How Good Grades Can Lower Auto Insurance Premiums

Young drivers are often charged higher insurance premiums due to their increased risk of accidents. However, insurance companies assume that young drivers who are responsible when it comes to their studies are more likely to be responsible drivers. As a result, they are less likely to file insurance claims and therefore deserve to pay lower insurance premiums. This is where good student discounts come in.

Good student discounts are offered by most insurance companies to young drivers who can prove they have achieved good grades in school. The exact discount varies between companies, but it typically ranges from 10% to 25%. To qualify, students usually need to be under a certain age (often 25), enrolled as a full-time student, and have a minimum grade point average of a B or 3.0.

Good grades and lower premiums

Young drivers are often charged more for car insurance because they are considered high-risk. Teen drivers aged 15 to 19 have the highest accident rate of any age group, and inexperienced drivers are more likely to get into car accidents and commit traffic violations. As a result, insurance companies tend to deem young motorists as high-risk drivers and price their coverage accordingly.

However, insurance companies assume that young drivers who are responsible when it comes to their studies are more likely to be responsible on the roads. Therefore, they are seen as less likely than teens with poor grades to file claims on their car insurance and so deserve to pay lower insurance premiums.

Good student discounts reward high school and college-age drivers who earn good grades with lower premiums on their car insurance. Individual insurance companies that offer good student discounts set their own guidelines for the required grade-point average and the amount of the discount. Most insurers require a minimum of a B average, although some ask for a 3.0 GPA or higher.

Good student discounts can offer significant savings on car insurance premiums. The average discount is around 12.5%, but this can vary from 4% to 25% depending on the insurer. For example, State Farm offers a discount of up to 25%, while Geico caps its discount at 15%.

To qualify for a good student discount, you must be a full-time student and usually under the age of 25. You will need to submit proof of your academic performance to your insurer, such as a copy of your latest report card or transcript. Some insurers may also accept alternative proof, such as a letter from the school's dean or membership of an honour roll.

Other ways for students to save on car insurance

While good student discounts are a great way for students to save money on their car insurance, there are also other discounts available. These include:

• Driver's training discount: Many insurers offer discounts for completing a defensive driving course.
• Distant student discount: Students in college who are living away from home and do not have a vehicle may be eligible for extra savings.
• Affiliation discounts: Some universities, fraternities, and sororities have negotiated discounts with certain insurance carriers.
• Telematics discounts: Some insurers offer discounts for safe driving habits monitored through an app or in-car device.

Proof of good grades

To qualify for a good student discount on car insurance, you must provide proof of your academic performance. This usually takes the form of a school transcript or a copy of your report card. Some insurers may also accept a letter from the principal or another school administrator.

If you are homeschooled, you may need to take a state or nationally-mandated test, such as the California Achievement Test or the Iowa Test of Basic Skills, and submit your scores as proof of your academic performance.

The specific requirements for a good student discount vary among insurance companies, but common criteria include:

• Maintaining a minimum grade point average (GPA) of a B or higher
• Being enrolled as a full-time student
• Being under a certain age limit (e.g. 25 years old)

It's important to note that insurance companies may request proof of your grades not only when you initially sign up for the discount but also at each renewal period. Therefore, it's essential to maintain your grades and provide updated documentation as needed to continue receiving the discount.

Student discount percentages

Some companies, like State Farm, offer a generous discount of up to 25% for students who maintain high grades. Other companies, like GEICO, offer a slightly lower discount of up to 15%. The largest good student discount is currently offered by Allstate, at around 20% off. However, their rates are more expensive than average, even after the discount.

It's important to note that the availability of good student discounts and the specific requirements may vary by state and insurance company. Students should compare quotes from multiple insurance providers and ask about the availability of good student discounts to find the best rates.

In addition to good student discounts, there are other ways for students to save on auto insurance. One way is to remain on their parents' auto insurance policy, which can result in significant savings. Another way is to take advantage of affiliation discounts offered by universities, fraternities, sororities, or the military. Completing a defensive driving course or being a safe driver can also lead to discounts.

Overall, good student discounts can provide substantial savings for students, but it's important to shop around and compare rates to find the best deal.

Student discount savings

Young drivers are typically charged more for car insurance due to their higher risk of accidents. However, insurance companies assume that young drivers who are responsible when it comes to their studies are more likely to be responsible on the road. As a result, they are less likely to file insurance claims and therefore deserve to pay lower insurance premiums. This is where student discount savings come in.

Insurance companies offer student discounts to young drivers who can prove they are achieving good grades at school. The exact requirements vary between insurers, but generally, students must be under 25 years old, enrolled full-time in high school or college, and maintain at least a "B" average or equivalent. Some insurers may also accept scores in the top 20% on standardised tests like the SAT or ACT.

While many insurance companies offer student discounts, the specific savings vary. State Farm, Geico, and USAA are commonly mentioned as offering competitive student discounts. State Farm offers savings of up to 25% for students up to age 25 who maintain good grades. Geico offers a discount of up to 15% for full-time students with a "B" average or better. USAA, available only to military members, veterans, and their families, offers a discount for students aged 16-25 who are full-time high school or college students and maintain good grades. Allstate also offers a generous student discount of around 20%, although its base rates tend to be higher than average.

To obtain student discount savings, contact your insurance company or agent to inquire about their specific requirements and eligibility criteria. You will typically need to provide proof of your academic performance, such as a report card, transcript, or test scores. It's important to note that discount availability and eligibility may vary by state and insurer, so be sure to confirm the details with your insurance provider.

Other student discounts

While a good student discount is a great way for students to save money on auto insurance, there are other discounts available to students to help them save on their car insurance premiums. Here are some other student discounts:

Driver's Education Discount

Many insurance companies offer discounts to students who take an approved driver's education or driver training course. These courses are often aimed at teens and young adults and can help them become safer drivers.

Defensive Driving Course Discount

Taking a defensive driving course can also qualify students for additional savings on their car insurance. These courses teach drivers how to be more aware and cautious on the road, reducing the risk of accidents.

Student Away at School Discount

If a student is attending college away from home and won't be using their parents' car, they may be eligible for a discount. This is because they will be driving less and are therefore considered a lower risk.

Multi-Car Discount

Students who share their car insurance policy with another person, such as a parent, may be able to get a multi-car discount. This is because the insurance company sees this as a lower risk than if the student had their own separate policy.

Vehicle Safety Features Discount

Students who drive cars with safety features such as airbags or an anti-theft system may qualify for additional savings on their car insurance. Insurance companies often view these safety features as reducing the risk of accidents or theft.

Usage-Based Insurance

Telematics insurance apps track a driver's behaviour and reward students for safe driving practices. This includes avoiding behaviours such as speeding, hard braking, and driving during late-night hours.

Frequently asked questions