15 ways to identify, understand, compare, and shop for the best discounts
Taking advantage of auto insurance discounts can be a great way to save money, especially when it comes to monthly expenses like auto insurance premium. However, to get the most out of car insurance discounts, you must be able to identify, understand, compare, and shop for the best ones.
Car insurance discounts fall into three types: vehicle, policy, and driver. Let us find out which one applies to you.
Driving a safe car can have a big impact on the cost of your car insurance. Auto insurance companies usually offer discounts to drivers whose vehicles are outfitted with certain standard safety features that can either prevent car theft or help drivers drive more safely.
Some of these safety features include:
An anti-lock braking system (ABS) prevents your vehicle from skidding by retaining traction between the tires and the road. Most insurers require vehicles to be installed with ABS to qualify for this discount. This discount could mean 5-10% off your collision coverage premium.
These features include airbags and seat belts. Vehicles with passive restraint systems are subject to discounts of 25-30%. These discounts are applied to personal injury or medical payments portion of your insurance premium.
Daytime Running Lights
Daytime running lights reduce collision accidents. Having them could get you a 3% discount on certain car insurance premiums.
These include car alarm systems, hood locks, VIN etching kits, and vehicle recovery devices. These tools make a car more theft proof and could earn a discount of up to 25% on the comprehensive portion of your premium.
Car Insurance Discounts Based on Policy
Policy discounts are more dependent on your arrangement with your insurer, as well as the contract structure. For good relationships, your insurance provider can give a discount that can be applied to your total premium. Policy discounts include:
- Most auto insurance providers offer significant discounts if you insure two or more vehicles on one policy. It becomes even more convenient when families combine policies under the same insurer. Some insurers such as State Farm give as much as 25% on multi-car policy discounts.
Bundling or Multi-Policy Discount
- Auto insurance companies offer discounts to clients who combine multiple lines of insurance such as homeowners insurance and vehicle insurance. Although the discount is not equally applied to each bundle, insurers can give up to 25% discount off your policies.
- Most insurance companies enjoy cash flows, and the motorists who provide them. While there are numerous payment plans that can help drivers stretch out the cost, insurers will convince you to pay your annual premium upfront by offering you a discount. This discount can lower your entire policy premium by up to 10%.
- If you opt for an e-bill or set up an auto-payment bank account where you can automatically pay your premiums, you can be eligible for this discount. Although this type of discount is uncommon, it can earn you a 5-10% discount for keeping your bills paperless.
Car Insurance Discounts For Driver
These types of discounts reward drivers based on their driving record and accomplishments. If your driving record is clean, you stand a higher chance of getting a discount on your car insurance policy. This can save you a sizeable chunk of savings on car insurance rates.
Common driver discounts include:
- If you have not been into an accident for three years, then you are eligible for this discount. This is usually the first issue that insurers look into, and it influences how each piece of your auto insurance policy is calculated.
- Different from good driver discount, safe driver discounts are offered to drivers for good habits such as low driving speeds, less aggressive speeding and having all passengers wear seat belts.
- This discount is given to full-time students in high school, college or other technical school and has an average grade of “B” or rank scholastically in the upper 20% of the class.
- This could mean a new opportunity for motorists who are 55 years or older and who have completed a car accident prevention course. Some insurers such as Allstate offer discounts of up to 10% in form of a senior discount.
While auto insurance companies will be aggressive in boasting about their discounted rates, not all the discounts will be clearly advertised. Some of which will be found in the frequently asked questions section while some will be particular to certain states.
Therefore, whether it’s insuring multiple cars, bundling, or being a safe driver, talk to your auto insurance company and get to know what discounts you may be eligible to, or what adjustments you might make to qualify.