Everybody wants discounts for their vehicle insurance. And why not? Whether its 2% or 20%, its money that you don't have to pay. Our website researches and monitors the deepest cost premium reductions that are offered to consumers, and we present them to you in an easy-to-read format. As new discounts are introduced each year, we review details and show you how it can lower your premium. Additional reductions are also available on homeowners and renters policies.
Throughout the year, these reductions can translate into huge savings...perhaps as much as thousands of dollars, depending on how many cars and drivers are in your household. The higher your premium, the more valuable discounts become. And typically, once you earn that price break, it will stay applied to your policy for many years. Most of the decreases are permanent, although students with good grades may lose part or all of the reductions after graduation, or when they reach age 25. Multi-policy, good-credit, and loyalty discounts typically remain on policies for many years.
We have provided one of the most comprehensive lists of available discounts below. Not all of the reduction are offered by every insurer. Ten of the largest companies were considered and they include: State Farm, Allstate, Geico, Progressive, Farmers, USAA, Liberty Mutual, Nationwide, Travelers and American Family. NOTE: Other large carriers, such as Hartford, Erie, Esurance, Mercury, Auto-Owners, and AAA, also offer similar options. Bankrate helped provide some of the research. MetLife sold their property and casualty book of business to Farmers, so they were not considered.
Multi-Policy -- Offered by every carrier, and typically in the 10%-20% range. Of course, you must own a vehicle. However, a few carriers allow the savings if more than one family member has an active policy, even if they are in different households. On commercial policies, savings on a fleet of vehicles becomes more substantial, often as much as 30%. Once you drop to a single vehicle on the policy, you'll notice a big difference.
Several companies allow the discount if one of the policies is an ancillary product, such as life, health, or dental coverage. Occasionally, savings is transferred to a family member covered on a different policy that resides at a different address. When dependent children leave the policy for their own separate coverage, a discount may continue. However, accumulated loyalty discounts may not transfer as easily, and often are not offered on the newly-written policy.
Good Driver -- The amount of the reduction varies. Usually, the level of savings increases every few years. So, although the initial amount may only be 5%-10%, it is conceivable it could eventually reach 20%-30%. An at-fault accident, depending on the carrier, will only impact the driver assigned to that vehicle, and not the entire cost of the policy. However, Liberty Mutual and others, under certain circumstances, will not surcharge for the first at-fault accident.
With multiple vehicles and youthful drivers in the household, the savings can be substantial. Low-claim drivers are also provided more liberal underwriting when termination is considered. Transitioning to cost-per-mile policies (if available) will save money for customers that have substantially reduced their driving. Several companies offer this option and policy rates can vary. Newly-added rivers to a policy may also earn discounts quicker if the adult drivers have a long history of safe driving.
Longevity -- Many carriers including State Farm, Progressive and Farmers, discount prices based on the number of years you have been their customer. In some situations, you have to be accident or claim-free. So it may not help if you have been with the same company for 20 years with three at-fault accidents and several additional claims. But the combination of loyalty and a clean record could yield some impressive price reductions. Conversely, if a company continuously offers noncompetitive pricing, you should have left years ago. Many Group plans through employers offer generous reductions. MetLife, for example, offered an "employment tenure" discount, although with the Farmers acquisition, that discount may be discontinued.
Good Student -- Everyone offers this discount. Reductions range from about 5%-20%. However, typically, the savings applies to the vehicle the student drives. And a "B" or "80" average must be maintained. Proof must be provided at least a few times per year. Of course, especially for teenagers, it is so important to stay under the speed limit. We have included many teenage driving tips that should be a must-read for parents.
If your young driver can stay accident and ticket-free for their first three years, you'll be richly rewarded with savings. The reduction generally continues throughout graduate school and sometimes medical school. Upon graduation, if a separate policy is required, prior discounts and credits may continue.
Student Away -- A little different than the previously mentioned discount. To qualify, you must attend school (typically college) a specific number of miles away from home. Usually that number is in the 45-90 (or more) range. Geico and USAA don't offer this yet, but we hope they do in the future! Often, if the school is more than 500 miles away, a much more significant reduction may be offered, including not charging any extra premium for your student. It is rare, however, when a carrier totally excludes a youthful for rating purposes, since this may assume your son or daughter stays in school for summers as well. Studying abroad for 12 months should qualify the driver for the reduction although a US license must be maintained.
Multi-Car -- Typically in the 10%-22% range, all companies offer this option. Although it has been reported that Allstate does not offer this reduction, I have not found that to be true. Also, some companies extend the savings to other family members outside of the household. In those situations, there are additional requirements to retain the discount, and it may disappear at age 25. This reduction is also offered on classic and antique autos, that may be covered under a separate policy. There is no extra reduction for covering an unusually high number of vehicles (such as five). RVs, mobile homes, motorcycles, snowmobiles, and ATVs typically don't count. Under a separate ancillary policy, some credits may continue.
Good Credit -- Good credit standing will not only help you secure a lower interest rate on a loan, but it may save you big bucks on your insurance policies (not just auto). Recently, many reliable research reports indicate that safe drivers are more likely to have better than average credit. Persons with superior credit have the fewest claims of all categories that were studied. Your savings will vary, but expect a nice reduction if your combined FICA score is above 750. If it's above 800, several companies will add more savings. Several carriers will also apply a discount if your score is above 700. Adverse credit typically will not harm your rate.
If you have a credit score below 700, or have bankruptcies in your recent past, we will focus on carriers that don't utilize credit when determining rates. There are many insurers that will offer low premiums despite recent credit or financial issues. The importance of your credit rating also extends to many other areas, including buying a home, refinancing or consolidating loans, and borrowing money. It may also impact the rating you receive when applying for life, long-term care, or disability insurance coverage. A "super-preferred" rating may require excellent credit.
Go Green -- No, not the vehicle. But if you agree to have all billing correspondence emailed or electronically faxed, this will apply. Most carriers offer either a limited or full discount. Within a few years, you may see rate reductions by exchanging paper billing for electronic billing, if allowed by the state Department Of Insurance. Since email alerts are much more efficient than a late-payment warning sent in the mail, we encourage all customers to consider receiving all correspondence online. Cancellation notices will likely always be sent via US mail, along with additional electronic options. Since ID cards are required in all states, copies or duplicates can always be mailed, without jeopardizing the discount.
Green Car -- Many hybrid vehicles qualify, and Farmers and Travelers were two of the first companies to give you a credit. Some of the most popular hybrid cars that qualify include the Honda Insight, Toyota Prius, Honda CR-Z, Honda Accord, Chevrolet Malibu, Kia Niro FE, Toyota Camry Hybrid Sedan, Hyundai Sonata, Ford Fusion, Ford Focus Electric, Chevrolet Volt, Nissan Leaf, Lexus RX, Toyota RAV4, Ford Escape, Toyota Avalon, BYD e6, Lincoln MKZ, Nissan Rogue, Tesla Model X 75D, Tesla Model S 75D, Buick LaCrosse, Smart Fortwo, Fiat 500e, Honda Clarity EV, BMW i3, BMW X5 PHEV, Lexus RS 450h, Chevrolet Bolt EV, Audi Q5 e, Audi Q8, Volkswagen e-Golf, Hyundai Ioniq Electric, and Volkswagen Jetta. We expect many more vehicles to be added to the list by 2023. There are many more 2022 available models, compared to previous years.
Anti-Theft -- Most major carriers offer the discount, along with a reduction for single or dual air bags. Having anti-lock brakes will also help with most carriers. You can purchase a wide range of systems both online or locally. If installation is required, it may be best to have a dealership or trusted body shop perform the work. The "gadget" alarms that sell for less than $30 are generally not very effective. Of course, there is also the "Club," which is a steering wheel lock device that has been used for decades. It costs about $15 and its bright yellow color is a clear warning to potential car thieves. Note: "Active" vs. "passive" alarms generate the biggest savings.
Armed Services -- If you served, you get a reduction of about 5%-10%. State Farm, Geico, Progressive, USAA and Farmers participate in this patriotic gesture. An honorable discharge may be required, although proof is generally not needed. If a son or daughter participates in ROTC, a small reduction in premium may be offered. Additional carriers are adding the reduction each year, and all services are included.
Limited Driving -- If you rarely a drive a vehicle (typically less than 3,000-6,000 miles per year), you'll earn a discount from Travelers, Liberty Mutual. USAA, Progressive, Allstate and State Farm. Other carriers have break points at 10,000 miles (sometimes 7,500). The installation of an electronic monitoring device (Progressive's Snapshot Program) will automatically reduce the premium, and additional reductions may be applied, depending on your driving habits. Of course, if you roll through stop signs, or suddenly stop and start, the device will not help. A "friendly" beep also can be heard when you approach a stop sign too quickly.
Early Enrollment -- If you don't wait until the last minute to change companies, often you will be rewarded. That is, if you need an effective date of the 15th of the month, by starting the application process on the 5th instead of the 14th, you may save money. Allstate, Farmers, Nationwide, Travelers and American Family will offer that break. Others are expected to add this reduction within the next 12-18 months. Carriers that conduct the most online business tend to offer the most attractive pricing.
Method Of Payment -- Although many consumers prefer the monthly billing option because it is the most convenient and requires the smallest cash outlay, you may be paying more than you realized. Unless it is an automatic electronic withdraw, there may be some hidden fees (or maybe not hidden) of about $2-$5 per payment. Semi-annual or annual payment plans are the best deal, although you will have to make a much larger payment. Quarterly billing is sometimes available but also may include an administrative fee. Credit-card payments are sometimes accepted to avoid a lapse, or if it is the initial payment to start the policy. But ongoing credit card payments, if offered, may include a 1.5%-4% fee.
Group Affiliation -- Almost all of the large insurers have group agreements with specific large employers (such as Verizon, Time-Warner, MetLife Microsoft, Cisco etc...) where if you are an employee of these companies, you may earn a reduction of approximately 2%-10%. A payroll-deduct option through your paycheck may also be available, which allows you to make smaller automated payments. If you leave the employer or are terminated, you can convert to a different mode. Each year, the lists grows, so it's worth asking your employer each year if they participate. "Loyalty" benefits may reduce your premium of you are a long-term employee of the company.
It's also important to understand that a carrier that offers fewer consumer discounts, does not necessarily charge more for their auto insurance coverage. It's very possible that Company A may charge $500 semiannually with very few or no discounts while Company B charges $650, utilizing six different discounts. Also, "sign-up" credits disappear after the first policy period.
We can help you save money on insuring your vehicles. With more than three decades of experience working with the top-tier companies, we spend most of our time monitoring and comparing prices, so you are always presented with the best options. Instantly, you can can request a quote and view which discounts you qualify for, and the specific property and casualty products that offer the most competitive pricing in your area.