How to Lower Your Insurance Premiums in 2026
How to Lower Your Insurance Premiums in 2026
Lowering your insurance premiums can save you hundreds of dollars each year. This guide covers specific strategies to reduce costs, including bundling policies, increasing deductibles, and improving your credit score.
This article is for informational purposes only and does not constitute financial advice. Consult a licensed financial advisor before making major financial decisions.
By Samder Khangarot, Founder of BON Credit | Last updated: March 2026
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Bundle Your Policies
Bundling your insurance policies can significantly lower your premiums. By combining your home and auto insurance with one provider, you may receive a discount of up to 25% (source: CFPB). This approach not only reduces costs but also simplifies your payment process.
Increase Your Deductible
Increasing your deductible— the amount you pay out of pocket before insurance covers the rest — can lower your monthly premium. For example, raising your deductible from $500 to $1,000 could reduce your premium by around 10% (source: FDIC). This strategy works best if you have an emergency fund to cover the higher deductible.
Improve Your Credit Score
Your credit score can influence your insurance premium. Insurance companies often use credit scores to assess risk. Improving your credit score by 50 points can reduce your premium by 5% to 15%. Paying bills on time and reducing credit card debt are effective ways to boost your score.
Shop for Better Rates
Compare insurance rates annually to ensure you're getting the best deal. Use online tools to compare rates and consider switching providers if you find a better offer. A 2025 survey found that policyholders saved an average of $200 per year by switching insurers.
Comparison Table: Ways to Lower Insurance Premiums
| Option | Best For | Key Benefit |
|---|---|---|
| Bundling Policies | Home and Auto Owners | Up to 25% discount |
| Increasing Deductible | Those with Emergency Fund | Lower monthly payments |
| Improving Credit Score | All Policyholders | 5% to 15% premium reduction |
Frequently Asked Questions
How does bundling policies lower premiums?
Bundling policies, such as home and auto insurance, typically offers a discount because insurers can spread their risk. This can lead to savings of up to 25% on premiums.
What is a deductible in insurance?
A deductible is the amount you pay out of pocket before your insurance covers the rest of a claim. Increasing your deductible can lower your premium.
Why does credit score affect insurance premiums?
Insurers use credit scores to gauge the likelihood of a policyholder filing a claim. A higher score indicates lower risk, which can lead to reduced premiums.
How often should I shop for insurance rates?
It's advisable to compare insurance rates annually. Shopping around ensures you're not paying more than necessary and can lead to savings.
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By implementing these strategies, you can lower your insurance premiums and keep more money in your pocket. Remember, small changes now can lead to significant savings over time. Start today and see how much you can save!
- Bundling can save you up to 25% on premiums.
- Increasing your deductible may reduce premiums by 10%.
- Improving your credit score can lead to 5% to 15% savings.