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Purchasing car insurance can be a big expense, with rates varying widely depending on your location, driving history, age, gender, and other factors. While it’s common knowledge that maintaining a clean driving record and good credit score can lower your premiums, there are many overlooked hidden car insurance discounts that drivers can take advantage of.
In this comprehensive guide, we’ll uncover 35 hidden car insurance discounts that can save you hundreds of dollars per year on your premiums. We’ve ranked these hidden savings opportunities from ones that offer the highest potential savings to the least.
List of Hidden Car Insurance Discounts That You Can’t Overlook
1. Pay Annually
The most straightforward way to lower your car insurance premiums is to pay for your entire 6-month or 12-month policy all at once. Almost all insurers offer an upfront payment discount of 5% to 10% compared to paying your premium monthly or quarterly. This discount is sometimes called a “pay in full” or “single pay” discount.
Even when buy now pay later car insurance may sound tempting, paying annually avoids installment fees that can increase the overall cost over time. It also rewards insurers with a guaranteed full year of premiums upfront, allowing them to earn interest on those funds. For a policy that costs $1,200 per year, choosing annual payments could save you $60 to $120.
2. Bundle Home and Auto Coverage
If you purchase both home and auto insurance from the same provider, bundling your policies can lead to discounts of up to 30% off your total premiums. Auto and home insurance companies incentivize bundling by offering multi-policy discounts to reward customer loyalty and simplify billing.
The amount of savings will depend on your insurer, but bundling can yield substantial savings of hundreds of dollars per year. It also streamlines managing multiple policies through a single insurer. Just make sure to compare bundled quotes to standalone policies to ensure the discount truly offers the best rate.
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3. Take a Defensive Driving Course
Completing an approved defensive driving course can reward you with discounts on car insurance premiums for up to 3 years. Defensive driving classes teach accident avoidance techniques and safety strategies to reduce your risk profile as a driver.
Insurers offer defensive driving discounts because statistically, course graduates file fewer claims. Defensive driving alumni can save 5% to 15% on premiums. Courses cost around $25 to $75 and can often be completed online within a few hours.
4. Increase Your Deductible
Deductibles represent what you pay out of pocket for a claim before your insurance covers the remaining balance. The higher your deductible amount, the lower your monthly premiums will be.
Increasing your deductible from $500 to $1,000 can reduce premiums by up to 25% while bumping it up to $2,500 can save you 40% or more. Just be sure you have enough savings to cover the higher deductible in the event of a claim. This strategy shifts more upfront costs to you from the insurer.
5. Enroll in Usage-Based Insurance
Usage-based programs use a telematics device or mobile app to track your driving habits – like speeding, rapid acceleration, hard braking, and phone usage. Safe driving earns you discounts, while risky behaviors increase premiums.
Usage-based insurance can lead to discounts of 20% to 40% for the safest drivers. However, it may take several months of monitored driving to earn the maximum savings. With usage-based auto insurance, you will have the power to control your insurance costs based on your actual driving.
6. Choose a Vehicle with Advanced Safety Features
Modern vehicles equipped with advanced driver assistance technology, like automatic emergency braking and forward collision warning, qualify for insurance discounts.
Features that prevent accidents lead to lower risk, translating to discounts of 5% to 30%.
Ask your insurer about eligible high-tech safety features that can earn premium reductions. Leasing or purchasing a vehicle loaded with accident avoidance tech can provide long-term insurance savings.
7. Take Public Transportation to Work
Commuting to work by public transit rather than driving your personal vehicle can earn you a low mileage discount. Insurers offer lower rates for drivers who keep their annual mileage under a specified threshold, like 5,000 to 10,000 miles.
Taking the bus or subway to work every day can keep your mileage low enough to qualify for discounts of 5% to 15%. Record your odometer reading regularly to confirm you stay within the mileage limit.
8. Become a Member of Certain Organizations
Occupational, educational, and affinity group memberships could make you eligible for an insurance discount. Alumni associations, automotive clubs like AAA, educator organizations, and large employers frequently partner with insurers to offer group savings.
Ask about discounts through any organizations you belong to. While the savings are modest – usually 5% to 10% – discounts through multiple groups can add up.
9. Install an Anti-Theft Device
Having advanced anti-theft technology installed in your vehicle, like a car alarm, tracking system, or immobilizer, can earn you a break on premiums. Your insurer may offer discounts of 15% or more for audible alarms, 5% for passive devices like etching your VIN on windows, and up to 25% for stolen vehicle recovery systems.
Before choosing an anti-theft device, verify it qualifies for a discount with your insurer. Your locality may also offer reduced rates or tax benefits for installing theft deterrents in your vehicle.
10. Choose OEM Parts for Repairs
Opting for the original manufacturer’s parts when repairing collision damage or filing a claim is one of the commonly hidden car insurance discounts. Some companies offer this incentive because OEM parts better maintain a vehicle’s value.
Make sure to ask your insurer if they provide a discount for using original factory parts. The savings usually amount to 5%, with higher discounts possible for expensive luxury or performance vehicles.
11. Take a Certified Safe Driver Course
Insurers reward drivers who complete a certified safe driver course and give a nice discount of 10% and more. You can also save on auto insurance by completing traffic school. Improving your driving skills and knowledge reduces claims risk from at-fault accidents.
Discounts range from 10% to 20% for approved courses. Taking an online traffic course can be completed in a few hours and potentially provide 3 years of insurance savings.
12. Buy Your Homeowners and Auto Insurance from the Same Provider
We’ve already discussed bundling home and auto coverage, but buying both from the same insurer can also trigger additional discounts beyond the basic bundling savings. Companies offer further incentives of 5% to 20% to keep your business for multiple policies.
If you already bundle through one insurer, check with others to see if they can beat your rate with their multi-product discounts. Comparison shopping ensures you capitalize on maximum savings.
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13. Enroll in Paperless Billing and Automatic Payments
Going paperless by signing up for online statements and enabling auto-pay from your bank account provides convenience while lowering administrative costs for insurers. In return, most offer discounts of around 5% for enrolling in both options.
Paperless billing also has environmental benefits along with modest insurance savings. Just monitor your monthly statements electronically to avoid overpayments or billing discrepancies.
14. Take Advantage of Low Mileage Discounts
Similar to using public transportation, maintaining low annual mileage on your vehicle can earn you a sizable discount. Most insurers offer break points at around 5,000, 8,000 or 10,000 miles per year. Verify your carrier’s thresholds to stay under the limit.
The more you drive, the higher your risk of being involved in an accident. Less mileage means lower risk, and insurers pass those savings along through discounted premiums of up to 25% off.
15. Buy a Safe Vehicle
Driving a vehicle with top safety ratings can earn you discounts with many auto insurance providers. Insurers classify vehicles into safety rating tiers based on crash test results, with top-tier vehicles eligible for the largest discounts.
Look for vehicles with excellent scores from the Insurance Institute for Highway Safety (IIHS) and the National Highway Traffic Safety Administration (NHTSA) to unlock discounts of 10% or more.
16. Take a Motorcycle Safety Course
Similar to defensive driving classes, completing an approved motorcycle safety course can reduce your premiums by up to 15% on motorcycle insurance.
Riding a motorcycle is inherently riskier than driving a car, so advanced training helps reduce accidents.
Courses teach critical skills for operating your motorcycle safely amid traffic. Many states even waive the road skills test for your motorcycle license if you pass a basic rider course.
17. Insure Multiple Vehicles on One Policy
If you insure more than one vehicle through the same provider, most will offer a multi-car discount of up to 25%. Adding family members living together to your existing policy also falls under this discount.
Multi-vehicle policies simplify billing and allow insurers to earn more business from a single household. Make sure to compare bundled quotes to individual policies to verify the discount offers meaningful savings.
18. Take Advantage of Good Student Discounts
Maintaining excellent grades in high school or college can earn you a good student discount on car insurance. Most insurers offer this discount for students with a 3.0 GPA or higher. Discounts range from 5% to 20% off your premium.
Good students tend to exhibit responsible behavior, including safer driving habits. Insurers reward that decreased risk with reduced rates. Just provide your report card or transcript as proof of qualifications.
19. Reduce Your Coverage Limits
Cutting back on certain coverage limits offers opportunities to reduce premiums, but this tactic requires careful consideration. Lower property damage liability limits offer modest savings, though many experts recommend carrying at least $100,000.
If you drive an older vehicle, dropping collision and comprehensive coverage (not legally required) could reduce your rates substantially. Just hang onto this coverage if your vehicle has significant value.
20. Buy a Vehicle with a Lower Price Tag
The value of your vehicle plays a role in determining your insurance rates. Physical damage coverages like collision and comprehensive have higher premiums for more expensive vehicles.
Choosing an inexpensive vehicle may be considered a hidden car insurance discount and can substantially cut these premiums, especially on a vehicle with a value under $5,000. Liability coverages may also decrease for less costly vehicles.
21. Ask About Loyalty Discounts
After being continually insured with the same provider for several consecutive years, you may qualify for a loyalty discount. This rewards long-term customers with modest premium reductions of around 5%, but any savings is beneficial.
Inquire about loyalty discounts after being with your insurer for at least 3 years. Just be sure to compare quotes occasionally to guarantee loyalty perks offer the best rate.
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22. Seek Out Group Insurance
Some employers, unions, and business associations negotiate with insurers on behalf of their members to offer group insurance plans. This allows individuals to get coverage at lower group rates through their affiliation.
If you belong to any professional organizations, check to see if they sponsor a discounted group insurance program. The savings from group plans can amount to 10% off typical rates.
23. Pay Your Bill Early
Paying your insurance bill before the due date can earn you an early payment discount from some insurers. Most allow at least 15 days to pay before applying late fees or cancelling your policy.
Paying early avoids the risk of a lapse in coverage while rewarding insurers with faster payment. While the typical discount is modest at around 3%, any savings helps trim costs.
24. Bundle Renters Insurance with Auto
If you rent rather than own your home, bundling renters insurance alongside auto coverage can provide discounts similar to bundling home and auto. Multi-policy and loyalty discounts also apply when adding renters insurance to your car policy.
Savings from bundling renters and auto insurance can amount to 10% to 20%. Just compare quotes for standalone policies and bundles to uncover the best rate.
25. Use Windshield Repair Rather than Replacement
Choosing to repair minor windshield chips and cracks rather than replacing your entire windshield can help avoid increased premiums. Some insurers apply surcharges after filing a glass claim.
Windshield repair is inexpensive at around $50 to $75 compared to $200 or more for replacement. Preventing your insurer from having to process a claim keeps costs down on both sides.
26. Improve Your Credit Score
Most insurers check your credit before issuing a policy, and households with excellent credit typically enjoy the lowest car insurance rates. Improving your score could potentially shave 15% or more off your premiums.
Pay bills on time, pay down debts, check for errors on your credit reports, and take other steps to boost your score. A credit cleanup can provide big insurance savings over time.
27. Remove Teenage Drivers From Your Policy
Teen drivers with limited experience often bump up policy premiums substantially. Removing them from your policy can yield big savings, though this means they’ll need their own car insurance plan.
If a teen only drives occasionally, using parent’s exclusion may be a better alternative to keep them insured while limiting access to the vehicle. But fully removing teen drivers always offers the most savings on your policy.
28. Seek Out Additional Discounts
Check with your insurer about additional discounts they may offer that aren’t widely advertised. For example, some companies reduce premiums if you take an insurance awareness course.
There are also military service, retirement, disability, and non-smoker discounts with select insurers. Ask your provider what other ways you could potentially save on premiums beyond standard discounts.
29. Reduce Coverage for Older Vehicles
Consider dropping comprehensive and collision coverage on older cars worth less than $3,000 or $4,000. For a high-mileage vehicle worth less than a few thousand dollars, the premiums on physical damage coverage often exceed any potential claim benefit.
Liability insurance is still required, but eliminating comprehensive and collision can reduce premiums by 50% or more on an old car. Just be prepared to self-insure collision repairs.
30. Seek Out Discounts for Hybrid and Electric Vehicles
To promote eco-friendly vehicle adoption, many insurers offer generous discounts for insuring hybrid and electric cars. These incentives amount to 5% to 15% off premiums on average, with some discounts reaching 25% or more.
Hybrid and electric vehicles have lower accident rates, and their drivers tend to have fewer claims. Confirm discounts and optimal coverage when insuring alternative fuel vehicles.
31. Take Advantage Of New Customer Discounts
When shopping for a new insurer, many companies offer discounts of up to 10% for signing up as a new customer. To take advantage, compare quotes every 6 months to find insurers extending new customer offers.
Switching insurers to continually claim new customer discounts can save you hundreds of dollars over time. Just beware of fees from breaking an existing contract early if switching mid-policy term.
32. Seek Out Senior Driver Insurance Discounts
Once you reach age 50 or 55, you become eligible for discounts based on your age and experience behind the wheel. Savings range from 5% to 30% for mature drivers with clean records.
Insurers incentivize senior drivers due to their reduced risk and accident rates. Make sure to inquire about discounts for older motorists to trim your premiums.
33. Ask About Co-Pilot Discounts
Some insurers extend discounts if you regularly carpool or ride with a passenger. Carrying an extra passenger allows for a trade-off between driving and assistance with navigation and spotting hazards.
Co-pilot discounts range from 5% to 15% off premiums. Let your insurer know if you consistently ride with a passenger to potentially qualify for savings.
34. Reduce Your Annual Mileage
We’ve already discussed how maintaining low annual mileage can lower your insurance premiums. But even modest reductions in how much you drive each year could earn you discounts. Ask your insurer if they offer mileage reduction discounts.
Cutting your driving by just 5,000 miles per year could save you 5% or more. Combine reduced mileage with taking public transportation and your savings really add up.
35. Seek Out Affinity Group Discounts
In addition to occupational and alumni associations, many other types of affinity groups partner with insurance companies to offer their members discounted rates. Homeowner associations, charitable organizations, and even some social clubs provide insurance discounts.
Ask about special rates through any non-professional groups you belong to. While affinity discounts typically amount to just 5% or 10%, joining multiple groups adds up the savings.
The Value of Uncovering Hidden Car Insurance Discounts
Getting hidden discounts on your car insurance can lead to significant savings that really add up over time. While your insurance company is required to provide certain standard discounts like multi-policy, good driver, etc., there are still many hidden auto insurance discounts that will help you reduce your rates. You just need to do a little digging to find them.
Taking the time to seek out hidden car insurance discounts can save you hundreds per year so it’s definitely worth your time. To check for all the discounts you qualify for, enter your zip code and fill out a free five-minute quote. Save more on the auto insurance coverage you today.