The Biggest Car Insurance Discounts

A survey of the ten largest auto insurers reveals some surprising breaks.

You always tell people to take advantage of discounts that can lower their car insurance premiums. What are some of the most common ones?

The discounts can vary a lot by company and state. just surveyed the ten largest auto insurance companies about their discounts, and some of the breaks are surprising. See Who Offers the Most Car Insurance Discounts? for the survey results. Ask about available discounts when you’re shopping around for coverage or if you’re planning to buy a new car. And let your insurer or agent know when you have a life change, such as getting married or moving to a new neighborhood or city. A change may lower your premiums. (Get auto insurance quotes.)

You’ll generally get a discount if your auto and homeowners or renters insurance is with the same company, and you may get an additional discount on all of your policies for adding umbrella coverage. Most -- but not all -- insurers give you a discount for insuring more than one car or for remaining accident-free for a certain number of years (Geico offers a discount of up to 26% for five years without an accident).

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Most insurers also give a discount for having certain kinds of anti-theft devices (such as car alarms, ignition cutoff switches or VIN etchings), anti-lock brakes and special safety features, such as motorized seat belts. A few insurers, including Farmers and Travelers, offer discounts for hybrids or alternative-fuel vehicles. You usually get a discount for low mileage, and you may get an even bigger one for installing data-tracking technology; discounts range from 10% to 30% for installing a tool that tracks the time of day you drive, your mileage, and acceleration and braking rates. See Data-Tracking Technology Can Help Lower Your Car Insurance for details.

You may get a break for taking a defensive driver course (although some insurers offer these discounts only to senior drivers or teenagers). If your child is a full-time student, maintaining at least a B average in high school or college, a discount of about 15% is typical. Most insurers give you a discount if your child moves more than 100 miles away from home for college and doesn’t take a car, but the insurer will still provide coverage while your child is home for vacations. See 8 Ways to Cut Insurance Costs for Teen Drivers for more information.

Your occupation can make a difference. Several insurers offer discounts for members of the military, and some have special breaks for certain jobs (such as teachers) or members of certain groups (such as alumni associations). And the way you pay can make a difference: Most of the insurers surveyed offer a discount for paying your premium in a lump sum rather than monthly, and for paperless billing and automatic payments.

For more information about saving money on car insurance, see 4 Reasons to Reshop Your Auto Insurance, The Best Sites to Save on Auto Insurance and How to Get Accurate Car Insurance Quotes.

Kimberly Lankford
Contributing Editor, Kiplinger's Personal Finance

As the "Ask Kim" columnist for Kiplinger's Personal Finance, Lankford receives hundreds of personal finance questions from readers every month. She is the author of Rescue Your Financial Life (McGraw-Hill, 2003), The Insurance Maze: How You Can Save Money on Insurance -- and Still Get the Coverage You Need (Kaplan, 2006), Kiplinger's Ask Kim for Money Smart Solutions (Kaplan, 2007) and The Kiplinger/BBB Personal Finance Guide for Military Families. She is frequently featured as a financial expert on television and radio, including NBC's Today Show, CNN, CNBC and National Public Radio.