Key takeaways
- Insurance companies offer discounts for safe driving, demographic factors, vehicle safety, customer loyalty and other factors, such as good grades or automatic payments.
- Exploring available discounts with your current insurer or switching to a company with more discounts that fit your profile could save you money on car insurance.
- In addition to discounts, you may be able to lower your car insurance premium by raising your deductible, practicing safe driving or shopping often for new rates.
Car insurance is a legal requirement in most states, but the cost of this mandatory financial protection is on the rise in 2024. With inflation and car repair costs driving up the price of coverage, smart application of discounts is one of the best ways to reduce auto insurance costs. To help drivers identify and seek out the discounts with the greatest savings potential, Bankrate’s insurance editorial team reviewed available discounts from a wide range of auto insurance companies to find the best options.
How to get car insurance discounts
There are two primary ways to use auto insurance discounts to your advantage. First, if you have an active auto insurance policy, review the discounts currently applied to your policy and see if your insurance company offers other discounts that could lower your rates. You can review your policy’s declarations page on your own or speak to your insurance agent and request a thorough policy review. Ask your agent how to get car insurance discounts that fit your profile.
If you’re not satisfied with the discounts you’re currently getting, look at discount options available from other car insurance companies and consider switching carriers for a lower rate. While some discounts, such as bundling discounts and multi-car discounts, are fairly standard across carriers, discount amounts, eligibility terms and unique discounts can vary considerably between companies.
Types of car insurance discounts
Bankrate’s team of insurance experts has identified four main categories of car insurance discounts: driver-based or demographic discounts, driving-based discounts, vehicle-based discounts and loyalty-based discounts. Your insurer may also have other miscellaneous discounts, but these four categories cover the bulk of the common auto insurance discounts offered by most carriers.
Because eligibility and the amount saved for each discount on auto insurance vary by insurance company, it’s important to shop around with different carriers when looking for cheap car insurance. After receiving quotes back, review the discounts and their impact on your insurance rates, and check if you might be missing any of the discount opportunities below.
Driver-based discounts
Some car insurance discounts are based on a driver’s characteristics, such as their age group, profession or membership in an affiliated group. While certain discounts may be applied automatically, it never hurts to ask if you don’t see a discount you think you’re eligible for on your declarations page.
| Discount type | Potential savings | Who the discount is for |
|---|---|---|
| Young driver discounts | Varies by program | Young drivers between the ages of 16 and 25 |
| Student discounts | Varies by school level and GPA | High school or college students who are currently enrolled full-time |
| Military discounts | *Up to 25% | Active and former military members, and some qualified family members |
| Professionals discounts | Varies by industry | Individuals who are in qualified industries, such as education or health care |
| Organizational based discounts | *Up to 12% | Individuals who are members of or employed by partner organizations |
*This is the highest discount based on our research of top providers in the market. Your actual savings may vary.
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Young drivers face some of the most expensive average car insurance rates of all age demographics, but there are ways to earn discounts. To save money on car insurance for young drivers, some carriers offer a discount for completing a safe driving course designed for teen and young drivers, while others offer telematics programs intended to help young drivers practice safe driving habits.
Offered by major insurance companies like: Amica, Progressive, State Farm
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Adding student discounts is another chance to save on your car insurance premium. By maintaining a good GPA (typically a B average or higher), high school and college students may be able to add a Good Student discount to their policy. Additionally, college students who attend school far away from home and don’t take a family car with them may also be able to qualify for a distant student discount. Students typically need to be enrolled full-time to be eligible for this type of discount.
Offered by major insurance companies like: Allstate, Farmers, Travelers
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Some insurance companies also offer discounts specifically for military members. Whether you are on active duty or active reserves, or retired or honorably discharged, you and qualified family members may be able to qualify for an extra discount, as well as specific discounts for deployed service members. In addition, active duty military personnel based in Louisiana are eligible for a mandatory 25 percent discount from all insurance carriers.
Offered by major insurance companies like: Geico, Liberty Mutual, USAA
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Many insurance companies offer special car insurance discounts for particular professions. Certain professions like those in the medical, educational, engineering and financial fields may be able to inquire if their career qualifies them for a discount.
Offered by major insurance companies like: Farmers, Geico, The Hartford
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Membership in an organization could qualify you for another car insurance discount. While discounts are most commonly advertised for federal employees, alumni group members or employees of associated companies, asking your insurance agent if your particular membership qualifies you for a discount is the best way to find another savings opportunity.
Offered by major insurance companies like: Farmers, Geico, Travelers
Driving-based discounts
Having a clean driving record is generally the best way to qualify for many safe driving discounts, as it indicates to insurance companies that you are less likely to file claims. However, even without a spotless record, there are still some driving-based discounts you could qualify to earn auto insurance savings for your driving.
| Discount type | Potential savings | Who the discount is for |
|---|---|---|
| Safe driver discounts | Varies | Safe drivers who have not been in an at-fault accident or received a moving violation conviction |
| Telematics discounts | *Up to 40%, if performing well | Drivers who enroll in a telematics program to share live driving data with their insurer and avoid unsafe habits like hard braking |
| Low-mileage discounts | Varies based on miles driven | Drivers who do not commute daily and drive very infrequently |
| Defensive driving course discounts | *Up to 5% | For people who are looking to improve their driving skills and reaction times |
*This is the highest discount based on our research of top providers in the market. Your actual savings may vary.
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To qualify for a safe driver discount, a driver must go a certain number of years without any at-fault accidents or moving violation convictions. The amount of time required to qualify as well as the size of the discount differ depending on the insurance company, so it’s worth shopping around to see what different carriers offer you.
Offered by major insurance companies like: Geico, Nationwide, USAA
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Most major insurers now offer telematics programs, which allow drivers to track their driving in real time using GPS technology and share the data with their insurance company via a mobile app. In most cases, drivers must track and share their driving for a certain trial period, during which they receive a small discount for program enrollment. Following the test period, the insurance company will recalculate premiums based on driving data, with discounts awarded to drivers who avoid unsafe behaviors like harsh acceleration and hard braking, speeding or phone use.
Offered by major insurance companies like: Progressive, Allstate, State Farm
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The average driver puts around 13,500 miles per year on their car. Drivers who have lower than typical annual mileage may qualify for a low-mileage discount. If you normally drive less than the average U.S. driver or only drive occasionally, a program specifically for low-mileage drivers could be worth a look. Most auto insurance companies also request odometer readings every year to calculate your rates correctly. If you do not drive very often, it may be worth contacting your insurance carrier to learn the requirements to qualify for this type of discount.
Offered by major insurance companies like: Allstate (Milewise), Nationwide (SmartMiles), American Family
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Discounts for completing a defensive driving course may vary by state and carrier, but they’re most often available for drivers over age 55. The course will generally need to be approved both by the state and the insurer in order to result in a discount.
Offered by major insurance companies like: Farmers, Geico, Nationwide
What Bankrate staffers have to say about their driving-based discounts
We asked Bankrate staff members who have gotten an auto insurance discount based on their driving about their experience. What we heard: while this type of discount might not make a huge dent in your premium, it’s a helpful tool to keep your rates a bit lower.
Safe driving discount
“I chose Progressive because it offered an attractive rate and came with the opportunity to earn more discounts for safe driving. I opted into the telematics program and consider myself a cautious driver, but the additional discount I earned was small.” – Bankrate employee
Low mileage discount
“Telling the auto insurance carrier about my reduced mileage reduced the premium a little.” – Bankrate employee, Progressive customer
Vehicle-based discounts
Your car’s installed features, such as anti-lock brakes, adaptive cruise control, daytime running lights and safety features, may make driving safer and help you to avoid accidents. Depending on your car insurance carrier, you may earn a discount for these features due to your lower risk.
| Discount type | Potential savings | Who the discount is for |
|---|---|---|
| Safety features discounts | *Up to 5% | Vehicles that have specific safety features outlined by the insurance carrier |
| Anti-theft discounts | *Up to 23% | Vehicles that have anti-theft features outlined by the insurance carrier |
| Hybrid/electric vehicle discounts | Varies by carrier | Hybrid or electric vehicles |
| New vehicle discounts | *Up to 15% | Vehicles three-model-years-old or newer |
*This is the highest discount based on our research of top providers in the market. Your actual savings may vary.
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Most new cars may come with a few standard safety features, such as anti-lock brakes, passive restraint and air bags. You may even be able to customize your car to include more safety add-ons. However, keep in mind that every car insurance company is different, and the qualifications for safety features and discount amounts may vary.
Offered by major insurance companies like: Allstate, Geico, Travelers
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Comprehensive insurance covers theft of your car, which can be costly for your insurer and inconvenient for you. For this reason, some carriers may offer an additional anti-theft discount for deterrents installed in your car.
Offered by major insurance companies like: Farmers, Geico, Nationwide
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Some insurers incentivize customers who own alternative fuel vehicles, including hybrid and electric cars, by offering discounts on car insurance. Only a few companies currently offer this type of discount, so shopping around could save you money if you own an EV or hybrid.
Offered by major insurance companies like: Farmers, Travelers
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In some cases, your insurance company may offer a discount if you own or lease a new vehicle (typically three-model-years-old or newer). You may also need to prove that you’re the car’s first owner in order to qualify for a discount.
Offered by major insurance companies like: Geico, Allstate
Loyalty-based discounts
Once you have found a company that works for you, you may earn additional discounts for staying insured by the company, especially if you bundle your car insurance with home, life, boat or another type of insurance.
| Discount type | Potential savings | Who the discount is for |
|---|---|---|
| Multi-car discounts | *Up to 25% | Drivers who insure more than one registered vehicle at their household |
| Multi-policy discounts | *Up to 25% | Policyholders who bundle two or more policies with a single carrier |
| Continuous policyholder discount | Varies by company and length of being insured | Policyholders who have maintained coverage either on their own or with the same carrier for several years |
| Legacy discount | *Up to 10% | Policyholders under 25 who open a standalone account after being insured on a parent’s account with the same company |
*This is the highest discount based on our research of top providers in the market. Your actual savings may vary.
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If you are insuring more than one car, including both vehicles on a single policy could be an easy way to earn a discount. Keep in mind that the car needs to be registered to you or your spouse if you are married.
Offered by major insurance companies like: Geico, Liberty Mutual, Progressive
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Bundling is a common discount offered by most major insurers and often offers significant savings. Whether you own your home or rent, having both your car insurance and your homeowners or renters insurance with one company could give you a discount on the premiums. There may also be bundling discounts available for bundling your auto insurance with other policies, like life or umbrella.
Offered by major insurance companies like: Nationwide, State Farm, Travelers
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Depending on the carrier, this discount could be interpreted in two ways. Some insurance companies, like Progressive, may offer this discount to new policyholders based on how many years they were continuously insured at a previous carrier. Other insurance companies may consider how many years an insured has been with them, although it is common that it’s not included as a discount, but factored into the overall premium before discounts.
Offered by major insurance companies like: Progressive, Travelers, USAA
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A few carriers offer special discounts to young policyholders who split off of a parent’s policy to establish their own account with the same insurer. Exact eligibility requirements vary, but you typically must have been insured on a parent’s policy for at least a year before starting your own standalone policy.
Offered by major insurance companies like: Farmers, USAA
My advice for people looking to save money on auto or home insurance is to bundle your coverage. Allstate has among the best bundling discounts out there. But keep in mind, bundling isn’t the best option for everyone. Splitting policies might be the most cost effective and that’s why it’s important to do your homework when choosing a provider.
— Linda Bell, Senior Writer, Bankrate
Other car insurance discounts
We’ve covered the most common auto insurance discounts, but more opportunities to save on car insurance may be available. Below are some discounts that all insurers may not offer, but they are worth asking about to see if you can include them.
New policyholder discount
To incentivize drivers considering switching their car insurance companies, some carriers may offer a new policyholder discount. This additional discount may be applicable for the first period of the new policy and eventually fall off.
Married discount
Compared to single drivers, car insurance for married drivers may be cheaper. Single drivers pay an average of $2,348 per year for full coverage car insurance, while married drivers typically pay $2,205 per year, based on our September 2024 analysis of average premium data from Quadrant Information Services.
Homeowner discount
As homeowners are generally more financially stable than renters, they may be able to receive a discount on auto insurance due to having a lower likelihood of needing to file claims. If your insurance company doesn’t offer home insurance, making a multiple policy discount unavailable, you can ask if a homeowner discount is available.
Billing discounts
Depending on your billing and payment method, you may be able to earn more discounts on your policy. The most commonly seen are paperless billing, automatic billing and paid-in-full discount, but check with your insurance agent to see if there may be anything unique to your company that you can participate in.
How to find the best car insurance discounts
Shopping for car insurance can be an involved process. You may be considering how much car insurance you need, what coverage options to include and which carrier will give you the most competitive premium. Knowing the available discount opportunities and taking advantage of them could make a huge difference in finding the best car insurance policy within your budget. Below are some tips on finding car insurance discounts:
- Research a carrier website. This is a good place to start. Most carriers list discounts you could be eligible for and any additional information about eligibility guidelines and how to claim the cost-savings.
- Ask a licensed agent. They can provide even more specific information regarding discounts you’ve already identified and share details about state-specific discounts you may not know about.
- Talk to friends or family. Referrals are a great way to find an insurance company that offers generous discounts. You may find that the discounts are more attractive than your current provider offers, and it could be worthwhile to switch insurance companies to receive the same level of coverage at a lower rate.
Other ways to save on car insurance
Discounts could help to lower your car insurance premiums, but other smart saving strategies include:
- Compare rates often. As the insurance market continues to respond to inflation, carriers may change rates often — so shopping around whenever your policy is up for renewal could save you money.
- Practice safe driving. A clean driving record puts you at a significant advantage when looking for affordable car insurance. In addition to qualifying you for discounts, it also ensures you’ll pay a lower base rate for coverage.
- Build your credit. In most states, your credit history plays a major role in the amount you pay for auto insurance. Moving to a higher credit tier could reduce your car insurance costs.
- Raise your deductibles. If you have full coverage on your policy, raising the deductibles attached to your comprehensive and collision coverage could slightly reduce your premiums. Be careful, however, not to select a deductible you can’t realistically pay in the event of a covered loss.
Frequently asked questions
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All included discounts on your car insurance policy can be found in your policy declarations page. If you’re still in the quoting process, it will be on the quote completed by the company. You can use this to compare carriers to one another to see which one offers you more discounts and how much the discount decreases the premium.
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Some telematics programs might raise your rates if the program detects unsafe driving behaviors like hard braking, speeding or phone use. Progressive and Allstate, for instance, structure the program so that your rates will be affected if you drive poorly while others, such as Nationwide, guarantee that the program is a discount-only opportunity. Check with your insurance agent to learn more about the specific program they offer before enrolling. As telematics programs gain popularity, opinions are divided about whether these programs are worth it, but they are definitely something you might want to look into to see if they are right for you.
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Most car insurance companies will ask for an odometer reading when you start your policy, and may also request one every year thereafter to get a sense of how much you drive. Drivers who are on the road more often tend to pay higher rates compared to low-mileage drivers. If your commute or annual mileage has changed recently, check with your insurance agent on how this might affect your car insurance rates.
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Each insurance company uses its own underwriting algorithm to determine your rate. For example, let’s say you have a speeding ticket on your record. Some insurers may quote you a higher rate because of your driving history, while others may look more favorably on drivers with less-than-perfect driving records. The same goes for any other car insurance rating factor.
Because these rating factors are interdependent, and because insurance companies don’t make their underwriting algorithms public, casting a wider net in your car insurance search can help you hone in on the provider that offers you the best rate for your unique driving profile and coverage needs. Different providers also may offer different discounts for auto insurance, which is worth keeping in mind while you shop.
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The kind of vehicle you drive can play a large role in determining both your rate and the number of discounts you can add to your car insurance policy. If your vehicle comes equipped with safety features, those could help you earn more discounts. These features may help you avoid accidents that could cost both you and your insurer quite a bit of money.
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