Shoppers can save on policies by comparing costs, managing coverage, finding discounts

With money tight these days, the good news is that annual auto insurance rates are currently the lowest they’ve been in more than a year, averaging $1,871 according to the Web site Insurance.com. Even better news is that many motorists can cut their premiums further by picking the right vehicle, shopping around for the best rates and taking advantage of every possible discount program the industry has to offer.

For starters, it pays to choose a make and model that costs inherently less to insure in the first place. The quickest and costliest sports cars generally command the highest premiums, with minivans, SUVs and passenger sedans generally being the cheapest to insure. Still, there can be significant differences within given classes of cars, depending on their claims histories and other factors.

Usually, the biggest differences in insurance costs between models will come with collision and comprehensive coverage (for physical damage to the vehicle and theft) and medical payments premiums (for injuries to the driver and passengers). Typically, liability coverage isn’t affected by a policyholder’s car choice, although owners of high-performance sports cars could be charged higher rates in this regard on the assumption that they intend to drive them in the aggressive manner for which they were designed. What’s more, drivers of the largest SUVs, like the massive Hummer H2, might pay somewhat higher liability rates because their vehicles inflict more damage to others in collisions.

Insurance giant State Farm provides ratings for damage and theft indexes, vehicle safety discounts and liability rating indexes on its Web site (Statefarm.com), which can be used to help pick a car that costs less to cover.

Besides identifying a lower overall rate, many motorists can reduce their insurance premiums even further by tweaking a policy’s coverage and/or deductibles. The larger a deductible is, the smaller the premium for specific coverage will be. Most drivers can afford to have a $200 deductible on comprehensive and collision damage, but taking a $500 deductible could save from 15% to 30% on this coverage. Those driving an older model that would cost more to repair than replace could extend their savings by as much as 40% by canceling their comprehensive and collision coverage altogether.

Dropping medical payments coverage (it’s redundant for families with conventional health insurance) rental reimbursement (especially for those owning multiple cars that can be called into service if one gets into an accident) and towing coverage (unnecessary for those having a new-car roadside assistance plan or who belong to an auto club) can likewise save money.

Also, insure more than one vehicle on the same policy. This is the insurance industry’s version of a “volume” discount. Rate reductions among most companies range from 10% to 25%. Likewise, consolidate insurance policies – larger companies will cut auto premiums by around 15% if they also carry a family’s homeowner’s policy.

Savvy insurance shoppers can qualify for additional rate reductions by driving fewer miles per year, keeping a vehicle in a garage, car-pooling, attending driver training school, installing aftermarket anti-theft devices and so on. Senior citizens usually get a break on policy costs, as do students who boast a “B” average or better.