How to get discounts on car insurance
- Planning ahead
- Auto insurance
Car insurance offers protection in the event of accidents, theft or unforeseen circumstances, so that you and your vehicle are covered when you need it most. We can all see the value in it, but car insurance can be a significant expense. This is where discounts come into play. Discounts vary from one insurance provider to another, and eligibility criteria may differ, they all have one thing in common: if you know how to get discounts on car insurance, and you qualify, you can significantly reduce your insurance premiums.
At its core, a car insurance discount is a financial incentive offered by an insurance provider to encourage specific behaviors that correlate with reduced risk – less risk for the insurer should translate to lower costs for you. Discounts are a reward for responsible behavior, not for accepting substandard coverage. Let’s look at what discounts are available and how you can use them to save on your insurance costs.
Types of car insurance discounts
You likely already qualify for some common discounts, or could with a little bit of time and effort. We'll explore some of the most common car insurance discounts, how to qualify for them and the potential savings of each.
Safe driving discounts
Safe driving discounts are among the most accessible discounts. Insurance companies appreciate drivers who prioritize safety on the road, as they are statistically less likely to file claims.
- Qualification – To earn safe driving discounts, you need to maintain a clean driving record, which typically means avoiding accidents and traffic violations. Insurance providers often look at your driving history over the past three to five years or use telematics data.
- Potential savings – The savings can be substantial. Most insurance companies will give you a 10-20% discount for using a telematics system. If your insurer likes what it records, you may even qualify for a larger discount based on your driving habits. Even bad drivers stand to benefit – most carriers will let you keep that 10-20% discount for your first policy term, no matter what the data reveals about the way you drive.
Vehicle safety features discounts
Modern vehicles are equipped with an array of advanced safety features designed to protect drivers and passengers by reducing the likelihood of accidents and the severity when they do occur. These features include things like anti-lock brakes, airbags, lane departure warnings, adaptive cruise control and blind spot monitoring. Insurance providers recognize the safety benefits of these features and often offer discounts to policyholders who have them installed.
- Qualification – Qualifying for vehicle safety features discounts is straightforward. You typically need to have one or more of these safety features installed in your car. Most new vehicles come equipped with these features and retrofitting older cars is often possible.
- Potential savings – The amount you can save varies depending on the number and type of safety features in your vehicle. On average, you can expect to save between 5% to 15% on your premium.
Bundling multiple insurance policies with the same provider, such as combining your car insurance with home or renters insurance, can lead to substantial discounts. This approach not only simplifies your insurance management but also brings financial benefits.
- Qualification – To qualify for multi-policy discounts, you need to purchase multiple insurance policies from the same provider. This might include auto, home, renters or even umbrella insurance. Check with your insurance company or the VIU by HUB Advisory Team to see which policies are eligible for bundling.
- Potential savings – Multi-policy discounts can vary, but they often range from 10% to 25% on each policy.
Good student discounts
For students, maintaining good academic records can translate into savings on car insurance. Insurers believe that students who excel academically are more likely to exhibit responsible behavior in other areas, including driving. By demonstrating good judgment and discipline in their studies, students are considered lower risks.
- Qualification – Good student discounts typically require students to maintain a specified grade point average (GPA). Eligibility varies by insurer, but a GPA of 3.0 or higher is a common requirement.
- Potential savings – Discounts can vary, but they generally range from 10% to 25% off your premium.
Defensive driving course discounts
Defensive driving courses provide valuable insights and techniques for safe driving. They cover topics like defensive driving strategies, accident avoidance and handling emergencies on the road. Completing a defensive driving course can improve your driving skills and qualify you for a discount on your car insurance. These courses are beneficial for drivers of all ages.
- Qualification – To qualify for defensive driving course discounts, you'll need to successfully complete an accredited course. These courses are widely available, both in-person and online, and typically take a few hours to complete.
- Potential savings – The savings from defensive driving course discounts can vary, but they often range from 5% to 15% off your premium.
Low mileage discounts
Insurance companies believe that the less you drive, the lower your risk of being involved in an accident. This can translate into savings if you show that you drive less than the average person. Insurance providers often have thresholds that classify drivers as low-mileage drivers, typically around 7,500 to 15,000 miles per year. Reducing the number of miles that you drive can lead to lower insurance premiums. This discount is especially relevant in today's world of remote work and increased public transportation options.
- Qualification – To qualify for a low mileage discount, you need to demonstrate that you drive significantly fewer miles than the average driver. This can be verified through odometer readings or usage-based insurance programs.
- Potential savings – Low mileage discounts can range from 10% to 30%.
Age can significantly impact car insurance premiums, and age-based discounts are designed to reflect this. Drivers of all ages can benefit from age-specific discounts.
- Qualification – For seniors, eligibility may depend on age and retirement status.
- Potential savings – The savings from age-based discounts vary based on age and insurance company.
How to maximize car insurance discounts
Maximizing car insurance discounts requires a strategic approach. There are some things you can do to make the most of the discount opportunities available.
- Regular policy reviews – Your insurance needs can change over time. Regularly reviewing your car insurance policy can uncover new discount opportunities and keep your coverage aligned with your evolving needs. We recommend that you review whenever you make a change – adding a teen driver, reducing the number of miles you drive, buying a new car – and at every policy renewal time.
- Comparison shopping – This is a powerful tool for finding the best insurance rates and maximizing your potential savings. Insurance premiums and available discounts can vary significantly among insurers. To get the best deal, you should compare quotes from different providers regularly. Online tools and brokers make comparison shopping more accessible than ever. At VIU by HUB, you enter your information once and get quotes from many carriers, simplifying the work of finding those quotes yourself.
- Ask about less common discounts – While many common car insurance discounts are widely advertised, there are less common, specialized discounts that you might qualify for. Don't hesitate to ask your insurer about discount opportunities. Working with a broker makes this easy – you can tell an agent about your life and they will know which carriers may offer discounts based on what you tell them. Don’t assume that discounts are advertised or that every carrier offers the same discount types or amounts.
- Bundle multiple policies – Insurers often incentivize policyholders to consolidate their coverage under one roof by offering multi-policy discounts. To bundle policies, start by contacting your current insurance carrier to find out if they offer the coverage you need and multi-policy discounts. Your insurance company can tell you what the next steps are.
- Maintain a good credit score – Your credit score plays a role in determining your car insurance premiums because insurers use scores as a risk assessment tool. Maintaining a healthy credit score can lead to lower insurance costs over the long term. To improve or maintain a good credit score, focus on responsible financial behavior. Pay bills on time, avoid carrying high credit card balances and regularly review your credit report for accuracy.
Enjoy the ride with the right auto insurance
Debunking myths about car insurance discounts
There are a lot of misconceptions surrounding car insurance discounts, which can be a source of confusion for many policyholders. We’ll look at some of the most common here, but you can always reach out to your agent or the VIU by HUB Advisory Team for more information about these, or any other questions you may have.
Myth 1: Discounts mean reduced coverage quality
One prevailing myth is that accepting car insurance discounts means sacrificing the quality of your coverage. This is simply not the case. Discounts are incentives offered by insurance companies to encourage responsible behavior, not indicators of reduced coverage. For example, a safe driver discount is granted to those who have maintained a clean driving record and shown their commitment to safe driving practices. This discount doesn't diminish the coverage; it simply reduces the cost of that coverage as a reward for lowering the insurance company’s financial risk.
Myth 2: Discounts are only for "basic" policies
Some may mistakenly believe that discounts are only available for the most basic, bare-bones insurance policies. This leads to people not seeking discounts out of fear of wasting their time on something that they won’t qualify for. However, car insurance discounts are available for a wide range of policies, from basic liability coverage to comprehensive and collision policies.
Myth 3: Discounts are temporary
There's a perception that car insurance discounts are temporary promotions that will go away after a short time. While some discounts may have expiration dates, many are ongoing and can be maintained as long as you continue to meet the eligibility criteria. Safe driving discounts, for instance, are typically available as long as you maintain a clean driving record. Loyalty discounts can also be long-lasting and even get better as time goes on.
Myth 4: Discounts are too small to matter
Our last myth is that car insurance discounts are insignificant, providing only minor reductions in premiums that aren't worth the effort of pursuing. It’s true that some individual discounts may seem small, but they can add up significantly over time. For example, a 10% discount on an annual premium of $1,200 results in savings of $120 per year. When combined with other discounts, such as bundling or good student discounts, the cumulative savings can be substantial.
Frequently asked questions about car insurance discounts
We've compiled a list of common questions about car insurance discounts to help you quickly find the answers you’re looking for. These questions are addressed in more detail throughout the post, so if you need more information, scroll through the post or talk to a VIU by HUB Advisor.
- What are car insurance discounts, and why do insurance companies offer them?
Car insurance discounts are reductions in your insurance premiums based on specific group affiliations, factors or behaviors that make drivers a lower risk. Insurance companies offer these discounts as incentives to encourage behavior they like to see, including responsible driving, policy bundling and other behaviors that decrease their exposure to claims. Discounts benefit both drivers and insurers by promoting safer roads and more affordable coverage.
- How do I qualify for car insurance discounts?
Qualifications for discounts vary, but often involve specific criteria or behaviors. For instance, to qualify for a safe driving discount, you generally need to maintain a clean driving record without accidents or violations. Multi-policy discounts typically require bundling multiple policies with the same insurer. Review the eligibility criteria for each discount with your insurance provider.
- How much can I save with car insurance discounts?
Savings can vary widely, depending on factors like the type of discount, your insurer, how many discounts you qualify for and your policy. To know even an estimate of your savings, you’d need to consult with your carrier and those that you’re considering transferring your policy to.
- Do discounts affect the quality or coverage of my policy?
No, car insurance discounts do not affect the quality or coverage of your policy. Discounts are rewards for responsible behavior and cost-saving measures. They are applied to the premium you pay, reducing the overall cost while keeping the same level of coverage intact. They do not change your coverage in any way.
- How can I apply for car insurance discounts?
Applying for car insurance discounts typically involves discussing your eligibility with your insurance carrier or agent. Start by contacting them to ask about available discounts. You may need to provide documentation or evidence to prove your eligibility, such as a clean driving record or proof of membership in a certain group.
- Can I combine multiple discounts for greater savings?
Yes, in many cases, you can combine multiple discounts to maximize your savings. For example, you might bundle your policies to get a multi-policy discount and then also qualify for a good student discount for your teen. Combining discounts can lead to even greater reductions in your premiums.
- Are there any less common or more specialized discounts I should be aware of?
Yes, there are less common and more specialized discounts that you might qualify for, depending on your circumstances. Some insurers offer discounts for electric or hybrid vehicles, military personnel, federal employees, or even professional associations. These discounts might not always be prominently advertised, so it's a good idea to ask your insurer about them.
- Do car insurance discounts have expiration dates?
While some discounts may have expiration dates or renewal requirements, many are ongoing and can be maintained as long as you continue to meet the eligibility criteria. Safe driving discounts, for instance, are typically available if you maintain a clean driving record. Loyalty discounts can also last a long time and reward customers for their continued business.
- What if I don't qualify for any discounts?
If you don't initially qualify for any discounts, you should continue to practice responsible driving habits, maintain a clean driving record and work to improve your credit score. You can also consider association and organizations that you qualify for. The associated car insurance discount may be greater than the membership fees, if any. Over time, you may become eligible for discounts. Additionally, regularly compare insurance quotes from different providers to find the most competitive rates, as discounts can vary between insurers and new discounts may be added without much fanfare.
- Can I lose my discounts if my circumstances change?
Yes, some discounts may be affected if your circumstances change. For instance, if you no longer meet the criteria for a safe driving discount due to an accident or violation, you might lose that discount. You’ll lose loyalty discounts if you change carriers (though that doesn’t mean you should stay with the same carrier for life). And good student discounts go away when you’re no longer a student or when grades slip. It's essential to review your policy regularly and discuss any changes with your insurer to be sure you're still eligible for your discounts as well as look for new ones.
In the world of car insurance, discounts are like hidden treasures waiting to be discovered. They offer you the opportunity to reduce your insurance premiums without sacrificing the quality of your coverage. Unfortunately, like hidden treasure, you may have to do some digging to find the ones that work for you. Having someone like a VIU by HUB Advisor on your side makes the process much easier and greatly reduces the chances of you missing out.
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