Car Insurance Discounts Worth Asking About

Discounts are one of the few parts of a car insurance price that you can influence quickly, and they are easy to miss. Not every insurer offers every discount, the size of each one varies, and state rules affect what is allowed. Still, it costs nothing to ask. Here are the discounts most commonly available, and what they usually require.

Discounts based on how you drive

• Safe driver or claims-free. Often available if you have gone a set number of years without at-fault accidents, major violations or claims. The required period varies by insurer.
• Defensive driving course. Some states require insurers to offer a discount for completing an approved course, most often for older drivers, and some insurers offer it more broadly. Ask which courses qualify before you enroll.
• Usage-based or telematics programs. These track driving habits such as mileage, hard braking, speed and time of day, through a smartphone app or a device. Safe habits may earn a discount. Ask whether your price can go up as well as down under the program, and what data is collected.
• Low mileage. If you drive less than average, for example because you work from home, you may qualify. Make sure the mileage on your policy is accurate.

Discounts based on your policy

• Multi-policy or bundling. Insuring your car along with your home, condo or renters policy with the same insurer is one of the most widely offered discounts.
• Multi-vehicle. Insuring more than one vehicle on the same policy often lowers the price per vehicle.
• Paid in full. Paying your six-month or annual premium at once, instead of in monthly installments, may earn a discount and avoids installment fees.
• Automatic payments and paperless billing. Some insurers offer small discounts for setting up autopay or receiving documents electronically.
• Early signing or advance quote. Some insurers offer a discount if you buy a policy several days before it starts, rather than on the same day.
• Continuous coverage. Keeping insurance without lapses can lower your price with many insurers.

Discounts based on your vehicle

• Anti-theft devices. Factory-installed alarms, immobilizers and tracking systems may qualify, especially for comprehensive coverage.
• Safety equipment. Airbags, anti-lock brakes, and in some cases newer driver-assistance features may lead to lower rates for certain coverages. Practices vary widely by insurer.
• New vehicle. Some insurers offer a discount for vehicles that are only a few model years old.

Discounts based on who you are

• Professional, employer or alumni groups. Some insurers offer group discounts through employers, professional associations, credit unions or alumni organizations.
• Homeownership. Some insurers offer a discount to homeowners even when the home is insured elsewhere.

How to ask

When you review a quote, look for the list of discounts that were applied. Then ask, in plain words: "Are there any other discounts I might qualify for?" It helps to have a few facts ready:

• Your estimated annual mileage for each vehicle.
• Any other insurance policies you hold.
• Safety and anti-theft features on your vehicles.
• Memberships in professional groups, employers or associations.
• Whether you would prefer to pay in full or set up autopay.

A few cautions

Only claim discounts you actually qualify for. Insurers verify eligibility, and a discount applied in error may be removed later, which can raise your premium in the middle of a term. Some discounts require documentation, such as a course certificate. Discounts also apply to different parts of the premium, so a "10 percent" discount may not reduce your total bill by 10 percent.

Most of all, do not let a discount steer you into coverage that does not fit. A lower price on the wrong coverage is not a saving. Choose the coverage first, then make it as affordable as you can.

The calm view

Discounts reward habits you may already have: driving carefully, keeping coverage continuous, and paying on time. Ask once a year, at renewal, and let the savings come to you.

This Teaching is general information, not legal, tax or financial advice. Coverage rules, requirements and options vary by state and by policy. Always read your policy documents. Car Insurance Buddha is not an insurance carrier, agency, or broker.