Insurance discounts vary depending on state laws, individual company guidelines, and how each company calculates insurance rates. Each company has its own criteria, requirements, and the savings vary between companies and location.
The discounts you are currently receiving are generally easy to see by looking at the declarations of your policy. Not all discounts are available in all areas, or with any company.
Most insurance companies offer several discounts, but may limit the total available discount to a percentage off your full premium. Generally, they allow up to a 25 percent discount off your premium.
DETERMINING YOUR INSURANCE RATES
Several discounts are often automatically factored in to the way the insurance company determines your insurance rates, and you may not even realize you are receiving a discount based on basic information you provide to your insurance company.
- First, your car insurance company determines your base rate based on basic information such as your ZIP code, age, driving record and type of car you drive.
- Second, the insurance company will look at your driving record and other past insurance information; this provides additional information that shows whether you pose a significant risk. Safe driving records and a low history of claims shows you pose less risk and will result in lower rates.
- Next, personal information and lifestyle habits are taken into account that further estimate your risk rates and may lower your base rate premium.
The discounts outlined below are often taken into account while determining your insurance rates. If any of these factors change, it is important to notify your insurance company so you can be eligible for any and all discounts available to you.
YOUNG DRIVER DISCOUNTS
Good Student Discount - Semi-annual report cards could be worth big bucks. For parents with teenage drivers, the good student discount is priceless. An average B student can save their parents up to 20% on their insurance premium.
Teen Contract Discount - Teenagers who commit to certain terms and rules of driving may be eligible for a discount on their premium.
College Student Discount - Parents who have a full-time college student under the age of 25 living away from home may receive a premium discount
LOYALTY AND POLICY DISCOUNTS
Long Term Customer Discount - If you have been with the same company for years, ask them what rewards they offer for loyal customers.
Multi-Car Discount - A discount of 10 to 25 percent may be available when you insure more than one vehicle on the same auto policy.
Multi-Policy Discount - Maintaining more than one policy with the same company can bring substantial discounts on each policy. This is known as bundling policies.
Renewal Discount - Some companies offer a discount to those who automatically renew their policy year after year.
Pay In Full Discount - If you choose to pay your entire yearly premium upfront, you may be eligible for a pay in full discount.
Paperless Discount - Creating an online account and making your payment online may save you on your premiums.
LIFE AND CREDIT DISCOUNTS
Mature Driver Discounts - Embrace aging, and enjoy an insurance discount. With a clean driving record, drivers over 55 may qualify for additional discounts.
Lifestyle Discounts - Some companies may offer lifestyle discounts for drivers who stay 100 percent alcohol and tobacco free.
Homeowner Discount - Some insurers offer a discount for owning a home.
Marital Status - Some companies actually offer lower rates to individuals and couples who are married.
Credit Score Discount - A good credit score, typically 700 or better, gives you a lower risk rating, which lowers your rates. Not all states use the credit score as a factor in determining insurance rates.
SAFETY DISCOUNTS
Safety Discounts - Many insurance companies will offer discounts for cars that have special safety features such as extended airbags, anti-theft devices, backup assist, and other safety equipment.
Accident-Free Discount - Maintaining a clean record meaning no at-fault accidents for three or more years often qualifies for significant discounts.
Claim-Free Discount - Drivers who do not file claims over a period of three to five years are viewed as low risk and may receive deep discounts.
Safe Habits Discount - If you opt to have a monitoring device in your vehicle, you may be able to enjoy additional rewards based on safe driving.
Anti-Theft Discount - If you install an anti-theft device, alarm system, or vehicle recovery system, it may prove beneficial to your premium.
VIN Etching - Etching your VIN number on the windshield and each windows wins you a discount of between 5 to 15 percent.
DRIVER AND VEHICLE DISCOUNTS
Defensive Driving Course Discounts - Ask about discounts offered for completing a defensive driving class. In some areas, one class can give you many years of a reduced price.
Vehicle Discounts - Some companies offer discounts for economy cars, or discounts for hybrids and other fuel-efficient vehicles. If you drive a truck or participate in farm work, there are additional discounts available.
New Car - New cars may change your insurance costs up or down, if you choose a brand new car, it may come with an insurance discount of up to 10 percent.
Good Driver Discount - Keeping a clean record is worth big bucks for drivers who avoid accidents or tickets for three years or more.
Low Mileage Discount - For drivers who travel significantly less than the average, typically less than 10,000 miles per year, are eligible for a discount of 5 to 15 percent.
EDUCATION AND PROFESSIONAL DISCOUNTS
Organization Discounts - Are you an alumnus, member of the bar, a teacher, or clergy? Many organizations and some corporations offer professional discounts exclusive to members.
Education Discounts - Drivers who have a college degree may be eligible for additional discounts.
Professional Discounts - Individuals in certain professions are viewed as lower risk, and may receive a discount. These professionals are generally scientists, engineers, and teachers. Other companies offer preferred discounts to police, fire, and medical professionals.
Military Discounts - This is a very common discount offered to members of the military and their immediate family.
Federal Employee - Some companies may offer a discount to those who are employed by the federal government.
By Matt Reynolds - Google+