best way to keep your insurance costs low, in some states, your insurance credit score could also be a factor. Repair a damaged credit rating by consistently paying bills and using credit responsibly. Examine your credit report for any mistakes and fight to fix them.