Americans seem to be spending a little more on everything these days. And on auto insurance, they are spending a lot more.

The average car insurance premium jumped by more than 20% over the past year, according to Consumer Reports. The national average cost of full-coverage insurance hit $2,543 in 2024, a one-year increase of 26%, according to Bankrate.

Those are big bumps, considering the overall annual inflation rate for March reached 2.7%.

Fortunately, there are several easy ways – and some harder ones – to reduce your premium.

Here are nine tips from the experts.

Lower your auto insurance costs: Find the best car insurance of 2023

Shop around for the best car insurance value

Finding a new insurance company takes time, but the switch can dramatically lower your annual premium.

Notwithstanding the endless barrage of TV car insurance ads, some insurers do tend to cut better deals. An analysis by Bankrate, the personal finance site, found a swing of more than $1,000 between the cheapest and most expensive annual full-coverage premium among the largest companies. Here are the averages:

USAA: $1,695

Geico: $1,741

Progressive: $1,988

State Farm: $2,364

Allstate: $2,971

Insurers use varying formulas to calculate premiums, typically factoring in your age, location, driving record and credit score, among other items.

“That’s why the single most important tip I give people is to compare car insurance quotes from multiple providers to see who offers you the best deal,” said David Straughan, automotive expert at the financial research site MarketWatch Guides. “The same provider that gave your neighbor the best rates may not be the one with the lowest prices for you.”

MarketWatch, Bankrate and others offer online tools for comparing quotes. 

Increase your deductible

This is a quick, easy and valuable fix, though it sounds scary: Increase your deductible, the amount of cash you pay before your insurance kicks in.

Many policies come with a $500 deductible. Doubling it to $1,000 can reduce an annual premium by 20% to 25%, according to Consumer Reports, the consumer nonprofit.

Raising a deductible makes sense, experts say, because most motorists rarely file an auto insurance claim.

“If you have a low deductible, it’s because you’re nervous you’re going to get in a crash, and it’s your fault, and you’re going to be stuck with a bill you have to pay,” said Benjamin Preston, Consumer Reports auto reporter.

By raising your deductible, he said, “really you’re just betting on yourself as a safe driver.”

Drop collision and comprehensive insurance coverage

Dump your collision coverage? This sounds like another risky move. And it is, if you have a really valuable car.

Collision insurance covers damage to your car if you’re in a crash. Comprehensive covers non-collision damage.

Drivers should think about dropping both, experts say, for an older car of declining value.

One insurance industry rule of thumb says you should consider ending collision and comprehensive coverage if your annual premium is more than 10% of the value of the vehicle.

The reason: You could be paying more for the coverage than you’ll ever get from the insurance company if your car is damaged, “because the car’s not worth enough,” Preston said.

Take a defensive driving course

Some insurers will give you a discount if you take an approved safe-driving course.

In New York, for example, motorists can reap a 10% discount on auto insurance if they take a state-approved course, which costs about $25 and takes about five hours to complete, according to Consumer Reports. You can repeat the course every three years.

Look for car insurance discounts

Auto insurers typically offer a range of potential discounts. You may be able to lower your premium by:

-   Insuring multiple vehicles

-   Bundling multiple policies from the same insurer

-   Being a good student

-   Serving in the military

-   Driving fewer miles in a year

-   Owning a car with enhanced safety features

-   Being a safe driver

-   Being loyal to your insurance company

-   Paying your entire premium upfront

“Always ask your agent about the discounts available to you before signing up for a policy,” Straughan said.

Work on your credit score

Insurers often consider credit when setting insurance premiums. Drivers with weaker credit tend to pay higher premiums, although some states forbid insurers from using credit as a factor.

“The national average cost of full coverage car insurance for a driver with poor credit is $4,063 per year, whereas drivers with average credit only pay an average of $2,520 per year, and drivers with good credit pay an average of $2,314,” Shannon Martin, a Bankrate analyst and licensed insurance agent.

Good credit doesn’t happen overnight, but a rising score can yield lower premiums over time.

Be a better driver

Maintaining a clean driving record “is really the best way to keep the cost of your car insurance down,” Martin said.

That means avoiding mishaps that can send your premiums into the stratosphere. The costly ones include speeding tickets, accidents that are your fault, and drunken driving convictions.

“Drivers with a single DUI conviction pay an average of $4,408 per year for full coverage car insurance,” Martin said. “This is $2,094 more than the national average for drivers with a clean driving record.”

Buy a cheaper car

You probably noticed the hit to your pocketbook the last time you brought home a new car: The more valuable the car, the more you pay to insure it.

Insurance premiums tend to be lower on vehicles that are worth less because they cost less to replace.

On a high-value car, “the parts are going to cost more, the labor is going to cost more,” Preston said. “So, they factor that into the premium.”

If you’re shopping for a car, you should budget for both the purchase price and the insurance.

“Most dealerships have complete vehicle identification numbers online, and your agent can use them to provide you with accurate quotes,” Martin said. “Once you know which cars you can afford insurance-wise, you won’t be surprised at the insurance cost at the time of purchase.”

More:Car prices are cooling, but should you buy new or used? Here are pros and cons.

Review before you renew

Take a close look at your insurance policy every year, experts say. Make sure you aren’t paying for coverage you don’t need, or missing out on potential savings.

Life changes, such as marriage, moves and job shifts, can affect how much insurance you need, and how much you pay.

Changing careers can affect your premium, in ways you’d never guess.

“Insurance companies might view teachers as less of a risk, since they drive less in summer, and nurses usually pay more for insurance since they work long shifts and are more likely to have an accident,” Martin said.

“Annual mileage and daily commuting also impact your rates, so if you have started working from home or now only drive into the office three days a week instead of five, let your agent know.”