How to Get a Loyalty Discount

If you and your auto insurance company have a long history together, you might qualify for a loyalty discount. Currently, 12 national providers offer affordable loyalty discount auto insurance to the customers who stick around year after year. While eligibility rules and savings amounts vary from company to company, loyalty discount auto insurance rates are 5% cheaper on average but you might secure cheaper car insurance by comparison shopping online with multiple providers.

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insuranc...

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like and Safeco. He reviews content, ensuring that ex...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Jul 30, 2021

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Things to Remember

  • Currently, 12 national auto insurance companies offer a loyalty discount to customers
  • On average, drivers save 5% on their premiums with this discount
  • To qualify, you must remain with the same provider for years before earning the rate reduction

If you’ve been with the same auto insurance company for several years, you could qualify for a loyalty discount on your auto policy.

Drivers typically save 5% on their annual premiums by earning this auto insurance discount. However, contrary to popular belief, loyalty discounts do not always lead to your lowest car insurance prices.

Sometimes staying with the same company too long can lead to higher rates, primarily if your insurer uses price optimization techniques. Keep reading to learn what companies offer this deal to drivers and discover how to earn your cheapest possible premiums.

After comparing affordable loyalty discount auto insurance rates, enter your ZIP code into our free tool above and shop around for auto insurance quotes from the leading companies near you to see how they compare.

How do I get a loyalty discount on my auto insurance?

Qualification rules for loyalty discounts vary by insurance company. In general, you must remain with the same company for at least one full policy year. However, some companies base your discounted rate on how long you stayed with your previous provider.

You should ask an agent directly about receiving a loyalty rate reduction if you believe you qualify.

While some auto insurance discounts are applied to your policy automatically, sometimes discounts get missed, and loyalty is one of them.

Most times, drivers miss out on savings because this discount goes by many different names. It’s known as a tenure discount from MetLife and Safeco, a persistency discount from Nationwide, and loyalty rewards from Progressive.

Auto insurance laws and regulations also vary from state to state. Therefore, this discount may not be available where you live.

When in doubt, never hesitate to ask an agent or representative for more details about how to earn their company’s loyalty discount.

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What auto insurance companies offer a loyalty discount to drivers?

Currently, 12 national auto insurance companies offer a customer loyalty discount to clients. People save an average of 5% on their annual policies by earning this discount.

Which insurance companies offer loyalty discounts? Check out a complete list below and verify if you already use a loyalty discount auto insurance company:

The loyalty discount on car insurance can take many forms. For example, Safeco only rewards this discount to families with teen drivers listed on the policy. Other providers stack on the savings, like COUNTRY Financial which rewards drivers with better rates after one policy year and accident forgiveness after three years.

The General aims to give you a lower renewal rate at the end of each policy term, but a reduction is not necessarily guaranteed at the time of your renewal due to your age, driving record, or coverage needs.

Local insurers in your region might also provide valued customer discounts to drivers. But keep in mind that not every company is active in every ZIP code. To secure your cheapest rates, compare quotes online from multiple providers in your area and ask about additional auto insurance discounts you might earn.

What is a loyalty discount on auto insurance?

Usually, a loyalty discount provides longtime policyholders with a minor rate reduction based on how long they’ve remained a customer. Typically, the rate reduction is slight, averaging only 5%. This is because the discount is usually easy to passively qualify for.

With some companies, like GEICO, this discount is earned by bundling multiple lines of insurance and is not based on how long you’ve been with a provider.

Ultimately, a loyalty discount is supposed to incentivize customers to stay with the same provider year after year. Your provider offers you a loyalty discount on car insurance rates to entice you not to switch providers.

However, earning this discount doesn’t necessarily guarantee you your lowest prices. You could be paying more for your policy than new customers who use your exact provider.

Sometimes, auto insurance quotes are based on the concept of price optimization. But what exactly does that mean?

Basically, your insurer increases your rate by small increments each year simply because it trusts you won’t switch to a new company. In other words, your insurance company is betting on how much it can increase your premiums at the time of renewal without encouraging you to shop around for new coverage.

This technique helps insurers maximize returns. Usually, the rate hike is around $100 annually, amounting to a $5 to $10 monthly premium increase. Often, customers don’t even realize this rate spike is happening.

According to the Insurance Information Institute (III), there is nothing wrong or inappropriate with using price optimization in the auto insurance industry. Optimizing prices is a longtime practice used in other sectors as well, with little to no controversies.

However, due to variances in local laws and regulations, some states do not use price optimization, including:

  • Alaska
  • California
  • Colorado
  • Connecticut
  • Delaware
  • District of Columbia
  • Florida
  • Indiana
  • Maine
  • Maryland
  • Minnesota
  • Missouri
  • Montana
  • New York
  • Ohio
  • Pennsylvania
  • Rhode Island
  • Vermont
  • Virginia
  • Washington

Price optimization is not the only reason for an auto insurance rates increase. For example, your premiums might go up based on changes to your credit score, driving record, and more.

No matter where you live, comparing auto insurance quotes online from different insurers is the easiest way to secure lower prices.

Every insurance company uses a unique calculation to determine your rates, and those formulas sometimes change. If you use one of the providers listed above and already receive a loyalty discount, consider shopping around for new coverage just in case. A different company might offer you more affordable annual premiums.

Are loyalty discounts a good deal?

For some drivers, loyalty discounts can help lead to your lowest possible rates. It’s possible to earn upwards of 30% off your policy with a loyalty discount, but the average savings is only 5%.

Despite the discount, staying with the same provider for too long can lead to higher than market prices. Your company might use price optimization techniques that negate such a slight reduction to your rates.

Take a look at the total cost of your policy year after year. Did the premium increase significantly even after earning the loyalty discount? If so, it’s time to shop around for new coverage.

To determine if a loyalty discount with your current provider is right for you, use an online quote tool like the one above to shop around for affordable auto insurance quotes from different companies near you.

Shopping around for new coverage shows you what the current market price is and gives you negotiating power. Consider asking your current company to renegotiate your rates before you choose another provider.

Online quote tools should always be free to use, and you should never be obligated to make any purchases when you’re shopping for quotes. When you’re ready, compare your new quotes to your current policy and choose the coverage that works best for you.

If you fear you’re being charged an unfair price, file a complaint with your state insurance department to start an investigation.

How else can you save money on auto insurance?

Fortunately, you can save dozens of different ways on auto insurance besides earning a loyalty discount.

Start stacking your auto insurance discounts to lead to even more significant savings. Other typical auto insurance discounts to ask about include:

  • Multi-policy discounts
  • Multi-car discounts
  • Multi-driver discounts
  • Safe driver discounts
  • Good student discounts
  • Claim free discounts
  • Pay-in-full discounts
  • Low-mileage discounts

You can also keep your costs low by driving a safer or newer vehicle, practicing safe driving techniques, and avoiding any vehicle citations.

While it’s normal for premiums to change at the time of your policy renewal, shopping around for new coverage is sometimes a better way to save than with a loyalty discount.

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Loyalty Discount on Auto Insurance: The Bottom Line

While you might assume longtime customers earn special treatment from their insurance providers, that is not usually the case.

Qualifying for a loyalty discount does not necessarily guarantee you your cheapest auto insurance rates.

Most people secure cheaper auto insurance quotes by shopping around for new coverage than by earning a loyalty discount.

Now that you’ve learned how to buy loyalty discount auto insurance, start comparing quotes from the best providers near you by entering your ZIP code into our free rate tool below.

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Enter your ZIP code below to view companies that have cheap auto insurance rates.

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