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Guide to car insurance discounts available in the market

  • Auto Insurance
  • Xavier Sabastian
  • 7 minutes

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Expenses, such as registration fees, fuel, and repair costs, are beyond your control. However, you can reduce the cost of car insurance. The average cost of car insurance for a 30-year-old driver in the United States is $2004 per year, including liability, uninsured motorist coverage, and collision and comprehensive coverage. Obtaining discounts is one strategy to lower your auto insurance premium.

There are more than a dozen typical car insurance discounts available, some of which you may not be aware of. Get in touch with your insurance agent. They can undoubtedly help you get all of the discounts you’re eligible for.

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A guide to car insurance discounts

To discover average ranges, we looked at discount percentages from 11 of the country’s major car insurance companies when they were available. Significantly your insurance company can offer you larger or lower discounts.

Usage-based insurance program discount

Usage-based insurance (UBI) is a type of insurance that modifies your insurance costs based on how often and well you drive. UBI systems give a discount for signing up (usually between 5% and 10%), followed by a discount based on your real driving habits.¬†The discount is usually applied at the time of policy renewal. It’s worth noting that a UBI discount might not be available for your full insurance.

Multi-policy discounts

When you buy car insurance and other policies from the same insurance company, you may be eligible for a multi-policy discount. It’s also known as “bundling” and referred to as a “multi-line discount.” Bundling car and home insurance are usually one of the most cost-effective ways to save money, with savings ranging from 5% to 25%.

Homeowners get a 13% discount, condo owners get an 11% discount, and renters get specifically a 7% discount. Depending on your insurance company, you may also qualify for a bundling discount on your other policies (home, condo, or renters).

Multi-car discounts

You can typically get this discount if you cover more than one car with the same insurance company. 

Multiple car insurance discounts can help you get savings

Discounts for safety features

You may be eligible for a discount if your vehicle has anti-lock brakes, airbags, and daytime running lights. Airbag discounts are one of the most used discounts. Daytime running lights are typically very small discounts. 

Discount for buying a new car

Cars less than three years old are generally eligible for a new car discount, ranging from 10% to 15%.

Discounts for theft protection devices

If your car includes anti-theft measures, you will be eligible for a reduction of up to 25% on your comprehensive coverage. Anti-theft discounts may be available for both factory-installed and aftermarket installed devices, depending on the insurance company.

Here are some examples of anti-theft systems that can aid in the recovery of a stolen vehicle and possibly result in a discount:

  • GPS-based systems:¬†Some cars include services like OnStar or Toyota’s Safety Connect, which use GPS to track down a stolen car. Some devices, such as OnStar’s “Remote Ignition Block,” can prevent a burglar from starting your car.
  • Stolen vehicle recovery systems:¬†Systems like LoJack assist law enforcement in tracking and recovering your stolen car by transmitting a silent radio signal to a transceiver installed in the car. Your car insurance provider can give you a discount if you show documentation of the installation.
  • VIN etching: The vehicle identifying number (VIN) is permanently etched on the windshield and windows of a car. It serves as a deterrent to car thieves who would otherwise have to remove and replace VIN-etched glass before selling your car. Some car insurance companies will give you a discount for having your VIN etched. They will also eliminate your comprehensive coverage deductible if your car is stolen.

Discount for being a good driver

Typically, a car insurance company will want you to be accident-free for some time. You might be eligible for a discount if you haven’t had any accidents, auto insurance claims, or traffic offenses. Discounts for good drivers often vary from 10% to 40%.

Defensive driver discounts

If you agree to take an approved defensive driving course, several insurance providers will discount you. However, consider that this discount may only be available to qualifying drivers over the age of 50. Defensive driving discounts are usually in the range of 5% to 10%. 

Good student discount

Car insurance companies normally need students to have a B average and be between 16 and 25. We discovered excellent student discounts ranging from 8% to 25%.

You can also get a discount if your student is away at school and does not have access to a car. Car insurance companies have different requirements, but most need students under the age of 25, live more than 100 miles away from home and have access to their car only during school vacations and holidays.

student car insurance discounts

Discount for paying upfront

Car insurance providers usually give you a discount if you pay for your entire policy term up in advance. If you pay your insurance premium in full rather than in monthly installments, top firms offer discounts ranging from 6% to 14%. Aside from the discount, spreading out the payments will save you money on some providers’ monthly finance or service fee.

Discount for EFT payment

You may be able to earn a slight discount if you pay in installments and use automated withdrawals. The EFT discount might be anything between 3% and 6%.

Discount for paperless transactions

You’ll receive your insurance documentation and billing electronically if you’re willing to go paperless. The insurance carrier may offer a minor discount. People nowadays prefer paperless solutions. Thus this discount isn’t as common as it once was.

Discount for getting online quotes

Certain car insurance companies will offer discounts if you acquire an online quote and sign up for coverage. This can be anywhere from 4% and 12%.

Discount renewing insurance early

Shopping around and purchasing a policy before your current one expires can result in a reduction. The discount normally ranges from 2% to 15%.

Discount based on your profession and alumni associations

You may be eligible for discounts based on your profession and your alumni associations.  

car insurance discounts

Things to remember when getting car insurance discounts

Discounts on car insurance aren’t always what they appear. When you see a discount offered with “up to 30% off“, you might think, “Big savings!” But that doesn’t mean you’ll get 30% off your entire car insurance premium.

Here are a few things to keep in mind:

Be wary of the phrase “up to”

Discounts are typically listed as “up to” a particular percentage.¬†It’s possible you won’t get that percentage.¬†

Some discounts will not apply to your bill

Since comprehensive coverage covers auto theft, anti-theft device discounts may only apply to comprehensive coverage.

Some state laws require discounts

Any insurance provider will give you state-mandated discounts. In New York, drivers who complete a defensive driving course and submit a certificate of completion to their insurance carrier are eligible for a 10% reduction on liability and collision coverage for three years.

Discounts are usually capped

Although you may be eligible for various discounts, the insurance provider will normally cap the total discount percentage. For example, you could stack up savings that look like 60% off your auto insurance (hey, new espresso machine!), but the total could only be 20%.

Certain discounts aren’t automatically applied

The easiest approach to save money on discounts is to regularly ask your insurance agent to check the available discounts. You may need to request them, particularly if you’ve had the same policy for several years. Since your insurance company will be unaware of certain factors. This can include your car’s new anti-theft device or that your great grades.

car insurance offers from way.com

 

Discounts vary as per states

It’s possible that a discount advertised on an insurance company’s website isn’t accessible in your state.


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