Auto Insurance Discounts
Auto insurance discounts fall into mainly three different categories. They are : Driver, policy and vehicle. Apart from these there’s one more category which is ‘usage based’. However, car insurance discounts may vary widely from company to company. We will explain the different types of discounts below, so that you are better informed when you receive your car insurance quotes from agents/brokers/direct providers.
Types of car insurance discounts:
Based on the driving history, student status, professional organizations, age, and how and when they use their cars, many organizations offer discounts of several types. These discounts reward drivers for safe and responsible driving habits.
Good Driver / Accident-Free driver:
If you have a history of driving without accidents for 3 to 5 years, then you can easily claim this discount on your policy. This factor affects every piece of your car insurance coverage’s calculation and is the first factor insurers take into account when they quote you. If you don’t qualify at signup, you could keep checking your status – upon policy renewal, and adjust your premium if you have stayed accident-free for their required period of time. Also, you do not always lose your discounts if you get into minor accidents. There is a monetary threshold that insurers have that determines which accidents are chargeable and usually if your claims are below $500 they will not affect your record and premiums. You have to check with your agent to find out what your insurer’s interpretation is for good drivers. Insurers such as GEICO and Allstate give out higher discounts as you maintain your accident-free status longer.
If you are a good student and having a B average and higher, it is not only beneficial for your future career achievements, it also helps you cut down your car insurance costs.
Professional Organization / Employee discounts:
There are many insurance companies having affiliations and partnerships with other organizations. If you are a member of an organization that provide their members or employees with additional discounts for insuring their vehicles, you can save money while buying your car insurance.
Defensive driving course:
You may be able to get a discount of around 10-15% on your liability, collision, and personal injury or medical payment coverage if you have a proof of defensive driving lessons from a certified or registered school. These classes generally teach drivers how to better assess road, traffic, and weather conditions to avoid accidents. Some companies while quoting your rate, might ask whether you've taken defensive driving lessons. But you can even get the discount in the middle of your policy. If you want to take up the course, check with your insurer to see if they require being a senior citizen to be eligible for these reductions, before signing up for the course.
Low mileage and usage:
When you get a quote, insurers will ask about your average annual mileage. For example, if your daily commute between work and home is less than 10 miles one way, you might qualify for a discount. So, if your mileage falls under a certain cap, then many companies might offer you a good discount.
B. Vehicle Discounts:
The vehicle that you own can have an effect on your car insurance or on the discounts that you may be offered. Insurance companies may give you discount based on the features or you have in your vehicle that would decrease their risk.
Having a number of safety devices installed in your car can help you get discounts on your car insurance
Devices such as hood-lock, car alarm system, passive disabling system are good for your vehicle. But having these installed in your car can also help you get discounts on your car insurance.
Most insurers require ABS to be factory-installed in order for a vehicle to qualify for this discount.
Safety device, as an airbag or special seat belt, that is activated automatically to protect an automobile passenger at the moment of impact when a collision occurs.
If you have a new car, you could avail a discount to reduce the cost of your physical damage coverage premium. This however differs by insurer and state.
Vehicle Identification Number (VIN):
Some insurers may offer you a discount if you have your VIN etched on the windows of your car. Some companies might require your VIN etched on all windows for your car to be considered for this discount.
C. Policy Discounts:
If you are a family, then you could combine everyone’s policy or vehicles under the same insurer. That way, you could save money by getting discount from your insurer.
There are insurance companies who might offer you a discount if you pay your full premium upfront. There are number of payment plans to help drivers stretch out the cost, but most insurers will encourage you pay your entire 6-month or annual premium up front by giving you a discount.
Renewal of your premium:
If you continue renewing your policy with the insurer year after year, they might reward you with a good discount for being their loyal customer.
Bundling / Multi-Policy Discount:
If you have multiple assets to protect, such as auto and home, you can combine them and save on your insurance costs by placing them with the same company. The bundle can come in many combinations, such as auto + home, auto + boat, and auto + home + umbrella policy, etc. and each results in a different amount of premium reduction.
Every company is different and different states have different rules, so discounts will vary by company and might also vary by state. So, while purchasing auto-insurance, always compare and then shop and definitely ask for any discounts that might apply to you.