Everyone loves a good discount, especially when it comes to something as essential as car insurance. The struggle to save money on car insurance is real, and also trying to score those elusive discounts can feel like trying to find a needle in a haystack.
It seems like every insurer has a different set of rules, and figuring out how to qualify for those discounts can be downright confusing.
First off, it’s important to understand that insurance companies offer discounts based on various factors, such as your driving record, the type of car you drive, your age, where you live, and even your credit score. The cost of car insurance often varies from state to state, some are priced decently while others are a bit on the high side.
One intelligent means to beat the rising costs is to look for and take advantage of car insurance discounts. This is the purpose of this post.
In this post, we will go deep into the world of car insurance discounts, the strategies that work, the pitfalls to avoid, and how to speak the language of insurance companies to get what you deserve.
Read: How to Get Lower Car Insurance Rates
Types of car insurance discounts
Car insurance discounts differ from one another. Often, its percentages are dependent on the type of discount and companies that are offering it. Discounts can be as low as 5% or as high as 25%, and in some scenarios, you can get even more generous discount percentages. Let’s go over the most common types of discounts.
Multi-policy discount
This discount can only be applied when you purchase car insurance together with other policies, such as homeowner insurance, from the same company. Doing this will set you up for a multi-policy discount.
This is what they call a “multi-line discount,” and it gives you a car insurance discount that cuts between 5% to 25% off. Popularly referred to as “bundling,” it involves combining more than one coverage into one.
Combining your home and auto insurance can result in some of the largest savings typically 5% to 25%. Don’t worry, though, if you’re not the property owner; you can usually combine your car insurance with other policies, including life, renters, motorbike, boat, and RV insurance.
Remember that this represents the discount on the car policy. You can also be eligible for a bundling discount on your other insurance such as home, condo, or renters, depending on the provider.
Multi-car discount
If you insure multiple vehicles with the same insurance provider, you may typically take advantage of this multi-car insurance discount. The typical savings that are advertised range from 8% to 25%.
The way a multi-car insurance policy operates is that it insures two or more vehicles under a single policy. Likely, a family with at least two vehicles garaged in the same place is experiencing this.
Notifying the auto insurance provider that you wish to add more automobiles to your household’s coverage is all that is required to set up a multi-car insurance plan.
The primary prerequisite for obtaining multi-car insurance is that all the vehicles included in the policy must be owned by family members living at the same address.
This restriction does not apply to colleagues who are temporarily living away from home. Typically, auto insurance companies under this circumstance, permit the student’s car to stay on the family multi-car policy, but don’t count on it. To figure out if that is an option, speak with your insurance agent.
Safe driving discounts
Automobile insurance discounts of this kind honor safe driving practices. They contribute significantly to customer savings on auto insurance. These are the savings that insurance companies most frequently offer. You can be eligible for a discount if your automobile has safety features like airbags, anti-lock brakes, and daytime navigation lights.
While airbag discounts for full-front seat airbags can amount to up to 40% of the cost of medical expenses or injury-related expense coverage, daytime running lights usually only offer very minor savings.
Discount for defensive driving (10% to 15%)
A 5% to 10% reduction on liability, accident, personal injury, and medical expenses coverages may be available to drivers who enroll in defensive driving courses from an accredited or recognized school. To prevent accidents, drivers are taught in classes how to manage weather, traffic, and road conditions.
However, bear in mind that this discount might only be available to eligible drivers who are at least 50 years old. Discounts for defensive drivers usually run from 5% to 10%. This senior driver discount is required by law in several jurisdictions.
Discounts for cautious and accident-free drivers
If you have not had an accident in three or five years, you can receive discounts from companies such as Allstate, Geico, State Farm, and most others. Usually, an automatic discount is applied. If you have been accident-free for the necessary period but are not eligible for registration, you can change your rate when you renew next year.
For specifics, verify with your agent as the definition of a “good driver” varies slightly with different insurers.
Read: How Much Will Insurance Pay for My Totaled Car?
How to get discounts on car insurance
Getting car insurance discounts is not a walk in the park. Many insurance companies have differing rules and guidelines on how to qualify and receive discounts. If you are seeking a discount, it is important to check in with the insurance company adequately even if you have received similar discounts from the same company.
This is because some things are likely to change over time. Follow these guidelines to help you get the best discounts you qualify for.
Utilize a carrier website for research
You see, you don’t have to wait until you buy a car before you find out about car insurance discounts. This is an information era and knowledge is power. You can simply begin with a few clicks and learn a whole lot on websites.
Carrier websites often provide a list of discounts, eligibility criteria, and steps to claim these discounts.
Find out what a licensed insurance agent thinks
After you’ve done your research you can approach a licensed insurance agent to share the discounts you found out about and listen to what they think about it.
Now, because these are experts they may have specific knowledge about some discounts that may not be readily found on the website. They’d put you through state-specific discounts and other things you may miss out on.
Ask your family members and friends
Interestingly, these may be the last people you consider for such questions because you might feel that they’d probably not know jack about it but that’s far from the truth.
Many times, they can serve as good referrals for insurance companies they have used or probably using.
Asking your family and friends to share their experience with their current car insurance providers could give you a glimpse into the best carriers available. All you have to do is to lend them listening ears.
Track your driving habits
Bad driving habits are a turn-off for many insurance companies. To get car insurance discounts, your driving habits and culture must be in line with the stipulations of the insurance company.
Unnecessary tickets, reckless driving, and causing a nuisance on the road ought to be avoided. Your aim should be to have an untainted driving record.
You can also take a record of your mileage. This will help you know your driving frequency as it can help you assess how well you qualify for mileage discounts.
Read: How to Save on Car Insurance
Loyalty and policy renewal
If you keep renewing your coverage, a lot of auto insurers will give you discounts. Get in touch with your insurance provider if your renewal date is drawing near to see if you qualify for a loyalty discount.
In any case, it’s never inappropriate to look into alternative solutions. You just might find another insurer that gives a better loyalty discount than your current insurance company.
Discounts for full payments
Policyholders can frequently obtain a paid-in-full discount from their insurer when they pay the complete premium at once.
After completing the quote process, you might be able to see paid-in-full reductions if you’re buying a new policy. Find out if paid-in-full savings apply if you’re renewing existing insurance by getting in touch with your insurer.
In addition, several insurance companies reward policyholders who pay their rates -aannually semi-annually, or quarterly rather than monthly savings on auto insurance. Find out if the insurer gives any other payment schedule discounts if you are unable to afford to make the entire amount.
Discounts for automatic payments
A lot of auto insurance providers give discounts to customers who select automated payments. Usually, you may arrange recurring payments with your debit card or credit card, or you can set up regular payments with an electronic funds transfer from your bank account.
Although they have certain disadvantages, automatic payments can also be an excellent way to make sure your coverage doesn’t lapse. You must have the money available for withdrawal in line with your payment schedule if you decide to use automated payments.
Should the funds be unavailable, you can be liable for fines and penalties assessed by both your insurance and bank. If you don’t pay, there’s also a chance that your insurer will cancel your insurance.
You may also want to consider getting independent agents if you would like help comparing quotes from different insurance companies. You may truly save a significant amount of money by working with independent agents. Their relationships with different insurance providers allow them to present you with several options and assist you in selecting the one that best suits your needs.
It is simple! Simply get in touch with a handful of local independent agents and request quotes from several insurance companies. After obtaining some basic information from you, such as your driving record and the kind of coverage you want, they will compare prices.
Even better, you can rely on independent agents to provide you with objective advice because they are not affiliated with any single insurance provider. Additionally, they can frequently bargain for lower prices on your behalf.
