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Barring a state or two, buying car insurance is mandatory in America, and you can’t avoid the cost of premiums, which can get extremely expensive at times.
But you know what most auto owners miss while buying car insurance? The plethora of discount options that insurance companies offer.
If you know about the types of discounts available, you can end up saving a lot of money. But we understand that not everyone has the time to conduct in-depth research about discounts before buying a policy.
That’s why we are writing this complete guide on car insurance discounts, and we will also provide expert tips on how you can get those discounts from an insurance company.
Ready to start saving? Compare rates with our FREE tool and find the best policy and provider.
Understanding Car Insurance Discounts
Car insurers usually categorize discounts in different buckets for convenience which may vary from one insurer to another. But, most often, discounts on premiums fall within these three categories — your driving history, car safety features, and your policy.
Apart from these categories, insurance companies offer many discounts to auto owners targeted at specific needs or situations, for instance, good student discounts or automated payment discounts.
Let’s first understand the different types of discounts.
– What are some categories of car insurance discounts?
Car insurance companies offer tons of discount options for auto owners. You must be wondering — why, then, are car insurance rates high?
Apart from your personal factors, actuaries in insurance companies must take into account the external factors in your environment that can lead to accidents, which also ends up raising your rates.
For instance, if you live in a city that has a high auto theft rate or registers regular car accidents, those factors will have an impact on your rates.
But you don’t need to worry about the external factors much, because you can get rewards and discounts for being a good driver or for paying the full premium in advance.
|Policy Based||Car Safety Features||Driver Safety|
|Continuous coverage||Anti-theft devices||Safe driver|
|Early signing||Anti-lock brakes||Defensive driving course|
|Full payment||Green vehicle||Accident free|
|Homeowner||New car||Low mileage|
– What are some types of discounts & savings?
Always ask your insurance agents for discounts — it would be best if you can ask about specific categories if you think you have a better chance of getting a particular type of discount.
Since insurance companies keep coming up with new types of discounts, it’s best to always stay informed and read a bit about what’s on offer.
– Policy-Based Discounts
These types of discounts are quite specific to your policy and you can easily reduce your premiums by making a few changes in the policy. Policy-based discounts vary a lot between different insurance providers, so keep this in mind while seeking quotes or for comparisons.
|Type of Discounts||Insurance Providers that Offer these Discounts|
|Continuous Coverage||Allstate, Esurance, Farmers, Geico, Progressive, Travelers,|
|Early Signing||Allstate, Esurance, Farmers, Geico, Nationwide, Progressive, Travelers, USAA|
|Full Payment||Allstate, Esurance, Farmers, Geico, Liberty Mutual, Progressive, Travelers|
|Homeowner||Esurance, Farmers, Geico, Liberty Mutual, Nationwide, Progressive, State Farm, Travelers|
– Continuous Coverage Discounts
Although we always recommend auto owners seek quotes before renewing their policy so they get better rates, there’s no harm in taking advantage of customer loyalty discounts from your insurance provider.
If the loyalty discounts help keep your existing premiums lower than the rest of the quotes, then there’s nothing like that deal.
You can save somewhere between 10 – 15 percent if you have continuous coverage with your insurance provider, but the rate of discount varies.
Some insurance companies offer other types of deals for loyal customers, such as accident forgiveness. Progressive, on the other hand, values auto owners who have been continuously insured in the past and assures consumers that they won’t lose out if they switch to Progressive.
How long do you have to be with an insurer to get discounts?
Not every insurer mentions the period of time you need to be with them to get discounts. But some insurers like Amica Insurance clearly state that you have to continuously insure your car for two years with them to get discounts.
Even if the percentage of discount offered by your current insurer is great, it’s recommended to shop around once in a while for better quotes. Insurance companies offer loyalty discounts to retain consumers and you might get cheaper quotes if you search around.
– Early Signing Discounts
Most of us wait until the last day to renew our auto insurance policy. And when you renew that policy, you check off one more task from the list of all the mundane errands you must take care of during the day.
But did you know you could earn discounts by signing up on a new policy early on?
Many insurance companies want to grab consumers as fast as possible and attract them by offering early signing discounts — expect to earn 10 – 15 percent discounts for renewing a policy before it’s time.
To benefit from this, keep track of the day you must renew your policy to get discounts. Allstate offers discounts to auto owners when they sign up seven days prior to the effective date of the policy.
– Full Payment Discounts
Paying your six-month or annual premium in advance may not be always convenient for you, though it can help in reducing your premiums.
Whenever you get online quotes, you will see an option to pay your insurance premium in advance or set up monthly electronic payments — both of which can help you save money on premiums.
In case you’re seeking offline quotes from insurance agents, make sure you ask about the option to pay in full at a discounted rate. In addition to full payment, insurers also offer discounts on other types of payments.
For instance, at Travelers, you will get discounts if you pay your premiums in full, pay through EFT or payroll deduction, and even when you consistently make payments. You can get up to a 15 percent discount if you qualify for one of these payment modes.
– Homeowner Discounts
Buying a home doesn’t only bring some stability to your life (according to the boomers), but also helps you get discounts on auto insurance.
During the quote process, you can tell the insurance representative that you own your home and ask if there are any discounts for homeowners. Some companies may offer this as an extra perk for those who are homeowners.
If you show that you are faithful to pay your bills promptly, this will also go in your favor.
Simply put, homeowners are considered less risky than those who hop from one rental unit to another. You can expect to save anywhere from 2 to 10 percent on auto insurance if you own a home.
And it doesn’t matter if you are buying your homeowners insurance from the same provider. For instance, Progressive clearly states that you can save up to 10 percent on auto insurance for just being a homeowner.
– Car Safety Features Discounts
When you minimize the chances of a car accident or theft by installing devices or systems to protect your car, you will get discounts from most of the insurance providers. Anti-theft or anti-lock brakes assure insurers that the possibility of you filing a claim is much lower.
|Type of Discounts||Insurance Providers that Offer these Discounts|
|Anti-theft devices||Allstate, Esurance, Farmers, Geico, Liberty Mutual, Nationwide, Progressive, State Farm, Travelers, USAA|
|Anti-lock brakes||Allstate, Esurance, Farmers, Geico, Liberty Mutual|
|Green vehicle||Allstate, Farmers, Liberty Mutual, Travelers|
|New car||Allstate, State Farm, Travelers, USAA|
Since anti-theft devices can prevent theft and even help in the recovery of a car after theft, insurance companies offer discounts to auto owners for installing these devices.
Specifically, the discounts are offered on the comprehensive portion of your coverage and can be somewhere between 10 – 25 percent.
The percentage will be applied to the comprehensive premium only, and not the overall premium.
In general, insurers will give you a discount if you have installed devices like theft alarms, ignition cut-off, or an auto-recovery system. An example of a popular auto-recovery system is LoJack.
A LoJack system isn’t necessarily a theft deterrent like many other passive and active alarms that are offered to new car owners.
Instead, it’s a vehicle theft recovery system that’s meant to be used to locate and recover a vehicle after it’s been reported stolen.
The device that’s installed into the car will work with police to send a signal showing the car’s current whereabouts. Cars installed with a LoJack device have a 90 percent recovery rate.
The percentage of discount can vary depending on the sophistication of the device, but you should keep in mind the cost of the device as well compared to the discounts offered.
For example, a LoJack device will put drivers out almost $1,000. The standard Stolen Vehicle Recovery System has a price tag of $695 for the initial installation. If you buy the advanced program with Early Warning features, you’ll pay $995.
At times, the cost of the device is higher than the actual discount value, so make sure you make those calculations before investing in an anti-theft device.
In twelve states — Florida, Illinois, Kentucky, Louisiana, Massachusetts, Minnesota, New Mexico, New York, Pennsylvania, Rhode Island, Texas, and Washington — insurers are required to offer discounts on comprehensive insurance as per the law if a car is installed with an anti-theft device.
Usually, car insurers offer discounts if you own a car with a factory-fitted ABS system. When you seek an online quote, this discount would be applied to your final premium.
If you can’t see any discounts for ABS, you can speak to an insurance agent regarding the same. Discounts for the ABS system are applied to collision premiums because it can protect your car from damages.
Auto owners can save 3 – 10 percent if they have an ABS system in their car. Specifically, Geico offers a 5 percent discount for a factory-installed ABS system.
Although electric/hybrid/alternative fuel vehicles are expensive to purchase, you can save money on auto insurance premiums if you own one of those vehicles. There are only a handful of insurance providers who offer discounts for a green vehicle which can range from 5 – 10 percent.
Some insurance companies also offer discounts on a new car for which the premium is usually steep because of the high cost of repair/replacement. The definition of new differs from one provider to another.
Travelers will offer discounts of up to 10 percent to new car owners, provided their car is less than three years old. Allstate, on the other hand, offers a 15 percent discount if you’re the first owner of a current or previous year car model.
– Driver Safety Discounts
Nothing can beat the discounts offered by insurance companies for safe driving behavior. Since safe driving is the most important factor that significantly reduces the probability of accidents, you can save a lot by driving safely.
|Type of Discounts||Insurance Providers that Offer these Discounts|
|Safe driver||Allstate, Geico, Nationwide, Progressive, State Farm, Travelers, USAA|
|Defensive driving course||Allstate, Liberty Mutual, Nationwide, Progressive, State Farm, Travelers, USAA|
|Accident free||Nationwide, State Farm, Geico, Liberty Mutual|
|Low Mileage||Esurance, State Farm|
If you engage in safe driving habits, such as always wearing seat belts, abiding by the speed limits, accelerating/braking slowly, you can become eligible for discounts.
Many insurance companies are also offering usage-based insurance programs so they can track driving habits and reward you for safe driving.
While auto insurance discounts can range from 15 – 30 percent, the parameters to assess driving behavior vary across providers.
Progressive claims that if you haven’t been in an accident or traffic violation in the past three years, your rates would be 31 percent lower than the rest on average.
At Nationwide, you become eligible for better rates if you have driven accident or violation free for at least five years.
Defensive Driving Course
Taking a defensive driving course from a registered program is one of the most convenient ways to get an extra discount on your auto insurance premium. The best part is you can complete the course online from the comforts of your home. But not all companies count the online courses toward your discount, so check with your agent or carrier first.
Most agents will ask if you have taken a defensive driving course and apply the discounts if you show them proof of completion.
You can get the details of qualifying defensive driving programs in your state through an agent or the website of auto insurance providers. To become eligible for discounts, you can complete the course at any time during the policy period.
The common myth about driving courses is they are for people with poor records.
The fact is, many auto insurance providers offer huge discounts if you complete driving classes. If you decide to take a defensive driving course, your company may reduce your rate.
Many states even have classroom training courses as refresher courses. These types of learning modules reinforce positive behaviors and help you recognize the bad ones.
This is somewhat similar to safe driver discounts. When you drive accident-free for a certain period of time, you’re eligible for more discounts. Insurance providers either club this with safe driver discounts or offer it separately to reward auto owners who haven’t been in an accident in the past.
You can also become eligible for accident-free discounts during the policy period after you have met the requirements. There is also an accident-free discount known as a No Claim Bonus (NBC). While No Claims Bonuses and accident-free discounts are similar, they are not exactly the same thing.
While the accident-free discount is strict enough on its own, the No Claims Bonus has even stricter guidelines.
Not only do you have to be accident-free, you can’t file any type of other claims against the policy for the savings. To be eligible for this discount, you can’t have filed a claim against your own insurance and there can’t be any third-party claims presented by others as well.
New applicants for coverage also won’t qualify for the NCB during their first term.
Driving a lower number of miles regularly means less exposure to risks on the road which translates to discounts on auto premium. When you seek a quote, either online or through an agent, you will always be asked about your estimated annual mileage. Discounts are applied at this stage if you drive less than the average miles.
You can see the difference in rates below for different mileage in the state of New York.
|Insurance Providers||10 miles commute/6000 annual mileage||25 miles commute/12000 annual mileage|
Although the rates aren’t significantly lower for those driving fewer miles, you can still take advantage of the lower premium if you don’t use your car for regular commute or work from home. Insurers will probably classify your car as a pleasure vehicle if this is the case.
A pleasure vehicle is determined by the number of miles you drive it on an annual basis. Driving less than the limit for pleasure mileage means you most likely qualify for discounts!
Most companies use the 7,500-mile benchmark. If you drive the car less than that, it’s considered pleasure; if you drive the car more that, you’re billed a higher premium.
A pleasure vehicle might be used sporadically, or you may drive it daily. The difference is that you don’t drive it very far even on a daily basis, maybe to the commuter parking lot or the train station to catch mass transit to work.
– Other Types of Discounts
Apart from the above-mentioned categories of discounts, there are other types of discounts, as well, which can’t be put into specific categories or are a different version of the discounts we discussed. Let’s look at what other discounts you can get.
– Multi-Policy Discount
If you have insurance needs other than car insurance, you can bundle all the policies and buy from one provider to get discounts. The most common bundling options are home plus auto. You can save anywhere from 10 – 20 percent on auto insurance if you bundle your policies.
You can ask your insurer about the bundling options they provide so you can save more on insurance. Progressive offers many bundling options to users such as auto + boat, motorcycle + boat, boat + RV, etc.
Since you either own a home or rent an apartment, you always have the option to bundle your homeowners or renter’s policy with auto insurance.
– Multi-Car Discount
If you have multiple cars in your home, you should try to get coverage for all the cars from one insurance provider. Most insurers will offer a significant discount on coverage for multiple cars belonging to one family, but some insurers also offer discounts when roommates insure their car together.
To receive a multi-car discount, every driver need only have the same address, since the location is a primary factor in issuing rates.
You can list anyone on your car insurance policy that resides in the same home, even a roommate.
The majority of car insurance providers offer a discount of 15 percent when you add an additional driver and if they remain on the policy, pay their bill on time, and refrain from filing any claims, many will provide an additional 5 percent every year they renew.
For instance, Progressive offers as much as 12 percent discounts when you add more than one car to a policy which might belong to anyone in the house as long as it’s parked at the same address.
– Student Away Discount
Adding a teenager to your policy immediately spikes your auto insurance rates because young drivers are considered risky by insurers. But, when your kids move to college, you can get discounts on your coverage because they wouldn’t be driving your car as much.
Check the conditions you must meet to get the discounts. At State Farm, you are eligible for discounts if your children under the age of 25 (who also drive your car) move away for college and only drive your car during vacations and holidays.
Some insurers also mention the distance of college from home to determine eligibility for discounts.
– Mature Driver or Senior Discount
If you have been driving for a long time, you could earn some discounts on auto insurance. Auto owners over the age of 50, or seniors, are offered discounts by some insurers because they are usually safe drivers and have different needs than young people.
If you think you could be eligible for senior discounts, you should talk to your agent before buying a policy.
Allstate offers a 10 percent discount to auto owners above the age of 55. You can also consider completing the Mature Driver Improvement course to get more discounts from insurers.
– Passive Restraint Discount
Passive restraint discounts are offered to auto owners who have in-built security features in their cars, such as automatic airbags and seat belts.
Having these features in your car significantly reduces the chance of injuries that you might sustain in an accident, thereby bringing down the financial costs that an insurer would have to reimburse.
Passive restraint features can help you in getting around 30 – 40 percent discounts from some insurers. So if you have spent your money on a luxurious, ultra-safe car, go for those discounts.
– Paperless/E-Bill Discount
Going paperless has more advantages than just saving the environment around you. If you choose to receive your policy documents by email, your insurance provider will offer you a discount. It’s usually not very high, but everything adds up.
– Garaging Discounts
Can I get a discount on auto insurance if my car is in storage?
It’s best to ask your provider if they provide a garaging discount. Many companies offer this kind of discount for classic vehicles, military personnel, and more general scenarios, so ask and be clear about your situation.
Some of may wonder why not just terminate coverage? Well you might be able to to do this but it’s risky.
Some states will allow you to completely terminate your auto insurance coverage if your car is being stored.
“Stored” means to the insurance company is that your vehicle is housed in a locked facility. Having your car on the street corner or in your garage doesn’t usually qualify as being stored.
If you are in a state where you can cancel your insurance, then you will need to hand in your plates to the DMV because they will need proof that your vehicle is not going to be driven.
If you are in a state that still requires some sort of insurance on your vehicle, you may still be able to cancel the liability coverage of on your car.
But you would still need to hand in your tags to the DMV because your vehicle wouldn’t have the minimum required liability insurance in order for your car to be allowed on the road.
Finally, some of you may also be wondering . . .
Will my homeowner’s insurance cover my stored vehicle if it’s not insured?
If you are able to completely strip away all the auto insurance on your stored car then you will be on the hook for any and all damages to the vehicle.
Any possessions in the vehicle will be covered by homeowner’s insurance, but not the car itself.
The options some storage facilities have is to provide insurance for your car if it is stolen or damaged while in their possession.
Moreover, some auto insurance providers have similar auto storage coverage for those who want to make sure any damages or theft upon their automobile is covered.
– What are usage-based insurance program discounts?
Insurers have been offering discounts to safe drivers for a long while now. But usage-based discounts allow them to use technology to track your driving behavior.
Now, this isn’t a bad thing, as some motorists like to claim, because it can accurately assess your driving habits and reward you accordingly.
Here’s an interesting video on how the world of connected devices is helping insurers offer usage-based insurance to auto owners.
So, what exactly is a usage-based insurance?
Usage-based insurance, known commonly as pay-as-you-drive or pay-how-you-drive, are discount programs offered by many leading providers where your driving data is collected through an installed device or mobile app.
When you complete a certain amount of time enrolled in the program, your driving habits are assessed against the set parameters and necessary discounts are applied, if eligible.
With the popularity of telematics devices and the ease of tracking driving data, a large number of insurers have introduced their usage-based insurance programs and offer discounts on enrollment.
|Insurance Company||Program||Device||Enrollment Discount (Up to)||Earned Savings (Up to)|
|Liberty Mutual/SafeCo||RightTrack||Mobile App or Plug-in||5% and up||30%|
|Progressive||Snapshot||Mobile App or Plug-in||Average of $26||Average of $145|
|Mile Auto||Mile Auto||Neither||-||40%|
|State Farm||Drive Safe & Save||Mobile App or Plug-in||5%||30%|
If you want to get some discounts, you can do so instantly by enrolling in a usage-based insurance program. And, if you’re a safe driver, you can get more discounts after the completion of a stipulated time under the program.
With most of the insurance providers, you can save from 20 – 30 percent under their usage-based program. In fact, Metromile offers a discount of up to 60 percent.
Every insurance company has its own set of parameters and assessment criteria for the usage-based insurance programs, so it’s recommended to know about those before enrolling in the program. You can also look at the details below for the usage-based insurance programs of leading insurers.
– Drivewise (Allstate)
In Allstate’s Drivewise program, you can earn up to 10 percent cash back for signing up and up to 25 percent cash back for safe driving every six months.
How can you earn cash back under the program:
- By keeping your speed limit below 80 mph
- By reducing your late-night drives
- By avoiding hard braking incidents
You can download the Allstate mobile app to enroll in the program and see your details.
– RightTrack (Liberty Mutual)
Liberty Mutual promises auto owners can save up to 30 percent with the RightTrack program, which they will retain for life. Along with the savings for safe driving, motorists can save money by signing up as well.
Specifically, RightTrack monitors driving data related to acceleration, braking, nighttime trips, and your mileage.
How does the program work?
Motorists need to be enrolled in the RightTrack program to become eligible for rewards. Once you’re enrolled in the program, you have to download the RightTrack app.
- When you connect your account in the RightTrack app, a telematics device would be sent to your address, which will track details like trip reports, savings, and will even give driving tips.
- You will need to connect the device with the app and drive with the tag for 90 days.
- After 90 days, your discounts will be calculated and applied to your premiums. Expect to earn anywhere between 5 – 30 percent.
– Smart Ride (Nationwide)
With the Smart Ride program, you can save up to 10 percent for signing up and up to 40 percent for safe driving. Smart Ride tracks four driving patterns — miles drive, hard braking and acceleration, idle time, and nighttime driving.
How does the program work?
Nationwide sends a telematics device that measures driving trends over time, and you can check all the details online. After the end of the program (ranging from four to six months), you have to send back the device and get a final discount that’s applied to your next premium payment.
Nationwide clearly mentions on their website that they don’t increase your premiums and Smart Ride is just a discount program.
Which cars are eligible for the program?
All cars manufactured after the year 1996 can be enrolled in the program; however, some diesel-fueled and hybrid cars aren’t compatible.
– Snapshot (Progressive)
As soon as you visit the Snapshot details page on the website of Progressive, you will see their claims about how much they have handed out in discounts through the program. Unlike others, Progressive offers a 30-day trial of their program.
Interestingly, they also mention that, on average, motorists earn a discount of $145 with Snapshot. That’s quite a claim.
How can you enroll in the Snapshot program?
With Snapshot, you have the option to either choose a mobile app or plug-in device to track your driving behavior. In some states, the mobile app option isn’t there, so you must use a plug-in device.
Ways to maximize discounts with Snapshot
- Avoid hard braking and acceleration. Your plug-in device beeps when you slam the brakes, so fewer beeps would translate to bigger savings.
- Between 12 p.m. – 4 a.m., avoid driving as much as possible.
- You can save more by driving less or carpooling with others.
- Stay away from texting or calling or browsing social media.
Your discounts are applied at the end of the program when you renew your policy which is usually six months.
– Drive Safe & Save (State Farm)
If you enroll in the usage-based program of State Farm, you could earn up to 30 percent in discounts by being a safe driver. State Farm offers motorists the option to choose between a mobile app and OnStar to track their driving behavior.
If you select the Drive Safe & Save app, you will be sent a Bluetooth beacon device that will track your driving pattern. What data does State Farm use to calculate your discounts?
- Annual mileage
- Time of day when you drive
- Fast cornering
You can also enroll your OnStar enabled vehicle in the Drive Safe & Save program to earn discounts. You can call State Farm at 888-466-7827 for more details on OnStar.
Metromile offers insurance to motorists on a pay-per-mile model and intends to make coverage affordable for everyone. If you drive less, you pay less for auto premiums.
According to Metromile, auto owners can save as much as $741 per year by buying coverage from them.
Unlike the usage-based programs of other insurance providers, Metromile’s business model is based on usage, which is why motorists can save a lot of money if they drive less.
How does Metromile measure your mileage?
The company installs a small device, Metromile Pulse, to measure the miles driven by motorists. After calculating your mileage, your auto premiums are determined.
– How do discounts impact your insurance rates?
The history of car insurance goes far back to the year 1897 when the first automobile liability policy was sold.
Over the years, insurance companies have modified their policies and included many scenarios that were unimaginable earlier, for instance, damage to your windshield from a drone hit. Laws and regulations have also evolved in these years.
Because of the availability of data from all these years, insurance companies are now able to accurately price policies as per the risk profile of an individual auto owner.
And due to continuous research and information availability, insurers understand that certain driving habits minimize or maximize the probability of an accident or traffic violation. As a result, they offer discounts when auto owners meet certain parameters such as low mileage.
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Which Car Insurance Companies Offer the Maximum Discounts
Now that you know about the types of car insurance discounts, you must be curious about which discounts are offered by different insurance companies. Because every provider has a different set of discounts, how much you save on your coverage can greatly vary from one insurer to another.
Before seeking quotes, you should be aware of the discounts offered by specific providers so you can negotiate with your agents better and take advantage of everything available for you.
– What are discounts offered by insurance companies?
To give you an idea about which companies offer the maximum options for discounts and how much you can save, we have collated the details in the table below.
|Company||Total Number of Discounts||Highest Percent Discount||Best for||Our Company Review|
|Allstate||29||45%||Usage-based and |
|American Family||27||40%||Best value in |
|American Family Review|
|Farmers||34||5%||Married and |
|Geico||31||40%||Teen drivers and |
those with a speeding
ticket or accident
|Liberty Mutual||38||35%||Vehicle recovery |
|Liberty Mutual Review|
|Nationwide||35||40%||Teen drivers and |
best value in
|Progressive||36||31%||Poor credit and DUI||Progressive Review|
|State Farm||19||50%||Poor driving record |
|State Farm Review|
|Travelers||28||30%||Middle-aged drivers |
and poor credit
(especially if single)
We have presented information about the leading providers in America, but you should also check the rates and discounts of local insurance companies, as they might have a better rate because of lower operational costs.
Let’s look at what discounts are offered by these providers.
– Allstate Insurance
Although the rates at Allstate are comparatively higher than other insurers’, you can get a plethora of discount options with them.
On their website, they highlight new car discounts, multi-policy discounts, and smart student discounts. You can see below all the other types of discounts they offer.
- Anti-lock brakes: You can earn up to 10 percent discounts when your car is equipped with anti-lock brakes.
- Anti-theft technology: For an anti-theft device, you can earn up to 10 percent.
- New car: If you’re the first owner of your car, which is a current or previous year’s model, you can save up to 15 percent on your policy.
- Multi-policy: Bundling policies can get you some discounts at Allstate. Buying both auto and home insurance will lead to savings of up to 10 percent on your auto policy.
- Smart student: Teen drivers are eligible for discounts if they meet one of these criteria: they’re full-time students with good grades, have completed the teenSMART® driver education program, or attend school at least 100 miles away from your house.
Apart from these above-mentioned discounts, you can save with early signing discount, responsible payer discount, automatic payments discounts, paperless discount, full payment discounts, and safe driving club discounts at Allstate.
– Farmers Insurance
Since discounts can vary from state to state, Farmers lets you choose your state on their website to see what options you have, which is very convenient for auto owners who want to buy coverage. Their discount options are categorized into four buckets.
- Discounts for the family: Includes savings when you can bundle policies and cars to get discounts.
- Planning ahead discounts: If you own a hybrid or electric car, pay your full premiums in advance, or are a homeowner.
- Classroom discounts: Taking an accident prevention course and being a good student.
- Defensive driving discounts: Protecting your vehicle with anti-theft devices, anti-lock braking systems, VIN etching, daytime running lights, etc. can get you discounts.
Geico offers a massive list of discounts to match the profile of different types of auto owners, which makes them an affordable option for coverage in most of the states.
Their discount options are categorized into five buckets – vehicle equipment, driving history & habits, driver’s education, driver affiliations, and customer loyalty.
Here’s how much you can save with discounts at Geico. The options mentioned in this table are just a fraction of discount options at Geico.
|Type of Discount||Potential Percentage of Discounts||Category|
|Air Bag||25% (driver side), 40% (full-front seat)||Vehicle Equipment|
|Anti-Lock Brakes||5%||Vehicle Equipment|
|Anti-Theft System||25%||Vehicle Equipment|
|Daytime Running Lights||1%||Vehicle Equipment|
|Good Driver||26% (five years accident-free)||Driving History & Habits|
|Seat Belt Use||15% (medical or PIP portion)||Driving History & Habits|
|Good Student||15%||Driver's Education|
|Emergency Deployment||25%||Driver Affiliation|
|Federal Employee (Eagle)||8%||Driver Affiliation|
Geico also offers a lot of options to save money if you are affiliated to certain professional organizations such as military personnel, federal employees, membership to their list of organizations, and emergency deployment discounts.
– Liberty Mutual
Liberty Mutual categorizes its discount in four buckets: your personal factors, your driving, your car, and policy level discounts.
- Personal factors: There are different types of options under this, such as homeowners, military, good student, and student away discounts. The best is if you sign up before your policy expires because you can save up to 45 percent.
- Your car: Advanced safety features, anti-theft devices, and alternative fuel can get you discounts on coverage.
- Your driving: Staying accident or traffic violation free can save you money on coverage. If you enroll in the RightTrack usage-based program, you can save up to 30 percent.
- Policy level: This depends on how your policy is designed, so if you bundle multiple policies or cars, pay in full, choose paperless documentation, buy online, and enable automatic payments, you can earn discounts.
When you switch to Progressive from another insurer and have never been in an accident, you can save up to $699 per year on average.
When you move through the online quotes system of Progressive, you will be asked questions to determine what discounts you’re eligible for, and those will be applied to your final premium in the end. Even then, don’t forget to ask for more discount options.
Here are the different categories of discount for auto owners at Progressive:
- Loyalty-based: Being insured with Progressive continually will, over time, help you in saving on coverage, as well as bundling different policies or cars with them. For multi-policy discounts, Progressive offers a ton of options to bundle different products, and you can save up to 5 percent on average.
- Driver-based: Usage-based, teen driver, good student, distant student, and homeowner discounts are some of the options in this category. Enrolling in their safe driving program can save you $145 on average.
- Quotes and payments-based: Depending on what options you choose while seeking a quote or making payments, you can get discounts. Getting online quotes, signing online, making full or automatic payments, and opting for paperless documentation can save you money.
– State Farm
To help you make the most savings, State Farm features two discounts on its website — Drive Safe & Save and Steer Clear. Both these options promote safe driving amongst motorists and use telematics technology to track your driving behavior.
Steer Clear is specifically designed for drivers under the age of 25.
Other than those two featured discounts, there are many types of discounts at State Farm.
- Safe Driver: The featured discounts are specifically applied when you enroll in the usage-based programs. However, if you haven’t been in an accident for three continuous years, completed a defensive driving course, haven’t had moving violations, and/or get good grades, you qualify for safe driver discounts.
- Safe Vehicle: Having the latest safety features in your car or owning a new car can get you discounts.
- Loyalty: Choosing State Farm for all the cars in your household or buying a different line of insurance along with car insurance can help you in saving on coverage.
– Are there car insurance discounts for students?
Car insurance for drivers under the age of 25 tends to be significantly expensive — because their inexperience with driving poses a higher risk to insurance providers. Whenever you add a young driver to your policy, your premiums shoot up.
So, what can you do to prevent insurers from raising your premiums exorbitantly?
Firstly, you should inculcate safe driving habits in your children so that they remain accident- and violation-free. Nothing increases rates for young drivers like at-fault accidents or traffic violations.
Secondly, you should be aware of all the discount options that your insurer offers for students. Let’s jump into those.
– Good Student Discounts
Almost all insurers offer discounts if you’re a good student, which usually translates to regularly attending school and getting good grades.
Each insurer has its own criteria for assessing students, but maintaining B-average grades can get you discounts. Students who have other credentials, such as high SAT scores and awards, can get better rates.
– Driver’s Education Program
Completing a driver’s education program doesn’t only ensure you will be more cautious and vigilant on roads but also help you in getting discounted rates from insurers.
Many insurance providers offer their in-house driver training programs, which can be completed online to get discounts.
– Student Away Discounts
When you move to a college/university that is far from your house, you can get discounts on car insurance because you will rarely use the car to drive. Usually, the distance between the home and college should be around 100 miles to get this discount.
– Alumni/University Discounts
Studying in certain universities can help you in saving on car insurance, though not all universities are in the list of insurance providers. But, if you are going to a coveted university, you should ask your insurance provider about discounts.
– Are there car insurance discounts for military personnel?
Most insurance providers offer discounts to members of the U.S. military and their family members. If you’re looking for cheaper rates, you should try getting coverage from USAA, which only offers insurance coverage to the members of the military and veterans.
Insurance providers like Esurance, Geico, Liberty Mutual, Metlife, and Safe Auto offer discounts in the range of 15 – 25 percent to military personnel. You can find one of these following discounts with the insurance providers:
– Military Discount
Whether you’re in active duty or retired from the U.S. Army or the National Guard, you may be eligible for discounts. Your family members can also get discounts on car insurance. Geico offers a military discount of up to 15 percent on your insurance premiums.
– Membership Discount
If you’re part of associations or groups such as the Navy League of the United States or American Society of Military Comptrollers, then you can get discounts from insurance companies.
– Emergency Deployment Discounts
A few insurance companies also offer discounts when active military members are assigned duties in extremely dangerous areas on emergency. Such assignments are ordered by the Department of Defense (DOD).
Ways to Lower Your Auto Insurance Cost
Just knowing about these different types of insurance discounts isn’t enough — you have to ask your agent time and again for any more options or anything new that an insurer has introduced which might lower your rates.
For instance, many auto owners aren’t aware they can get discounts by merely setting up automatic payments for their insurance. You’re going to pay for your auto insurance premium anyway, so why not set up a monthly payment from your bank account or credit/debit card?
So the first rule of buying car insurance is to always ask for all the discount options multiple times.
Let’s look at the other tricks that you can follow to lower your rates as much as possible.
– Seek New Rates Every Year
It might seem like a headache every year to seek a quote, especially when you’re happy with your insurance company, but it can save up a lot of money.
Unless you aren’t bothered about your rates, you should connect with a couple of insurance providers to see what rates and discounts they are offering. Many companies would be happy to get your business from one of their competitors.
Insurers will try to use price as their competitive advantage over other auto insurers.
Promotions are one of the most utilized tools to reduce prices. New customer promotions are quite common; special deals enticing customers to switch without having to wait until the end of their current policy is widely increasing.
Auto insurers competing for your business may also offer discounts for insuring multiple vehicles on one policy, covering students, or discounts for automatic payment withdrawals.
Also, if there has been a major life event, like a marriage or homeownership, which can lower your rates, you should look for a provider that offers big discounts for those specific profiles.
– How do I get a free auto insurance quote?
Every company has a different process, but car insurance quotes are readily available on the Internet. Enter the term “free online car insurance quote” in the search engine you choose. You will find a list of advertisements for insurance.
Most companies will advertise that free quotes are available on their website. Before you start your quote, you need to gather the following pieces of information:
- Name, date of birth, license numbers, and addresses for all drivers
- Driving records for each driver
- Year, make, model of all the vehicles you own
- Limits of liability desired
- Suggested limits of liability for insurance
Just make sure the insurer is legitimate before entering your information. There are, unfortunately, some websites out there that only want to get your personal information so they can spam you.
Called “phishing,” this practice is a violation of your privacy. Check how much information a particular site asks for in order to get a quote.
If they want sensitive information like a bank account number just to get a quote comparison, you may not want to use that website, as it could be a phishing attempt.
After you get your quote on a legitimate website, it’s important to remember that price is not the only factor you should consider.
There is also a customer service side to comparing insurance quotes that you need to keep in mind as well.
As part of your comparison process, be sure to also look for review websites that will give you first-hand accounts of what real customers think of the service provided by each insurance company. Before you sign up with a smaller company, do your research and check with the Better Business Bureau in your state to see if there are any complaints with the company.
You should also choose a company that has been open for at least five years to make sure that the company will continue to stay open while you have a policy there.
Once you have your quote, don’t’ wait too long to compare. A quote is an estimate. In most industries, when you’re getting an estimate to buy a product or have labor performed, the amount that you’re quoted is only guaranteed for a limited period of time.
How long you have to make a decision will be detailed on your estimate.
While some companies will honor the quote that you were given for a few days or a week, most carriers don’t guarantee that the rates will be the same if you don’t apply at that very moment.
This is why it’s important to shop for auto insurance when you’re serious about switching to a new carrier.
– Buy an Old Car
Car insurance rates are specifically high for new and luxurious cars because it’s expensive to repair or replace parts for newer or expensive car models.
If the only thing that matters to you about a car is its ability to take you from point A to B, try buying a no-fuss old car. This way you will not have to spend a fortune on collision or comprehensive insurance.
You might not even need collision or comprehensive insurance if you think that you can get your car repaired at a much cheaper price than what insurance would cost you.
Find out how much it costs to replace your car. If the coverage is more than 10 percent of the value of your car, drop collision and comprehensive coverage. It is not worth insuring a car that is not as valuable. You will pay more for the insurance than to replace it.
– Bundle Your Policies
Most people either have multiple cars in their household or at least have a homeowners or renters insurance. It would help if you have the same insurance provider for all your coverage needs to benefit from bundling discounts.
You might think that buying from the same insurance company would lead to higher costs, but it usually saves you a lot of money. Simply put, if you add your home insurance or any other type of coverage, like boat or Recreational Vehicle, also known as an RV to your current car insurance policy, you can receive as much as 25 percent off your annual premium.
Bundling is an excellent way to capitalize on more than just lower rates too. They help you manage your deductible amounts.
For example, if your homeowner’s insurance deductible has a $2,500 deductible and your vehicle has a $1,000 deductible and you need to file a claim for damages done to both due to an unforeseen event, most insurance companies will only charge one amount.
Of course, it is usually the higher amount, but you can see how this saves you money. If you kept your car insurance separate from your homeowner’s insurance, you would need to pay both deductibles.
Instead of paying $3,500, you are only required to pay $2,500. That is still a good amount of savings, on top of the percentage discount that is applied to your annual premium.
Bundling is also a great way to keep your finances in order. You only receive one bill each month and can make just one payment for both.
In addition, many customers who choose the bundle option tend to stay with their provider for a longer period of time.
If they decide to leave, they must look for a competitor who offers comparable rates, discounts, and deductible options.
By now, you’re aware of the different categories of insurance discounts and can think of something based on your profile that would save you money. Never be shy about asking for discounts from your insurance agents because they’re bound to divulge the information to you.
You can also bookmark this page for future reference whenever you plan to seek a quote on your car insurance or switch over to another insurance company. By the way, you can switch over anytime during the policy period and barring a few companies, you will not be charged a penalty.
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