Maximize Your Savings with Auto Insurance Discounts

The cost of auto insurance can significantly impact your monthly budget, but there are numerous ways to save. Insurance companies offer a variety of discounts for everything from safe driving to good grades. Here, we’ll explore five types of auto insurance discounts, explain how insurance companies set your rate, and provide additional tips on how you can save. At O1ne Mortgage, we are committed to helping you find the best mortgage services. Call us at 213-732-3074 for any mortgage service needs.

Vehicle-Based Discounts

New car discount: If you drive a new or newer vehicle, you may be eligible for a discount. For instance, Geico reports that new car drivers can enjoy an average savings of 15%.

Anti-theft or safety device discounts: Vehicles equipped with factory-installed safety and anti-theft devices such as anti-lock brakes, airbags, alarms, and tracking systems can earn significant discounts. Esurance notes that such devices can save you between 2% and 25% on certain coverages.

Payment-Related Discounts

Paying your annual premium upfront, enabling automatic payments, or going paperless can also lead to savings. For example, USAA customers who use automatic payments can save up to 3% on their premiums.

Purchase-Related Discounts

Online discount: Shopping for insurance online instead of contacting an insurance agent can save you money. Progressive offers an average discount of 7% for starting your quote online and another 9% for accepting and signing documents online.

Bundling discount: Purchasing multiple policies from one insurer, or bundling, is a popular way to save. Progressive reports that new customers save an average of $1,000 annually by bundling home and auto insurance.

Multi-car discount: Insuring multiple cars with one company typically garners a discount.

Loyalty discount: Many insurance companies offer discounts simply for maintaining continuous coverage through them. However, some states, including Ohio and Maryland, may not allow loyalty to be factored into calculating premiums.

Driving-Based Discounts

Safe driver discount: Good drivers are less likely to file claims, so many companies reduce premiums if you go a certain number of years without accidents or moving violations. At Geico, five years accident-free can earn you discounts of up to 22%.

Driver’s education discounts: Teenagers and seniors may get discounts by taking safe driving classes.

Driver tracking discounts: Using the insurer’s safety apps or in-car devices to monitor your driving can reduce premiums. Nationwide customers using the SmartRide app get 10% off when they sign up and can save up to 40% when their policy renews.

Low mileage discounts: Driving under 10,000 or 12,000 miles a year can lower premiums. Some companies even offer pay-per-mile auto insurance, charging a base premium monthly, plus a charge for each additional mile.

Demographic-Based Discounts

Affiliation discount: Car insurance companies often offer discounts for members of organizations, such as fraternities, alumni associations, employees at certain companies, or military service members. For example, Geico offers qualifying active or retired federal employees up to 12% off.

Homeowner discount: Buying a home demonstrates financial stability that can earn a discount. Progressive offers an average 10% discount even if your home isn’t insured with them.

Senior discount: Many insurance companies discount your insurance at age 55, when drivers tend to be more cautious. (After age 70, premiums generally rise.)

Student discount: High school and college students with good grades can save. State Farm says good grades earn discounts up to 25%. Being away at school and not driving can also get discounts. For example, at State Farm, students under 25 living over 100 miles from home without a vehicle are eligible for a discount.

It’s important to note that insurers may not offer the same discounts in all states. While some discounts are automatically included in your quote, others you’ll have to ask for.

Frequently Asked Questions

What Determines the Cost of Car Insurance?

Several factors determine the cost of car insurance, including your driving record, the type of car you drive, your age, gender, location, and credit score. Insurance companies use these factors to assess the risk of insuring you and set your premium accordingly.

How Can I Save More Money on Car Insurance?

In addition to taking advantage of discounts, you can save money on car insurance by shopping around and comparing quotes from different insurers. Maintaining a good driving record, improving your credit score, and choosing a higher deductible can also help lower your premiums.

Can I Negotiate My Car Insurance Rates?

While you can’t typically negotiate car insurance rates, you can ask your insurer about available discounts and ways to lower your premium. Shopping around and comparing quotes from different insurers can also help you find the best rate.

Can Good Credit Help You Save on Car Insurance?

Yes, having good credit can help you save on car insurance. Many insurers use credit-based insurance scores to assess risk and set premiums. Maintaining a good credit score can result in lower premiums.

The Bottom Line

Beyond seeking out discounts you qualify for, shopping around can help you ensure you’re finding the policy that best meets your coverage needs at the best price. You can use Experian’s auto insurance comparison tool to help you find the lowest rates. At O1ne Mortgage, we are dedicated to providing you with the best mortgage services. Call us at 213-732-3074 for any mortgage service needs.