There are many people that stay with the same insurer and keep the same auto insurance policy for years. The main reason is that they are paying a relatively affordable auto insurance premium and are offered a satisfactory car insurance policy. Therefore, they are not interested in changing, or at least, shopping around for auto insurance for a period of 20 or even 30 years.
It may seem more convenient to have the same auto insurance policy for years, but most of the times it is a bad financial strategy. Insurance is a dynamic field that adjusts to consumer needs. As consumers become more sophisticated and demand better products and a better quality of life, insurers adjust their policies and offer better products to satisfy these needs. By sticking to your old insurer, you are more likely to miss out on improved auto insurance policies and on great auto insurance discounts.
The following are auto insurance discounts that could get you better coverage at a lower premium.
1. Low-mileage discount
Low mileage discounts are offered to drivers that drive less and spend less time on the road. Driving less means lower possibility to be involved in a car accident and lower risk for the auto insurer. The key factor to determine the level of discount you may qualify for is where you live and where your work is; this determines how many miles you are required to drive on a daily basis. If you put less than 7,500 miles per year on your car, you may qualify for low-mileage discount. If you put more than 15,000 miles per year on your car, your car insurer may not approve a mileage discount. The typical low-mileage discount may exceed 40%.
2. Safe driver discount
Most auto insurance companies offer discounts to drivers who stay accident-free for a period of three years minimum. The amount of discount varies from insurer to insurer and it is also important to have a clean driving record. For example, if you stay accident-free, but you have a lot of speeding tickets, DUI tickets, or tickets for reckless driving, you may not qualify for safe driver discount. The typical discount is 10% and even of some insurers offer additional incentives of safe driving it cannot exceed 20%.
3. Anti-theft device discount
If your vehicle has an electronic immobilizer that can cut off power to the fuel, starter or ignition system or an alarm system or a vehicle alarm with a built-in immobilizer or any mechanical device that can minimize the steering wheel movement, you may qualify for anti-theft device discount. All above mentioned anti-theft devices disable your car and thieves cannot drive it, so the risk undertaken by your insurer is minimized. The typical discount is 2%-4%.
4. Safety features discount
Your auto insurance premium is determined by the risk that the auto insurance company undertakes to insure your vehicle. Car safety features lower the possibility of bodily injuries and theft and consequently the risk undertaken by your auto insurer. If you vehicle has seat belts, car alarms, anti-lock brakes (ABS), daytime running lights (DRL), electronic stability control (ESC), tracking devices, tire pressure monitoring systems (TPMS), frontal air bags and side airbags, you may qualify for the safety features discount. The typical discount is 3%-5%.
5. Multi-policy discount
If you have multiple auto insurance policies with the same insurer, including a second car insurance policy, homeowner’s insurance policy, renter’s insurance policy, or even health insurance policy depending on the insurer, you may qualify for a multi-policy discount. The typical discount may be up to 25%, depending on the provider.
6. Good credit rating discount
Making timely payments on your bills and having a good credit may earn you a good credit rating discount up to 4%.
7. Full premium paid discount
Paying your annual insurance premium at once instead of paying in installments may earn you a full premium paid discount up to 10%.
Today, auto insurance companies can provide you with great auto insurance discounts that can offer you the best coverage at the best premium. Don’t be afraid to explore your opportunities. By sticking to your old insurer, you may be missing out on great auto insurance discounts.
Sources
http://www.carinsurancerates.com/discount-car-insurance.html
http://www.tree.com/autos/blog-auto-guru/archive-2011-03-23-auto-insurance-discounts-you-may-be-missing-out-on.aspx
Personal experience