Can I Get Any Discounts for My Car Insurance?

There are many ways to get a discount on your car insurance, including bundling several vehicles or policies together. The devil is in the details regarding discounts. There are countless ways the insurance companies offer discounts, each making it seem like they are the best thing since sliced bread.

They may offer a substantial discount, which may be “the largest discount in the industry.” But keep in mind, if that company also has the highest costs for insurance, even with the discount, they are still more expensive at the end of the day.

In some situations, adding an additional policy (for example, an umbrella policy) can create a significant enough discount to cause the overall cost to decrease. For example, the annual cost of the home, car, and umbrella could be less than if you only purchased a home and car policy. This article will describe the available discounts and how to evaluate the benefit.

Multi-car Discount

Anytime an insurance company includes more than one vehicle on a policy, you get a discount. This discount can increase the more vehicles you add to the policy. For example, the second car may receive a 5% discount and the third car a 15% discount. Removing a vehicle from a policy will have the opposite effect, so it’s important to remember you can lose discounts.

Multi-policy Discount

Many insurance companies also give you a discount if you buy more than one type of policy. The most common is combining your home and your car insurance. Other examples include adding a second home like a camp, rental, or umbrella liability policy.

Defensive Driver Course Discount

You can often enroll in an online safety course and earn a discount on your car policy. Plan on taking a while as the course is typically six hours of online instruction. This discount is not applied to your entire policy, only to specific portions. This is unique as most discounts apply to the entire policy cost.

For example, this discount will not apply to your comprehensive coverage (if you include this optional coverage, read the article “comp vs. collision” for further details) because that has nothing to do with your driving. It also will not apply to roadside assistance coverage (if you include this optional coverage, read the article “roadside assistance” for further details).

This discount will apply to the following portions of your policy:

  • Property damage – this covers other people’s property for damage you cause
  • Bodily injury liability – provides payment to people who you injured in an accident
  • Collision coverage – damage to your vehicle (if you include this optional coverage in your policy)
  • Personal injury protection – no-fault coverage, also referred to as “PIP”

Even though the discount does not apply to the entire policy, this can still add up and be meaningful. Once you take this course, it can also decrease the points on your license you may have accumulated, reducing your cost even further. Plus, it lasts three years, so you won’t have to retake it every twelve months.

Annual Payments Discount

“I will gladly pay you Tuesday for a hamburger today.” (Google that line if you do not recognize it). Most insurance companies will give you a discount if you pay the entire cost upfront, and one reason for this discount is they do not have to pay staff to collect monthly or quarterly payments.

The other reason is they do not have to worry if you will pay on time. If you pay in one lump sum, they have no concerns about being paid, so they incentivize you to pay early. If your cash flow doesn’t allow for this annual payment, you can still pay each month or quarter. You will likely pay a service charge for this privilege, but it’s an option if needed.

Loyalty Discount

The longer you keep the policy with them, some insurance carriers will give you a discount. This particular discount can come in a few different flavors. One method is a discount on the cost of the policy like the other options discussed in this article.

Another method is reducing your potential deductible each year you do not make a claim. For example, a typical deductible for car policies is $500 per claim, and that deductible may be reduced by $100 per year if no claims are made.

The smallest deductible is often $100, so this reduction will only go so low. See our article “how much deductible should I have?” for further information about that topic.

Good Driver Discount

This discount is sometimes challenging to determine depending on how it gets applied. Every insurance company prefers drivers with no accidents or tickets. The more years without an accident or ticket, the more appealing you are to the insurance company.

Sometimes you will see a discount listed on the policy, that label can vary, but it will show “good driver” status. Other times the discount is baked into the cost of the policy by giving you a lower rate for being a good driver. This method does not spell out the discount, but the cost will be lower than another driver with two speeding tickets.

Vehicle Equipment Discount

Insurance companies love safety features. Does your vehicle have automatic braking if you approach the vehicle in front of you too quickly? What if you’re backing up? How about lane change warning sounds if a vehicle is in your blind spot? Are you equipped with an active alarm system that makes loud noises if someone attempts to steal the vehicle?

Any time a vehicle has a feature that decreases the chances of you making an insurance claim, this helps lower your cost compared to similar vehicles without this feature. The discount amount for each feature will vary by insurance company, so it’s essential to evaluate each quote carefully.

Good Student Discount

Insurance companies figured out a long time ago that students with good grades often have fewer accidents, so they started rewarding these drivers with a discount. Depending on the insurance company, this can include high school and college, and you will need to provide a report card or transcript to document the grades. As a rule of thumb, a “B” average or better will earn the discount.

This discount will often apply to each student on your policy, so use this as an incentive to study a bit more. Besides good grades, this is a wonderful way for parents and guardians to provide a life lesson that studying pays off.

Paperless Document Discount

Electronic communication is becoming more mainstream. But if you prefer receiving paper in the mail, that can usually still happen. A discount is often granted for those willing to go online for statements and bill payments.

Reducing the amount of paper used is good for the planet, and we all favor helping the environment. However, that’s not exactly what motivates the carrier, cutting down on printing and postage does.

However, if you are not someone who likes managing your inbox, you’ll want to think this one through. You’ll have to log-in for policy information and review changes sent through email. If paper works better for you, then maybe pass on this option.

Usage Based Discount

How you use your vehicle on the road can impact your rates if the insurance company factors this into your cost. Some insurance companies have a small piece of equipment you can plug into your car, and others have an app. These are designed to learn about your driving habits.

Do you often speed up quickly, followed by excessive braking? Are you driving less than you used to after changing jobs? Do you idle at traffic lights on your commute or only have two stop signs on your travels? These factors help insurance companies determine if they like your driving pattern.

If they like how you use your vehicle, they may provide a discount. Be careful with this one because this can be a two-way street. Some companies state your rate can only go down, and others tell you they will adjust your cost up or down based on your driving patterns.

If you have a lead-foot (you know who you are), this could work against you. Make sure you ask for the details of this discount before signing up for the tracking feature.

Adding them all up

Of course, even if you qualify for all these discounts, the insurance still won’t be free. However, knowing what’s available can help you make the best choice and reduce your cost. There is no reason to pay the insurance company any more than you have to!

Applying these discounts when quoting your car insurance is a standard practice. We’ll even provide a quote with what the cost would be if you qualified for the discount. That way you can see if it’s worth it for you to take the 6-hour Defensive Driver Course.

To get started, tap the Get Quote button below and one of our friendly insurance pros will get in touch. You can also read our article How To Get Car Insurance to get more information.  If you have other questions you’d like answered first, jot them down below on our Contact Us feature.

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Horan Companies offers comprehensive auto insurance in New York State, including: Baldwinsville, Syracuse, Onondaga County, Liverpool, Fulton and Camillus, NY.