From Bob Irish in the Wealth Builders Club: Americans overpay for car insurance by an average of $368 annually, according to a recent study. In most states, you’re legally required to have car insurance. But you’re probably shelling out more than you need to.

Here are five steps you can take to slash your car insurance bill.

  1. Keep points off your driving record. Your state’s Department of Motor Vehicles keeps a record of all your driving transgressions. So if you have moving violations, speeding tickets, or an accident or two, you’ll pay more. If your driving record is clean, you may qualify for a “safe driver” discount. A bad driving record takes a while to improve. Depending on the state you live in, points don’t disappear for about three years (five in Wisconsin).

  2. Improve your credit score. Most insurance companies use your credit history to determine your premium. A high credit score means you’re likely to get a better rate than someone with a low credit score. If your credit rating is spotty right now, it will take time to repair it. (See how to do it in the Wealth Builders Club’s Debt and Credit Solutions series.)

  3. Move. Okay, you probably won’t move just to save on insurance. But your ZIP code influences how much you’ll pay. In Los Angeles, for example, a move from ZIP code 90045 (near LAX) to 90005 (Sanford) will bump up your premiums by an estimated 47%. Rural areas have lower premiums than urban areas. ZIP codes with higher car theft and accident claims are riskier for insurance companies. So, they charge more to compensate for their expected losses. Use this calculator to find out how your premium might change if you move.

  4. Carefully choose the car you drive. It will cost more to insure a luxury car than an economy car, and more to insure a sports car than a small SUV. For example, according to a study by Insure.com, it costs an average of $3,574 per year to insure a Nissan GT-R Nismo. And an average of $1,134 to insure a Jeep Wrangler Sport. And if you own one of the most-stolen cars, you can count on a high premium. You can find the average premium for over 1,000 models here.

  5. Comparison shop. Get quotes from at least three insurers. You can find the lowest-priced insurers on your state’s Department of Insurance website here. While you’re there, be sure to check out the number of consumer complaints that have been lodged against each company. Often, but not always, the cheapest price comes with terrible customer service.

If you’re not careful, insurance can be one of the largest wealth stealers in your life. Wealth Builders Club members can refer to Wealth Stealers #8 to read five more important ways to slash your auto insurance bills.