3 Ways Americans Are Coping With High Car Insurance Costs

Car insurance just seems to keep getting more expensive. And now the total cost of car ownership is forcing many Americans to rethink their personal finances and find savings in other ways. A recent survey from car ownership app Jerry found that Americans are cutting back on other everyday spending to help cover the ever-rising costs of car insurance.

Let's look at a few ways that Americans are trying to save money to keep up with car insurance bills -- and how you can lower your premiums in 2024.

1. Spending less on groceries, restaurants, and clothes

According to Jerry's State of the American Driver 2024 report, 58% of Americans are cutting back on spending on restaurant meals, clothing, and groceries because of the rising price of car insurance and other car ownership costs. A whopping 69% of millennials and 80% of Gen Zers are cutting back on these other expenses so they can keep paying for their cars.

There's nothing wrong with being frugal in your everyday spending and getting the best deal on groceries. Many people love to save money by cooking at home. But if the cost of car insurance is holding you back from enjoying life or having fun evenings out with friends, it might be time to shop around for better insurance price quotes.

2. Cutting back on car insurance coverage

The Jerry survey also found that, in response to skyrocketing premiums, 22% of drivers bought less car insurance coverage than they wanted in 2023. Younger drivers were especially likely to cut back on coverage: 32% of millennials, and 39% of Gen Zers, chose to settle for less insurance protection than they would have preferred.

It's true that raising your deductible or opting out of certain optional coverages can reduce your auto insurance premiums. But sometimes this can leave you exposed to extra costs if you get in a crash -- like rental car cost and towing.

Even if you can't afford comprehensive coverage and you're comfortable taking the bus or paying for your own rental car in case your vehicle ends up at the body shop for a few weeks, think long and hard before you cancel your collision coverage. Choosing a liability-only insurance policy can leave you vulnerable to disastrous out-of-pocket costs. Unless your car is extremely old and worth very little money, it could still be worth insuring in case of a total loss.

3. Sharing driving data for safe driver discounts

With rising car insurance premiums hitting people's budgets hard, more drivers are showing an interest in telematics car insurance, where people can sign up to share driving data with their insurance companies. The Jerry survey found that 54% of drivers would be willing to let their insurance companies monitor their driving electronically in exchange for the possibility of a lower premium.

If you're open to sharing some of your driving data with your insurance company, you may want to try telematics insurance in 2024. The best insurance companies that offer these special safe driver discounts give you the chance to lower your premium by as much as 30%-40%.

Bottom line

The whole point of owning a car is that it's supposed to give you freedom, choices, and put your life in motion. Your car is supposed to help you go shopping for stylish outfits, take weekend road trips, and meet your friends for dinner at a nice restaurant. Your car should not be so expensive that it forces you to give up all of those fun experiences!

If car ownership costs are impacting your finances and sapping the joy out of your life, it's time to make some changes. But based on recent survey data, it looks as if many people are making a surprising mistake: they're not searching for better auto insurance prices. The Jerry survey found that only 38% of drivers shopped around for car insurance. The Ascent's recent research also shows that 52% of drivers compare auto insurance quotes "rarely" or "never."

Don't assume that you're stuck with your current auto insurance company, and don't feel like you have no options. Even if you've recently had a car accident, you might be surprised at how affordable a different insurer or policy might be. Making the effort to shop around for auto insurance price quotes could be an underrated way to save money on insurance.