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Almost every driver can qualify for an auto insurance discount with the right insurance company. Auto insurers began offering discounts as a way to shape behavior in an effort to reduce risks. Since certain drivers are drawn to specific discounts, the insurance industry noticed that large pools of drivers would start to form if a certain discount was offered. Compare auto insurance  companies with our FREE car insurance comparison tool!

When an insurance company can underwrite large numbers of safe drivers, their incomes rise and the annual number of claims decreases. When a driver shops around for the right auto insruance policy, the number of discounts offered by each insurance company comes to light.

When insurance companies calculate the cost of insuring certain vehicles, there is very little guesswork involved. Actual accident statistics are tracked by state insurance commissions. Police reports are used to gather accident information while repair shops provide actual cost data. Drivers can visit the website of the Insurance Institute for Highway Safety to determine the least expensive vehicles to insure if a new car purchase is on the horizon.

Make and model – When the cost of repairing the vehicle is known, the insurance company assigns a cost of repair. Over time, costs will moderate for popular vehicles because parts are more readily available. Certain cars are very expensive to insure because of repair and replacement costs.Safety features – Air bags, automatic seat belts and anti-lock brakes reduce the risk of injury for passengers involved in a car accident. All of these features are revealed in the VIN number on the vehicle when the insurance company begins to formulate a quote. Most safety features are factory-installed.Security devices – Electric locks and a factory-installed car alarm ensure that the vehicle is secured when the driver is not present. These devices will be indicated in the VIN, but the driver is wise to mention these features when asking for a quote.Anti-theft apparatus – Kill switches, steering wheel locks and tire locks are excellent theft deterrents. In areas where auto theft occurs often, the insurance company may require that an anti-theft apparatus is installed on the vehicle. Reducing the risk of theft saves money for the car insurance company.

Reducing risk of loss is the most important action a driver can take to receive lower car insurance premiums from the insurance companies. Many drivers are surprised to find that mature habits in other areas of life are rewarded by insurance companies. Most of the following discounts are awarded to responsible individuals who ask for them.

Clean driving record – When a driver does not incur a moving violation or speeding ticket for three or more consecutive years, the insurance company lowers the auto insurance premium. Safe driving is one of the most important factors for retaining low car insurance rates.Good credit score – Financial habits reflect an individual’s ability to handle responsibility in every area of life. If the credit score is low, the insurance companies will charge a higher premium for the individuals listed on the auto policy.Senior citizen – People older than 55 and younger than 80 years of age are considered more mature when their driving record remains free from violations. After the age of 80, some insurance companies will require reflex evaluations for their older drivers to ascertain their ability to drive safely.Good student – Young drivers with excellent school grades are rewarded with lower car insurance premiums because of their disciplined approach to school. Students with average grades are not charged higher than standard rates, but this discount is not given.Professional association – Corporate discounts are negotiated by some very large companies. Professional groups, such as physicians, accountants and attorneys, are offered lower rates because the insurance industry perceives drivers in these professions as more responsible.Low mileage – Every insurance company has a different idea of “low mileage” when it comes to driving a vehicle in a given month. Some companies offer discounts if the car is driven fewer than 100 miles in a month, but each insurer is different. The best way to find out is to inquire about this discount if the vehicle is not driven every day.Driver’s training – One day spend in a defensive driving course can reduce the annual auto insurance premium by as much as 30 percent. Every company is different, so the driver must shop around and then follow through and take the course. Other types of training, such as inclement weather training, will reduce rates because the risk of accidents is lowered.

Insurance companies offer various types of discounts that are related to their loyal customers. Each insurer will offer a variation on the following discounts, and the best way to find them is to ask during the quote process. All policy documentation must be verified to ensure that each promised discount was awarded.

Multi-policy – If the driver also has a home, purchasing both insurance policies from the same insurance company can save a great deal on both premiums. Life insurance policies will be discounted by most insurers when the car and home insurance policies are with the same insurer. The actual discount percentage varies by insurer.Multi-vehicle – One auto insurance policy with multiple cars listed in the coverage will be less expensive than separate policies for each vehicle. This method is especially important when teen drivers are added to the family insurance policy. Mature drivers can offset the cost of insuring a teen.Annual payment – Administrative costs are lower when one payment is made each year. Insurance companies will reduce the annual premium if they receive all of the money at the beginning of the policy year. Some insurers will allow policyholders to make quarterly payments, which are less expensive than twelve monthly payments.Deductible – Carrying a higher deductible on an auto insurance policy is one method of lowering the annual premium. Care must be exercised when setting the deductible amounts to avoid causing a financial hardship if an accident occurs. The amount of the deductible should be kept in a savings account.

When drivers shop around for auto insurance, the goal should be to acquire sufficient coverage against loss at an affordable price. A quote that is ridiculously low compared to the other quotes acquired should be evaluated closely. If an accident occurs, the coverage must cover the loss.

Drivers that cut corners on each of the major subcomponents, such as collision, comprehensive and liability might save money on the annual auto insurance premiums but will not be sufficiently insured. A prudent approach is to set appropriate coverage levels and ask for every possible discount for which the driver might qualify. Compare auto insurance  with our FREE comparison search below, gauranteed low auto insurance.

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