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I’m off work right now, so I’m not driving much. I want to lower my car insurance payments, but I don’t want to get a deferral that I’ll just have to pay back later. What are my options?

In the early days of the COVID-19 shutdown, one of the first things insurance companies did was let you defer your payments and pay them later.

But that meant your next payment could be twice as much, or more, than usual.

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“I’ve seen a lot of companies offering 90-day deferrals, and some are making it more indefinite until this ends,” says Matt Hands, business unit director at Ratehub, a financial-comparison site. “Whatever you’re deferring, you’ve got to make sure you can pay it down the road.”

So if you’re considering a deferral, make sure to ask when you have to pay it back.

Some companies will ask you to pay it all back in the next payment, and others will let you spread that payment out over the year, Hands says.

Instead of postponing your payments, call your insurance company and ask for other ways to pay less during the shutdown. Here are a few ways to potentially save a few bucks on your monthly payments:

See if you can get a discount – or even a refund: Some companies have already been offering discounts. In Ontario last week, the provincial government temporarily suspended the rules against discounts, so more companies might start to offer them. Some discounts are automatically applied to all customers.

“For example, Allstate is offering a 25-per-cent discount for the month, and it’s being applied to all of their customers,” Hands says. “Their customers should expect to see a cheque in the mail, or they’ll get it by direct deposit.”

Another company, Onlia, is giving all its home and car insurance customers a free month without any payments at all.

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But for many available discounts, you need to call your company and let them know that you’re in trouble, Hands says.

Tell them you’re driving less: If you’re working from home, or not working at all, and you’ve stopped commuting every day, you can lower the number of kilometres allowed on your policy. “The amount of time you spend on the road equals risk for your insurance company,” Hands says. “It will vary by the person, but you could see a decrease of up to 10 to 15 per cent.”

Reduce your coverage: If you’re driving less, you could get rid of coverage you might not need. For instance, you may be able to get by with less liability coverage, which covers damage and injuries that a driver causes to other people, vehicles or property.

The minimum required in most provinces is $200,000, while it’s $50,000 in Quebec and $500,000 in Nova Scotia. But going too low is risky because it could leave you liable if you’re sued, Hands says.

“A lot of people have one or two million dollars in third-party liability,” Hands says. “I wouldn’t recommend going too low.”

Increase your deductible: The deductible is what you have to pay out of pocket when you’ve been in an at-fault crash.

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“A lot of people have $500 to $1,000 and you can increase it up to $2,000, although it varies by company,” Hands says. “Doing that, you could save anywhere from $20 to $25 a month.”

But it’s a risky change to make if you can’t afford to pay that higher deductible if you do get in a crash.

If your policy is due soon, shop around: You could save by switching to another insurance company, especially if that company uses telematics to track how much you drive. But if you cancel your existing policy before it’s up for renewal, you could pay cancellation fees. They range from $25 to a percentage of your overall premiums, depending on the company.

Take your car off the road: If you’re not driving at all, you could suspend coverage entirely,

“Your vehicle would be considered to be illegal on the road,” Hands says. “You would just suspend the coverage you don’t need, so it would still be covered for theft or vandalism, if you have that coverage.”

You might not be able to eliminate payments entirely, but you could cut them substantially, he says. “Aviva has stated that you can save up to 75 per cent by suspending coverage.”

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He says that while there are often fees for suspending coverage, most companies are waiving them for COVID-19.

Have a driving question? Send it to globedrive@globeandmail.com. Canada’s a big place, so let us know where you are so we can find the answer for your city and province.

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