Car insurance can be costly, but there are methods to minimize your monthly premium by looking for a discount.
Auto insurance discounts that are common
Before you start looking at particular insurers, it’s a good idea to understand the many types of discounts offered.
Car insurance savings come in a variety of forms.
Here’s a more in-depth explanation of how to acquire vehicle insurance discounts:
Military personnel, whether active or retired, are frequently eligible for discounts. Those who work for companies linked with the insurer and many federal employees may be eligible. Many carriers provide affinity discounts in addition to military and employer discounts. Some university graduates, as well as members of fraternities and sororities, may be eligible for discounts. Teachers, police officers, firefighters, and medical personnel may also be eligible.
In most cases, slight discounts are available for vehicles equipped with anti-lock brakes, dual airbags, or other safety equipment. Discounts may only apply to the personal injury or collision components of your insurance policy. Automobile insurers may also offer a discount if you purchase a new vehicle or possess an electric or hybrid vehicle.
Even if you don’t have homeowners insurance, auto insurers may discount you if you own a home. In addition, insurers frequently provide discounts to older folks (usually 55 and up), though some require you to complete a defensive driving course to qualify.
Many insurers provide a discount to students with a B average or higher. In addition, some firms provide an additional reduction if you have a student away from home (with limited car access) on your policy.
History of the driver
Have you had your policy for more than three years and not had an accident? Have you ever taken a defensive driving course? Did the adolescents on your policy complete driver’s education classes? All of these criteria can contribute to your eligibility for discounts.
If you don’t mind sharing your data, some organizations, such as Allstate’s Drivewise, can save you hundreds of dollars. These programs employ telematics technology to give savings and prizes or to build a tailored insurance premium by tracking your driving behavior with a mobile app or gadget that plugs into your car’s diagnostic port. Telematics programs may provide you with a discount based on your driving habits, but your base insurance premium will not be modified.
A usage-based policy, such as Progressive’s Snapshot, decides your insurance quote in part based on your driving habits. Other criteria, such as your age, gender, and car make and model, are still considered with these policies. If you are not a cautious driver, usage-based policies may raise your premiums.
Long-term clients and those who have multiple products are rewarded with savings by insurers. When you transfer your house insurance to your auto insurance carrier, for example, you may be eligible for a discount. You can also save money by insuring many vehicles with the same carrier.
A word of caution concerning loyalty discounts: Because loyal clients are less likely to transfer companies, some vehicle insurers utilize a process known as pricing optimization to charge them higher rates. That is why, even if you are receiving a loyalty (or other) discount, it is critical to compare vehicle insurance prices. Your final premium may still be greater with your current insurer’s loyalty discount than with another firm.
Coverage discounts based on how you acquire and pay for your policy are among the simplest to obtain. Many insurers will offer discounts to consumers who pay in full, switch to automated payments, or receive electronic bills. In addition, customers who sign up for new insurance before the previous one expires, usually seven days before the current term finishes, may be eligible for a continuous coverage discount from some carriers.
Suggestions for lowering car insurance costs
Discounts are not always obvious. Just because one company offers a three-year accident-free discount does not imply that the following firm will follow the same criteria. Here are some pointers to consider when shopping for vehicle insurance discounts.