Martin G. of Washington State is really Web savvy, so when he got his first car, he shopped around for insurance on the Internet. If more people would do that they would SAVE BIG. Martin is 18 years old, drives an SUV, and, like many young guys, he’s had one minor fender bender that resulted in about $500 worth of damage. His grades are solid, but not enough to qualify him for a good student discount. Martin got two quotes and made sure both were for the exact same coverage. So did this sweet, but flawed, young driver save some money? You bet! Take a look:

Benefit of Shopping Around for Car Insurance

Insurance company 1	$ 7,308/year
Insurance company 2	5,830/year
BIG SAVINGS =	$ 1,478/year

Isn’t it amazing that there could be a $1,478 difference in the rates charged by two different insurance companies for the same coverage? You may be wondering if insurance company number 2 is “Bob’s Taxidermy and Car Insurance,” an unknown company in a trailer somewhere that’s unlikely to pay if Martin makes a claim. Not so. Both quotes came from big, national insurance companies that advertise like crazy. If you want to shop online for car insurance, here are some helpful websites: www.Geico.com, www.Esurance. com, www.NetQuote.com, and www.Progressive.com.

Hire an Independent Agent

If you don’t trust the quotes you’re seeing online, another good way to shop around is to check with an independent insurance agent who sells policies for several different companies. With one phone call or e-mail, an independent agent can give you quotes from a bunch of different carriers. To find an independent insurance agent, go to www.TrustedChoice.com, the website of the Independent Insurance Agents and Brokers of America. Just keep in mind that these agents don’t represent companies like Allstate and State Farm that have their own, in- house agents. If you want quotes from those companies, you will have to approach each one directly. There’s no harm in getting multiple quotes, because they are free of charge.

More Ways to Save

There are lots of other ways to save on car insurance, according to the Insurance Information Institute. Get your car and homeowner’s insurance through the same company and save 10 percent. Buy car insurance through a group plan, perhaps offered by your employer, and save 5 percent. Tell your insurance company some other company has offered you a better deal and save 15 percent.

Join the Club

Here’s a more creative source when you’re shopping around for car insurance. If you belong to a wholesale warehouse like Costco, BJ’s, or Sam’s Club, you may be able to get auto insurance there. They partner with some major insurers to offer group discounts to their members. Sounds weird to pick up bulk toilet paper, cheap electronics, and auto insurance in one place, but it’s true. Some warehouse club members have cut their car insurance costs in half by signing up.

Gregory P. of North Carolina is one of them. He says the warehouse club car insurance policy was actually more generous than his old policy yet cost half as much. Gregory switched both his family’s cars to the new policy and bragged about his savings online. Here’s how he did:

Warehouse Club Car Policies

Individual car insurance policy	$ 2,832
Warehouse club car policy	1,392
BIG SAVINGS =	$1,440

Change Your Coverage

Changing companies is one way to slash your car insurance premiums; changing your coverage is another. You can raise certain parts of the policy, lower others, and even cancel some to SAVE BIG.

Raise Your Deductible

It was my dad who taught me that insurance is supposed to be just that: insurance—not a maintenance plan. In other words, you buy insurance to protect yourself in extreme situations. You pay for the little scratches and dings yourself. With this in mind, I’ve always been a big believer in high deductibles. The deductible is the amount you must pay yourself before insurance kicks in. When you raise your deductible, the insurance company faces less risk that it will have to pay for petty claims, so it gives you a generous discount.

Many people sign up for deductibles of just $100 or $250. I suggest you set your deductible way higher than that. Just don’t sign up for a deductible so high that it will ruin you financially if you have to pay it.

You will SAVE BIG if you raise your deductible. For instance, you can save up to 30 percent by signing up for a $500 deductible instead of a $200 one, according to the Insurance Information Institute. Hike the deductible up to $1,000—which I think is more like it—and watch the premium drop by 40 percent or more.

Here’s an example, using the average annual premium that I mentioned earlier—$3,744 for a two-car family. Since the typical savings when you switch from a $200 deductible to a $1,000 deductible is 40 percent, here’s how you SAVE BIG:

Raise the Deductible, Lower the Premium

Average annual premium for a two-car family	$ 3,744
Premium after raising deductible to $ 1,000	2,246
BIG SAVINGS =	$1,498

Yes, it’s true that if you get in a wreck, you will have to shell out $1,000 of your own money, possibly at a painful time. But the discount is so substantial that you can save up the $1,000 needed for the deductible in less than a year.

Here’s another way of looking at it: Take the sure savings and risk the possible costs. After all, there is a good chance you will never be in a car accident. And if you are in one, it may be the other driver’s fault, in which case that person will be the one worrying about their deductible—and the repairs won’t cost you a cent.

Not only will raising your deductible save you money, it could save you from having your insurance policy canceled. These days insurance companies are tight with their funds. Have you ever heard of nonrenewal? That’s their silly euphemism for canceling you as a customer, but the result is no joke. Insurance companies have a central database where they share information with each other. If you make a bunch of frivolous claims and your company cancels you, other insurance companies may well review your record and choose not to insure you, either. High deductibles discourage frivolous claims and keep your coverage safe.

Involuntary Car Insurance

If you don’ t buy car insurance, your finance company may buy it for you. That’s right. Some lenders check to see if you have proper insurance, and if you don’ t, they will buy an overpriced policy for you—or really for them—to protect their investment. When you think you’re finished making your car payments, surprise! You get socked with an insurance bill for thousands.

Cancel Your Collision and Comprehensive Coverage

Since I’m advising you to keep your car as long as you can stand it, there’s one more way to save on car insurance. At some stage your car will depreciate to the point that it is not worth repairing. That’s when it may be worth your while to drop the collision and comprehensive coverage on your old car. Collision is the insurance that pays to repair the vehicle after a wreck. Comprehensive car insurance covers repairs if your car is damaged in something other than a car accident—like if a tree falls on it.

Experts suggest that you should consider nixing that coverage when your annual collision and comprehensive premium equals more than 10 percent of your car’s value. If you cancel these options, instead of fixing your vehicle after it’s mangled, you will just kiss it off and get a new (used) one. Canceling collision and comprehensive can reduce your premium by 30 to 40 percent, according to www.Autoguide.com. Don’t worry—you will still have the truly important mandatory car coverage like liability insurance, the kind that covers you if you hurt somebody else.

Jacqueline M. of Hawaii drives a fast, loud, older car that she loves. Her boyfriend has a somewhat aged vehicle, too. Jacqueline has moved around a lot for her career, so the belongings she brings with her are what make each city feel like home. It was hard for Jacqueline to admit that it wouldn’t be worth repairing her old rocket. But when she finally got around to canceling the collision and comprehensive coverage on her vehicle and her beau’s, she quickly changed her mind. Let’s see how much she saved per year by dropping her collision and comprehensive coverage: