{"id":352191,"date":"2025-11-07T12:09:39","date_gmt":"2025-11-07T17:09:39","guid":{"rendered":"https:\/\/www.reviews.com\/?p=352191"},"modified":"2025-11-07T12:09:39","modified_gmt":"2025-11-07T17:09:39","slug":"5-biggest-mistakes-people-make-on-car-insurance","status":"publish","type":"post","link":"https:\/\/www.reviews.com\/insurance\/car\/5-biggest-mistakes-people-make-on-car-insurance\/","title":{"rendered":"The 5 Biggest Mistakes People Make on Car Insurance"},"content":{"rendered":"\n

Even the best car insurance<\/a> premiums are still trending higher in 2025, though the pace has eased versus last year. The Bureau of Labor Statistics\u2019 motor vehicle insurance index continues to post double\u2011digit year\u2011over\u2011year increases in recent 2025 releases\u2014below the ~20%+ peaks seen in 2024\u2014signaling that premiums remain elevated even as momentum moderates (BLS CPI<\/a>). Behind these increases are claim\u2011cost pressures such as higher repair complexity and calibration needs on modern vehicles, medical and legal cost severity, severe\u2011weather losses, and greater exposure from miles driven (CCC Intelligent Solutions<\/a>; Insurance Information Institute<\/a>).<\/p>\n\n\n\n

Many drivers also overpay due to avoidable shopping and policy mistakes. Consumer shopping and switching remain elevated in 2025\u2014running above historical norms as price sensitivity rises\u2014so a more evidence\u2011based approach can lower costs (TransUnion<\/a>). Below are five common mistakes, updated with 2025 data and concrete ways to save.<\/p>\n\n\n\n

Not shopping around <\/h2>\n\n\n\n

Checking prices with only one or two insurers leaves money on the table. Carriers price differently by state and weigh many factors\u2014location, driving history, annual mileage, vehicle tech, and (in most states) credit\u2011based insurance scores\u2014so quotes for the same driver can vary widely. In 2025, pricing spreads are amplified by usage\u2011based insurance (UBI) and pay\u2011per\u2011mile programs offered by leading providers (e.g., Progressive Snapshot, State Farm Drive Safe & Save, Allstate Drivewise\/Milewise, Nationwide SmartRide\/SmartMiles), which reward safe or low\u2011mileage driving (Progressive Snapshot<\/a>; State Farm Drive Safe & Save<\/a>; Allstate Drivewise<\/a>; Allstate Milewise<\/a>; Nationwide SmartRide<\/a>; Nationwide SmartMiles<\/a>).<\/p>\n\n\n\n

Therefore, it\u2019s important to shop around before you decide on a policy. \u201cGet at least three quotes from different insurance companies and different types of insurance companies: those that sell through their own agents, those that sell through independent agents and those that sell directly to consumers through an app or the Internet,\u201d says Scott Holeman, director of media relations at the Insurance Information Institute. In today\u2019s market, re\u2011shop every 6\u201312 months as state filings change and compare at least one UBI quote and one pay\u2011per\u2011mile quote if you\u2019re a low\u2011mileage driver; pay\u2011per\u2011mile products often pencil out for roughly 7,500\u201310,000 miles\/year or less (programs and thresholds vary by carrier and state) (Insurance Information Institute<\/a>; TransUnion<\/a>; Allstate Milewise<\/a>; Nationwide SmartMiles<\/a>).<\/p>\n\n\n\n

Not updating your policy  <\/h2>\n\n\n\n

Your coverage and vehicle profile can drift out of date. If you\u2019re still carrying collision and comprehensive on an older, low\u2011value car, reassess whether the premium and deductible are justified. Conversely, late\u2011model vehicles with advanced driver\u2011assistance systems (ADAS) may warrant keeping physical damage coverage; while features like automatic emergency braking (AEB) can cut front\u2011to\u2011rear crashes by about 50%, repairs on sensor\u2011equipped bumpers, windshields and grilles often require calibrations that add time and cost, keeping claim severity elevated (IIHS<\/a>; CCC Crash Course 2025<\/a>).<\/p>\n\n\n\n

\u201cIf you drive an older car, you may want to reduce optional insurance like collision and\/or comprehensive coverage,\u201d Holeman says. \u201cCheck the value of your car to see if this is a viable option.\u201d <\/p>\n\n\n\n

Also remove former household drivers you no longer insure, verify your annual mileage and usage type, and review deductibles. Higher deductibles typically lower premiums but raise out\u2011of\u2011pocket costs at claim time. If you enroll in telematics, confirm whether your program is \u201cdiscount\u2011only\u201d or can also raise your price for risky driving\u2014some carriers disclose that in certain states, telematics results may increase premiums at renewal (Allstate Drivewise<\/a>; Travelers IntelliDrive<\/a>).<\/p>\n\n\n\n

Failing to maintain a good driving record <\/h2>\n\n\n\n

Tickets, at\u2011fault crashes, and serious violations (e.g., DUI) can affect your price for 3\u20135 years with many carriers. In 2025, insurers are increasingly augmenting Motor Vehicle Records with telematics insights such as phone distraction, speeding relative to limits, hard braking, and night driving to better capture risk patterns that MVRs miss. Some programs can reduce discounts\u2014or in certain states, raise your premium\u2014if risky patterns persist, while others are discount\u2011only by rule (LexisNexis 2025<\/a>; J.D. Power 2025<\/a>). Model\u2011governance rules are also tightening: Colorado now requires carriers to document and test models (including telematics and third\u2011party scores) to prevent unfair discrimination (Colorado SB21\u2011169<\/a>).<\/p>\n\n\n\n

Maintain a clean record, consider an approved defensive\u2011driving course, and evaluate UBI if you drive consistently and avoid distraction\u2014large carriers advertise substantial potential savings for safe driving, often applied at renewal (examples: up to 30% with State Farm Drive Safe & Save or Travelers IntelliDrive; up to 40% with Nationwide SmartRide or Allstate Drivewise; actual results vary by state and behavior) (State Farm<\/a>; Travelers<\/a>; Nationwide<\/a>; Allstate<\/a>).<\/p>\n\n\n\n

Not asking for discounts <\/h2>\n\n\n\n

Discounts remain one of the most reliable levers to offset elevated premiums in 2025. Ask about: UBI\/telematics and pay\u2011per\u2011mile, multi\u2011policy (bundling home\/renters\/umbrella), multi\u2011vehicle, safe\/claims\u2011free and defensive\u2011driving, good student\/young driver programs, EV\/hybrid and safety\/anti\u2011theft credits, plus paperless, auto\u2011pay, pay\u2011in\u2011full, and early\u2011renewal savings. Availability and amounts vary by state and carrier (Insurance Information Institute<\/a>; TransUnion<\/a>).<\/p>\n\n\n\n

Vehicle choice matters for safety and insurance. ADAS features are increasingly standard and can reduce certain crashes\u2014AEB cuts front\u2011to\u2011rear crashes ~50% and related injuries ~56%; blind\u2011spot monitoring can lower lane\u2011change crashes ~14%; rear automatic braking can slash backing crashes ~78%\u2014but repairs of sensor\u2011equipped parts and required calibrations add cost, which is reflected in claim severity and premiums (IIHS AEB<\/a>; IIHS Blind\u2011spot<\/a>; IIHS Rear crash prevention<\/a>; CCC Crash Course 2025<\/a>). A U.S. rule finalized in 2024 will require AEB with pedestrian detection on all new passenger vehicles by 2029, accelerating adoption (NHTSA<\/a>).<\/p>\n\n\n\n

Billing and policy\u2011management choices can also lower costs: insurers frequently offer savings for paperless, auto\u2011pay, and paying in full. For behavior\u2011based programs, understand the ranges and rules: many large carriers advertise \u201cup to\u201d 30%\u201340% in UBI savings for safe driving, usually realized after a monitoring period, and pay\u2011per\u2011mile products can be attractive for sub\u201110,000\u2011mile drivers; confirm whether risky driving could increase your price in your state (Allstate Drivewise<\/a>; Travelers IntelliDrive<\/a>; Nationwide SmartRide<\/a>; State Farm Drive Safe & Save<\/a>; Allstate Milewise<\/a>; Nationwide SmartMiles<\/a>).<\/p>\n\n\n\n

Having a low credit score <\/h2>\n\n\n\n

In most states, insurers use credit\u2011based insurance scores (CBIS) to help price and underwrite auto policies. Four states prohibit credit in private\u2011passenger auto (California, Hawaii, Massachusetts, and Michigan); Washington currently permits use with consumer protections. Where allowed, the impact can be large\u2014national analyses show drivers with \u201cpoor\u201d credit often pay roughly 50% to 100%+ more than those with \u201cexcellent\u201d credit, though effects vary by state and insurer (Insurance Information Institute<\/a>; Michigan DIFS<\/a>; Washington OIC<\/a>; The Zebra 2024<\/a>).<\/p>\n\n\n\n

To help improve your profile, verify your credit reports with Equifax, TransUnion, and Experian and dispute errors\u2014you can access reports for free at AnnualCreditReport.com<\/a>. If credit information contributes to an adverse pricing decision, insurers must provide an adverse\u2011action notice under the FCRA; many states also require accommodations for extraordinary life circumstances (NAIC<\/a>).<\/p>\n\n\n\n

Other ways to strengthen your standing include on\u2011time payments, lowering revolving balances, avoiding unnecessary new accounts, and giving positive credit changes time to flow into your insurance score. Note that some states restrict credit use entirely for auto, and in permitted states CBIS is typically applied at new business and at renewal within filed rules\u2014ask your agent how and when it affects your rate (Insurance Information Institute<\/a>).<\/p>\n\n\n\n

The bottom line <\/h2>\n\n\n\n

Premiums remain historically high in 2025, with the BLS motor\u2011vehicle\u2011insurance CPI still showing double\u2011digit annual increases even as the pace cools from 2024\u2019s ~20%+ peaks (BLS CPI<\/a>). To find value: get quotes from at least three different distribution types (direct, captive\u2011agent, independent\u2011agent); include one UBI and, if you drive fewer miles, one pay\u2011per\u2011mile option; right\u2011size coverages and deductibles; remove outdated drivers\/vehicles; and stack discounts (bundling, defensive\u2011driving, billing). Keep in mind ADAS can reduce crash frequency but may raise repair severity due to sensor calibrations; behavior\u2011based pricing via telematics is often where safe drivers see the biggest savings. Regulations and availability vary by state\u2014especially for telematics surcharges and credit use\u2014so confirm program rules when you shop (TransUnion<\/a>; Insurance Information Institute<\/a>; CCC Crash Course 2025<\/a>; IIHS<\/a>).<\/p>\n","protected":false},"excerpt":{"rendered":"

Even the best car insurance premiums are still trending higher in 2025, though the pace has eased versus last year. The Bureau of Labor Statistics\u2019 motor vehicle insurance index continues to post double\u2011digit year\u2011over\u2011year increases in recent 2025 releases\u2014below the ~20%+ peaks seen in 2024\u2014signaling that premiums remain elevated even as momentum moderates (BLS CPI). […]<\/p>\n","protected":false},"author":345,"featured_media":352205,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1266],"tags":[],"post_author":[],"yoast_head":"\nThe 5 Biggest Mistakes People Make on Car Insurance - Reviews.com<\/title>\n<meta name=\"description\" content=\"Finding affordable car insurance takes time and research, but taking these five steps could result in much lower car insurance premium costs.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.reviews.com\/insurance\/car\/5-biggest-mistakes-people-make-on-car-insurance\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The 5 Biggest Mistakes People Make on Car Insurance - Reviews.com\" \/>\n<meta property=\"og:description\" content=\"Finding affordable car insurance takes time and research, but taking these five steps could result in much lower car insurance premium costs.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.reviews.com\/insurance\/car\/5-biggest-mistakes-people-make-on-car-insurance\/\" \/>\n<meta property=\"og:site_name\" content=\"Reviews.com\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Reviewscom\/\" \/>\n<meta property=\"article:published_time\" content=\"2025-11-07T17:09:39+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.reviews.com\/wp-content\/uploads\/2020\/08\/GettyImages-771456103-scaled.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1440\" \/>\n\t<meta property=\"og:image:height\" content=\"996\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Reviews Staff\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@Reviews\" \/>\n<meta name=\"twitter:site\" content=\"@Reviews\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Reviews Staff\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"7 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.reviews.com\/insurance\/car\/5-biggest-mistakes-people-make-on-car-insurance\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.reviews.com\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"The 5 Biggest Mistakes People Make on Car Insurance\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.reviews.com\/#website\",\"url\":\"https:\/\/www.reviews.com\/\",\"name\":\"Reviews.com\",\"description\":\"Your Guide to the Best Services\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.reviews.com\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"The 5 Biggest Mistakes People Make on Car Insurance - 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