Student Auto Insurance Discounts: How Much Can You Save?

Car insurance rates are typically higher for young and inexperienced drivers, as they are considered high-risk. However, students can benefit from various discounts to make their insurance more affordable. The top providers of car insurance offer at least one discount for students, with the availability and amount varying by state and insurer. Students can save between 4% and 20% on their car insurance by getting good grades, with a requirement of a 3.0 GPA or a B average. Other ways for students to save on car insurance include taking driver's education courses, being part of certain organisations, and bundling policies.

Good student discount

A good student discount is an auto insurance policy discount available to young drivers who earn good grades in school. Teen drivers are the age group with the highest rate of accidents, which is why insurers tend to charge more to cover them. However, insurance companies assume that young drivers who are responsible in their studies are more likely to be responsible drivers.

Most insurance companies offer good student discounts to those who can demonstrate strong academic performance. This usually means maintaining at least a "B" average or a GPA of 3.0 or above. Some companies also accept alternative proof of academic achievement, such as:

• Good standardised test scores (SAT, ACT, PSAT, etc.)
• A letter signed by an administrator testifying to your academic achievements
• Ranking in the top 20% of your class
• Inclusion on the dean's list or honour roll

The amount you can save with a good student discount varies depending on the insurance company and your location. On average, students can save between 4% and 20% on their car insurance premiums. For example, State Farm offers a discount of up to 25%, while GEICO offers up to 15% off certain coverages. The typical savings amount to around $22 per month for minimum-coverage insurance, but good students can save up to $174 per month by shopping around at multiple companies.

In addition to good student discounts, students can also take advantage of other car insurance discounts, such as those for safe driving, away-from-home students, and bundling policies.

Good driver discount

A good driver discount is a reward for being a safe driver. Insurance companies take different approaches to offering these discounts, but they generally apply to drivers who have not had any accidents or violations in the past three to five years.

Accident-free discount

Many major companies offer discounts to drivers who have had no accidents in the past three to five years.

Violation-free discount

If you've avoided any traffic violations in the past three to five years, you're likely eligible for a discount.

Safe driver discount

Some insurance companies combine the accident-free and violation-free rewards, offering a single safe-driving discount to drivers who have avoided incidents and accidents within the past three to five years.

Usage-based insurance

Also known as telematics insurance, usage-based insurance monitors your driving—usually via a mobile app or a device installed in your car—and offers discounts based on your performance. Most major companies offer some type of usage-based insurance.

Lowered premiums

Instead of offering a specific discount on premiums, some companies lower your rates if you've managed to avoid an accident for a specified period of time.

Defensive driving course discount

In addition, drivers can often earn a discount by taking a defensive driving course. While these courses are generally geared toward young drivers and drivers over 50, certain states make them eligible for all drivers.

To get a good driver discount, you must maintain a clean driving record, which is typically defined as a record free of any accidents, speeding tickets, or other violations within a specified time period, usually three to five years.

Affinity membership discount

There are a variety of organisations that offer affinity membership discounts on car insurance. For example, GEICO offers an affinity membership insurance perk to members of fraternities, sororities, honour societies, and alumni or university organisations. Other insurance companies offer similar discounts to members of specific clubs or companies, such as the BMW Car Club of America or the Mercedes-Benz Club of America. Alumni associations, colleges, and universities may also offer these discounts to their members.

In addition to these, certain professions are also eligible for affinity membership discounts. Medical professionals, government employees, teachers, engineers, and accountants may qualify for these discounts. It's worth checking with your insurance provider to see if your profession is eligible.

To qualify for an affinity membership discount, you will need to provide proof of your membership in the organisation. This could include a copy of an employer picture ID, a letter from your employer, or a copy of a pawn or loan receipt. Contacting your insurance agent or carrier is a good first step to determine your eligibility for any membership discounts.

Student away from home discount

Students who live away from home where their family resides can qualify for a discount on their car insurance. This is called the distant college student discount, student away at school discount, or the student away from home savings package. This discount is not for the student but for the parents or guardians of the student. This discount applies when the student attends and lives at a college or university away from home and does not have their own vehicle, meaning they are only likely to drive their family car when they are at home during breaks.

To qualify for the student away at school discount, the policyholder must have a student under the age of 25 listed on their auto policy who drives their insured car. The student must be attending and residing at a school more than 100 miles from home and should not have a car at school. The student can only drive the insured car occasionally, such as during school breaks or holidays.

The amount of money saved with this discount varies. It can be anywhere from 15 to 30 percent off your policy. This discount can also be coupled with other discounts, such as the good student discount, to increase savings.

Driver's education course discount

A driver's education course discount is a great way to save money on your auto insurance. These discounts are offered by most insurance companies and can provide significant savings for young and new drivers.

Completing a driver's education course can help reduce insurance premiums, especially for teenage and new drivers. The exact discount amount may vary, but it typically ranges from 10% to 15%. The curriculum usually includes a review of traffic rules, vehicle handling techniques, laws about licensing, and vehicle documentation procedures—all essential knowledge for any driver. Many of these courses can be taken online, offering convenience and flexibility.

It's important to note that the requirements for earning a driver training discount may differ depending on your state and insurance provider. While some states accept online courses, others mandate in-person attendance at an approved location. It's always a good idea to check with your insurance agent or provider to confirm your eligibility for any discounts.

In addition to driver's education course discounts, insurance companies often offer other student discounts, such as good student discounts for maintaining a certain grade point average or being on the honour roll. There are also discounts available for students who are members of specific organizations, such as fraternities, sororities, or alumni associations.

By taking advantage of driver's education course discounts and other student discounts, young and new drivers can significantly reduce their auto insurance premiums. It's recommended to shop around and compare quotes from different insurance providers to find the best rates and discounts offered.

Frequently asked questions