Auto Coverage Discounts

Auto Insurance Premium Discounts

Buying insurance is not exciting. Many people buy insurance to meet a statutory, contractual, or loss payee/mortgagee obligation. Even those whose main motivation is to protect their assets want to make sure they’re getting the best value for their premium dollar. Thankfully, there are auto coverage discounts.

Insurance companies are a bit like private colleges. Hardly anyone pays the full tuition amount for a private college, and almost no one pays a premium that hasn’t been discounted.

Insurance agents work hard to make sure the price you pay is the best that your risk attributes qualify you to pay. Insurance companies have a wide variety of opinions as to what constitutes the best “risk” for them to select. Base premiums vary by company, and so do the available discounts.

How discounts are applied also makes a huge difference. Some companies have maximums on the total discount percentage they will allow. Many discounts apply only to certain coverages.  What counts to you is the bottom line number.

Some discounts are mandated by state law, but that doesn’t always mean they’re properly applied.

Discounts can be taken away suddenly if you no longer qualify for them, leaving you with a large increase in premium on renewal. Other discounts might not take effect until you renew or even renew several times. Some discounts are only available if your overall risk characteristics are considered favorble.

Most independent agents use a rate comparison tool, which allows them to show you the premiums for multiple companies with a single entry of information. But, knowledge is power and the following list of discounts might save you some money in your discussions with your agents.

Keep in mind that these discounts are not universal. A company could easily provide the best value for you without allowing only one or two of these discounts, if they’re more generous in what they discount than the other companies.

Bundling Discount

“Bundling” or “Packaging” are the terms used for writing your home insurance and car insurance with one company. Some companies will allow a credit with the promise of adding the other coverage during the policy term. This credit ranges wildly in the industry and can apply to other coverage such as your life, motorcycle, or boat insurance.

Learn more about Bundling Home and Auto Insurance Discounts ›

Safe – Good Driver

If you have a better that average driving record and have had no losses or only a minor loss, you probably will qualify for a safe driver credit.  Depending on your state, insurance companies are allowed to look back three to five years. Some companies will “forgive” losses that are out of your control, such as hail losses or collision when your car was legally parked. Some companies allow you to buy “accident forgiveness” which eliminates the penalty incurred for the first loss after you purchase your policy.

Learn more about Safe Good Driver Auto Insurance Discounts ›

Good Student Discount

Full-time students can qualify for discounted rates if they maintain a B (3.00) or better average. Qualifications vary. Most companies have age restrictions between 16 and 24 for a good student discount. Some require college students to be on Dean’s List. The discount can amount to large savings considering the size of premiums for young drivers.

Learn more about Good Student Auto Insurance Discounts ›

Federal Government

Some companies believe federal government employees are a better class of risk and are willing to discount for them. This is not a widely used discount.

Learn more about Federal Government Discounts


Almost every company offers some form of discount for insuring multiple cars. The logic is inescapable. A person can only drive one car at a time. If a family has several cars, there will be many times they’re all riding in one car. Insurance companies have found that multiple car risks are much less likely to have claims than single car risks.

Learn more about Multi-Car Insurance Discounts ›


Some companies price insurance in direct correlation to the level of education you have received. A college graduate will pay less than a high school graduate. Other companies have coupled this logic with the risk attributes of educators and offer substantial discounts for teachers.

Learn more about Insurance Discounts for Teachers ›


Insurance companies have found that certain military traits result in better loss history. Because of that they allow discounts for members of the military and veterans. This is not something every company does. In fact, some companies are reluctant to insure members of the military. An independent agent can help you find the right company for you.

Learn more about Vet’s Discounts >

Annual Mileage Discount

Some companies offer premium discounts for low annual mileage. The definition of low mileage varies, but usually is between 7,500 and 15,000. On the other hand, some companies will surcharge your premium for driving too little. They believe that your skills deteriorate if you drive too seldom.

Do not misstate your mileage. Companies have a variety of ways of checking. Some companies have contracts with oil lube shops to report mileage to them.

Learn more about Annual Mileage Auto Insurance Discounts ›

Homeownership Discount

In certain states, auto insurance companies will give you a credit for being a homeowner. They feel home ownership indicates a level of personal responsibility that will most often predict safer driving habits.

Learn more about Home Ownership Auto Insurance Discounts ›

Concurrent Life Insurance Discount

Companies who have a life insurance subsidiary or partner company will often give an auto insurance credit if you have a life insurance policy with that company. Often this credit is substantial enough to cover most of the cost of a small term life policy.

Learn more about Concurrent Life Insurance Auto Insurance Discounts ›

Electronic Funds Transfer Discount

Some companies will give a small auto insurance credit for paying your premium through electronic funds transfer. They save accounting cost and pass those savings through to you.

Learn more about Electronic Funds Auto Insurance Discounts ›

Paid in Full Discount

Many companies will discount your annual auto premium if you pay it in full at policy inception. Those companies believe this is an indication of a responsible person who will probably be a safe drive.

Learn more about Paid In Full Auto Insurance Discounts ›

Automatic Restraints 

To qualify for this discount with some companies, your vehicle must come from the factory with an automatic restraint system (airbags or passive seatbelts). Discounts vary depending upon if the restraint is installed on the driver side only or in both front seat locations.

Learn more about discounts for automatic restraints >

Green Car

Insurance companies are willing to provide discounts for Eco-friendly autos.

Learn more about discounts for “green” cars >


You can qualify by insuring a car or truck that has an approved theft limiting system. In certain states, this could be an active of passive car alarm. In others states, it means a vehicle recovery system such as LoJack or OnStar.

Learn more about Anti-theft discounts >

Good Credit

No other discount is potentially as important as good credit. Insurance companies disassemble your credit information to find those personality traits they’ve identified as an indication that you will be a responsible driver. Some will use your raw credit score as a benchmark, but most put your information through an intricate algorithm. It is quite possible for one spouse to have much better credit attributes than the other.

Learn more about Good Credit Auto Insurance Discounts ›

Paperless Discount

Many insurance companies have their policy forms online.  They save money when they don’t have to issue paper and buy postage. Those savings is passed along to you when you elect a paperless relationship.

Learn more about Paperless Auto Insurance Discounts ›

Affinity Group

An affinity group discount is applied when you belong to a group that has been approved by the company. The agent usually receives a slightly reduced commission because the company is marketing to the group for the agent.  For example; one company has an affinity discount for graduates of PAC 12 schools. Another company has a discount for people who bank at a community bank. These affinity plans usually involve a five to ten percent discount.

Learn more about affinity group discounts >

Defensive Driving

Many companies will apply a discount if you have completed a defensive driving course. This discount might only apply if the course has been completed within the last five years.

Learn more about defensive driving course’s discounts >

Senior Citizens

A lot of companies have discounts for senior citizens. They’re usually a bit more responsible and drive fewer miles.

Learn more about senior citizen’s discounts >

Daytime Running Lights

For years, safety experts have known that one of the best ways to avoid accidents during the day is to drive with your lights on. Running lights are automatically turned on and off with your ignition. You will be seen much better, even during the day.

Learn more about daytime running lights discounts >

Anti-Lock Brakes

Anti-lock brakes are a device that allows for better control. They sense when the wheel is going to skid during braking. They automatically apply as much braking pressure as possible without creating a skid. During a hard stop, this allows much better control. Insurance companies know how important this factory-installed device is to loss prevention and will allow a discount.

Learn more about Anti-Lock Brakes Auto Insurance Discounts ›

Customer Loyalty

Insurance companies often will provide a policy premium discount for customers who stay with them for more than a certain period of time. This might increase the longer you stay with them.

Learn more about Customer Loyalty Auto Insurance Discounts ›

Advance Renewal

Many companies believe that customers who made decisions about their placement of insurance far in advance of when they have to. are indicating better than average personal responsibility. They will give a discount for that positive behavior.

Learn more about quoting in advance of renewal discounts >

Other Enhanced Insurance articles related to Car Insurance Premiums:

Do I Need Full Coverage on a Leased Car

Does My Job Affect My Car Insurance Rates?

How Much Car Insurance Do I Need?

How Do I Buy Car Insurance?

Cancellations vs. Non-renewals

Enhanced Insurance is not written by attorneys. If you’re looking for legal advice, you need to contact a lawyer. Further, insurance practices and forms change constantly and are varied from state to state. For definitive answers in your area, contact a local agent.

While the majority of people want an agent involved in their purchase of insurance, many people want to see if they can save money by buying direct from the insurance company. Others want to try a direct quote to make sure the premium they’re now paying through their local agent is fair. If you want a quote for your coverage, click on the competitive quote button on the right side of this page.