Auto insurance is a must-have for drivers. Being covered protects you in the event of a car accident or theft. State laws vary regarding the minimum amount of liability insurance you need.
If you own a vehicle, you will probably want an even better level of coverage than this. You are definitely in the right place if you are worried about affording proper coverage. We can help you find the best car insurance discounts that can save you hundreds of dollars every year.
Getting the best deal on your auto insurance can be a result of scoring the best discounts from your insurer. Auto insurance companies offer many types of discounts based on various factors such as your age, affiliations, policy options and vehicle. Here are a few discount types you will want to ask about before purchasing your first policy or renewing your current one.
Many auto insurance companies give a discount for being a long-time customer or renewing your policy early. If you bundle several types of insurance or insure more than one vehicle on your policy, you may also be eligible for a customer loyalty discount.
Demographic discounts are often available to senior citizens or homeowners because of their perceived lower risk. If you fall below a certain income level, you may also score lower car insurance rates. Even young adult drivers can find discounts by maintaining good grades.
Good drivers nearly always score great discounts by proving that they are not at risk for accidents. In addition, you may be able to find a low-mileage discount.
If your vehicle has certain safety equipment installed, such as anti-lock brakes or an anti-theft system, your insurance company may lower your premiums.
If you’re a new driver, you may be able to find a cheaper policy if you complete an approved driver training course. Current drivers may also be eligible for lowered rates by completing a defensive driving course. If you're at least 55 years old, look specifically for mature driver discount courses in your state.
Choosing to pay your annual premium in full or every six months results in a discount from many insurance companies. If you make your payment monthly, setting up auto-pay could give you a payment discount.
Affiliations with certain companies, educational systems or jobs may put you at the front of the line for a sizable car insurance discount. Examples include discounts for being in the military, attending college or being a part of a travel club.
Compare auto insuranceUnderwriters must analyze several different risk factors in order to calculate your car insurance rate. However, every insurer weighs these factors differently, so it’s important to compare quotes to get the best auto insurance. Some of the most common factors insurers consider in determining your rate are:
Location
Age/gender
Driving experience/record
Credit history
Vehicle type
Vehicle usage
Coverage options
Location. Your state of residency gives you a base rate. The insurance company will start with your ZIP code to determine if you live in an urban area where there is a higher risk of accidents or in a rural area. The company will also consider if your location has notoriously bad weather or carries a higher risk of stolen vehicles.
Age and gender. In general, drivers under the age of 25 must pay higher rates in all but three states because of their higher risk of accidents. In addition, all but six states allow insurance companies to vary their rates based on gender. Female drivers typically score lower rates, especially at very young or older ages.
Driving experience and record. New drivers usually pay higher rates given their lack of experience on the road. The best rates go to those with years of a clean driving history. Keep in mind that it’s not just accidents that you are involved in that affect your rates. Moving violations, such as speeding tickets, can amp up your premium as well.
Credit history. All but three states allow insurance companies to take a look at your credit score to determine your risk for filing claims or committing insurance fraud. Most companies believe that individuals with lower scores are more apt to be high-risk customers.
Vehicle type. Insurance companies will consider the type of car being insured to determine your rate. The insurance company will also weigh how new the car is, how at risk for theft, repairs or accidents it is, and how safe it is to drive. Vehicles with a history of higher claims tend to claim higher rates.
Vehicle usage. The more miles you drive each year, the higher your rates will be.
Coverage options. The type and amount of coverage you choose will greatly affect your overall rates. Your policy may include liability, collision, comprehensive, uninsured motorist and personal injury protection components. In addition, the lower your deductible is, the higher your rate will be.
Here are some of the most popular discounts from the top national auto insurance companies.
AAA
AAA offers up to 20% off on bundled policies and up to 27% off for insuring more than one vehicle with them. They also provide up to a 20% discount for a clean driving record, and up to a 14% discount for students who maintain good grades.
AARP
AARP offers its members who are over age 50 insurance discounts through The Hartford. You can score 12-month rate protection, first-accident forgiveness and a disappearing deductible as a member. You may also get a discount for completing the AARP Smart Driver safety course.
State Farm
State Farm offers several customer loyalty discounts, including up to 20% off for multiple cars insured through them and up to 17% off for bundling multiple types of insurance. In addition, young drivers can score up to 25% in savings if they keep up good grades in college.
Allstate
Allstate offers up to 35% off for five years of safe driving. They also give up to 35% off for college students who are attending college car-free and whose home is at least 100 miles from their college.
MetLife
MetLife offers a 7% discount for completing a driver safety course and up to a 12% discount if all household drivers have a clean record. They also provide a 20% discount for five or more years of safe driving.
Liberty Mutual
Liberty Mutual offers up to a 10% discount for bundling different insurance types with them and an additional 10% discount for insuring more than one vehicle with them. They also offer good student discounts.
GEICO
Often billed as one of the best discount auto insurance options, GEICO gives up to 26% off for five years of safe driving, up to 25% off for bundling auto insurance on more than one vehicle with them, and up to 15% off as an active or retired member of the military.
Did you know that insurance companies aren’t the only ones offering great discounts on your car insurance?
Warehouse club Costco offers great insurance rates to its members; each policy is underwritten by American Family Insurance. Costco states that their members save an average of more than $500 in the first year alone when they switch. They also offer additional discounts for safe drivers who want to bundle insurance or insure more than one vehicle with them. In addition, they provide roadside assistance.
Ask your human resources department whether your employer provides insurance discounts at a group rate. For example, Berkshire Hathaway company employees are eligible for a discount through Geico. Liberty Mutual offers a discount to UPS employees, and Federal employees can get discounts through USAA.Individuals working in certain professions can also get small discounts from some insurance companies that add up to big savings over time. Certain professionals are seen as being low-risk drivers. Be sure to look into this if you are in one of the following professions:
Law enforcement
Firefighting
Teaching
Medicine
Engineering
Farming
If you have maxed out all of the possible auto insurance discounts that are available to you, there are a few more ways to reduce your insurance bill.
Look into keeping all of your insurance policies with one company. Nearly all companies provide some type of discount for bundling. If you carry homeowners, renter’s or even life insurance policies, bundling is the easiest way to create a budget-friendly premium. An added benefit of bundling is how easy it will be to pay your policies each month.
If you are considering purchasing a new car, do a quick online search of which vehicles are cheapest to insure. You will want to purchase one that typically requires few repairs and that has a history of few accidents and thefts. You may even want to consider purchasing a vehicle model that is a few years old to reduce your premium significantly.
If your auto insurance is still not affordable enough for your budget, consider increasing your deductible. The deductible is the amount that you must pay out-of-pocket if you are in an accident or make a claim. By agreeing to pay more yourself, your savings could be significant. You may also want to look into lowering your coverage on certain parts of your policy or getting rid of your collision or comprehensive insurance completely, particularly if you drive a very old model that would be quite cheap to replace.
Although scoring the best insurance discounts for your vehicle may seem as if it takes a lot of work, don’t give up after your first try. Comparing quotes from multiple providers could save you hundreds of dollars each year.
Even if you are currently satisfied with your auto insurance provider, don’t underestimate the discounts that you could get from switching. In fact, experts recommend checking out your auto insurance policy every 6 to 12 months to ensure that it includes the coverage you need and the discounts that you should be enjoying.
If you do find a better discount at a new company, consider mentioning it to your current company before you switch. Your current company may match that discount or give you a better deal just to keep you as a customer.
In addition, be sure to look beyond nationwide insurers to smaller insurance companies that may only operate in certain regions of the country or only in your state. Not only may a smaller company offer you a better rate, but also you may be able to enjoy more personalized customer service.
While shopping for discount auto insurance may not be fun, it can result in a great payoff that can save you a ton of money. Compare auto insurance rates at Squeeze.com!