Auto Insurance Discounts: How To Save On Your Policy

Car insurance can be expensive, but there are many discounts available to help you save money. The most common types of discounts include those for driver history, affiliations, vehicle-related features, personal traits, customer loyalty, and policy-related factors.

Driver history discounts are often given to those with a clean driving record, free of accidents, speeding tickets, and other violations. Affiliation discounts are based on your job, school, or clubs you're associated with. If you're a federal employee, in the military, or a veteran, you may qualify for a discount. Vehicle-related feature discounts apply to cars with safety add-ons, anti-theft devices, or electric vehicles. Personal trait discounts include those for good students and homeowners. Customer loyalty discounts reward those with multiple policies or cars insured, and policy-related discounts are earned based on how you buy and pay for your policy, such as automatic payments or paying in full.

Other discounts include those for bundling policies, safe driving, low mileage, professional/academic organizations, anti-lock brakes, and more.

Be sure to ask your insurance provider about all available discounts, as they may not be automatically applied.

Student discounts

Students who are enrolled in high school or college and can maintain a certain average grade (typically a "B" or higher) may be eligible for student discounts on their auto insurance. Here are some examples of student discounts offered by popular insurance companies:

GEICO

GEICO offers three ways for students to save on their auto insurance:

• Good Student Discount: Available for students who maintain a "B" average or better.
• Good Driver Discount: For students with a clean driving record for five or more years.
• Affinity Membership Discount: For members of fraternities, sororities, honour societies, alumni associations, or university organisations.

Nationwide

Nationwide offers a good student discount for students aged 16-24 who are enrolled full-time in high school or college and maintain a "B" average or higher. Proof of enrolment and grades is required. They also offer a safe driver discount for drivers with a clean record for the past five years.

Allstate

Allstate offers a smart student discount for eligible drivers under 24 who are unmarried and meet one of the following requirements:

• Maintain a "B" average or a GPA of 2.7 or higher.
• Provide proof of performance in the top 20% on standardised tests such as the PSAT, SAT, or ACT.
• Complete Allstate's teenSMART® driver education program.
• Attend a school or university more than 100 miles away from the insured vehicle's garage location.

State Farm

State Farm's Steer Clear program allows young drivers under 25 to earn a safe driving certificate through a mobile app. Requirements include no at-fault accidents or moving violations within three years, completion of a five-course lesson plan, five hours of driving practice, and submission of a mentor log. State Farm also offers standard student discounts for students away at school, good drivers, driver training, and good students with a GPA above 3.0.

Liberty Mutual

Liberty Mutual offers two ways for students to save: a good student discount for those with a "B" average or better, and a student away-from-home savings package for students residing more than 100 miles from the residence and vehicle listed on the policy.

Progressive

Progressive offers a good student discount of up to 10% for full-time students with a "B" average or higher. They also provide a distant student discount for students aged 22 or younger who live more than 100 miles from home and don't have a vehicle at school. Additionally, they offer a teen driver discount for parents adding a driver 18 or younger to their policy.

Safe driver discounts

Some insurance companies offer safe driver discounts in the form of a percentage off your premium, which can range from 10% to 30% or more. For example, State Farm offers its Drive Safe & Save program, which provides a 10% initial participation discount and up to a 30% discount on auto insurance based on your driving behaviour. Similarly, Nationwide offers an instant 10% discount just for signing up for their usage-based insurance program, SmartRide.

In addition to safe driver discounts, insurance companies may also offer driver behaviour discounts or good driving discounts, which take into account your overall driving record and habits. These discounts may be based on specific actions, such as enrolling in a defensive driving course, or more general factors, such as having a clean driving record.

It's important to note that the availability and eligibility requirements for safe driver discounts can vary by state and insurer. Therefore, it's recommended to contact your insurance provider or a local agent to confirm the specific details of any safe driver discounts that may be available to you.

Multi-policy discounts

The main advantage of multi-policy discounts is the savings that can be made. For example, bundling home and auto insurance with Liberty Mutual can save policyholders an average of $947 annually. According to Kelley Blue Book, multi-policy discounts can reach as high as 25%. Additionally, having multiple policies with the same insurer means having a single point of contact, reducing administrative hassle.

Some insurance companies that offer multi-policy discounts include:

• Allstate: Up to 25% discount when bundling home and auto policies.
• Nationwide: Up to 20% discount when bundling home and auto insurance.
• Liberty Mutual: Average savings of $947 annually when bundling home and auto insurance.
• Progressive: Average savings of $793 annually for new customers when bundling home and auto insurance.
• GEICO: Up to 25% discount when bundling auto and homeowners insurance.

To qualify for a multi-policy discount, contact your insurance provider and inquire about eligible policies. It's important to note that not all types of policies may qualify for bundling, and each insurer has its own requirements for eligible policies.

Vehicle safety discounts

Vehicle safety is a key factor in determining auto insurance discounts. Here are some ways in which vehicle safety can help you save on your auto insurance:

Vehicle Safety Equipment Discounts

Safety equipment such as anti-lock brakes, dual airbags, and other safety features can often lead to small insurance discounts. These safety features reduce the risk of accidents and injuries, which is favourable for insurance companies. Make sure to check with your insurance provider about the specific safety equipment that qualifies for a discount.

Anti-Theft Device Discounts

Anti-theft devices, such as alarms, steering wheel locks, GPS-based systems, and VIN etching, can help you save on car insurance. These devices not only give you peace of mind but also reduce the risk of theft, which is favourable for insurance companies. Be sure to inform your insurance company if you have any anti-theft devices installed, as this may qualify you for a discount.

New Vehicle Discounts

Some insurance providers offer discounts for vehicles that are less than three years old, with potential savings of 10% to 15% on your premium. This is because newer vehicles often come with advanced safety features and technologies that make them less likely to be involved in accidents or require costly repairs.

Alternative Energy Discounts

If you own an environmentally friendly vehicle, such as an electric car, you may be eligible for an alternative energy discount. Some insurance carriers, like Travelers, offer this discount regardless of whether you own or lease the vehicle. This discount recognises the reduced fuel costs and lower environmental impact of these vehicles.

Airbag Discounts

Full-front seat airbags can provide significant discounts of up to 40% on your medical payments or personal injury protection coverage. Airbags are a crucial safety feature that can reduce the severity of injuries in the event of a collision, making them valuable in the eyes of insurance companies.

Daytime Running Lights Discounts

While not as significant as other vehicle safety discounts, having daytime running lights on your vehicle may provide you with a small discount. These lights improve visibility and reduce the risk of accidents, especially during dawn, dusk, or low-visibility conditions.

Remember that the availability and eligibility requirements for vehicle safety discounts can vary by insurer and state. It's always a good idea to contact your insurance provider to understand the specific discounts offered and how you can take advantage of them.

Anti-theft device discounts

Anti-theft devices are a great way to protect your vehicle and also save on your auto insurance. Many insurance companies offer discounts for vehicles with anti-theft devices installed, as they help deter car thieves and reduce the risk of vehicle theft. Here's everything you need to know about anti-theft device discounts:

Types of Anti-Theft Devices

Anti-theft devices can be categorised into three main types: manual or active devices, automatic or passive devices, and remote disabling systems.

Manual disabling devices require physical activation by the driver. Examples include steering wheel locks, brake locks, and kill switches. Steering wheel locks immobilise the steering wheel, preventing movement and theft. Brake locks prevent the gas pedal from being pushed down, while kill switches disable all electricity in the vehicle.

Automatic disabling devices work without any manual intervention and are often installed in newer cars. Transponder keys, for instance, must be present in the vehicle for it to be driven, preventing hot-wiring. Audible alarms are another passive device that triggers a loud alarm when unwarranted touch is detected.

Remote disabling systems are a newer type of anti-theft technology. These devices connect to your smartphone, allowing you to decelerate, downshift, or lock the brakes remotely. They are more commonly used in commercial vehicles than personal cars due to their higher cost.

Other anti-theft devices include vehicle tracking systems, such as GPS trackers and subscription services like OnStar, which can help locate your vehicle if it's stolen.

How Anti-Theft Devices Affect Insurance Rates

Anti-theft devices reduce the likelihood of vehicle theft, and some can even help law enforcement locate stolen vehicles. As a result, insurance companies may consider you a lower-risk driver and offer a discount on your insurance premium. Comprehensive insurance, which covers vehicle theft, is typically required for leased and financed vehicles. By having an anti-theft device, you can reduce the cost of this coverage.

Getting an Anti-Theft Device Discount

To take advantage of an anti-theft device discount, contact your insurance provider to inquire about specific discounts and requirements. Some companies may require proof of installation, especially for devices installed after purchasing the vehicle. Discounts may also vary based on the type of device and the level of protection it provides. For example, a steering wheel lock that disables the vehicle may be more likely to be approved for a discount than standard automatic door locks.

Remember that anti-theft device discounts are just one way to save on auto insurance. Combining multiple discounts, such as good driver discounts, student discounts, and policy discounts, can lead to substantial annual savings. Always review your insurance policy and ask about available discounts to ensure you're getting the best deal.

Frequently asked questions