Here’s a breakdown of how we reviewed and rated the top auto insurance providers
Key Takeaways
- Most of the top auto insurers offer discounts for safe drivers and good students.
- Bundling policies is a reliable way to save on car insurance premiums.
- Programs that track real-time driving data reward safe habits with insurance discounts.
Everyone likes saving money. Thankfully, car insurance companies understand this, and usually offer a range of discounts to help policyholders reduce their premiums. In this article, we at the MarketWatch Guides team highlight a few of the common discounts that the best car insurance companies offer.
Learn more about our methodology and editorial guidelines.
Common Car Insurance Discounts
While each auto insurer offers a different selection of car insurance discounts, many commonalities can be found across providers. Most standard auto insurance discounts can be grouped into the following categories:
- Driver safety: These discounts help drivers with a clean driving record lower the cost of their policy.
- Driver profile: Most insurers offer discounts for students, seniors, military members and veterans, and members of professional associations.
- Customer loyalty: If you bundle your policies under the same insurer, pay your premium in full, or set up automatic payments, you may qualify for discounts.
- Vehicle attributes: Your vehicle’s specific features may qualify you for discounts. Commonly, drivers can save money if their vehicle has anti-theft technology, anti-lock brakes and certain types of airbags and seatbelts.
In the following sections, we will review some of these standard auto insurance discounts in greater detail.
Driver Safety
Most insurers find ways to reward safe drivers. These are a few of the common car insurance discount types for drivers who maintain good habits behind the wheel:
Good Driver (Accident-Free) Discounts
Going a period of time — typically three to five years — without an accident can earn you significant discounts with many top auto insurers. The requirements for a good driver discount vary from one provider to another, so be sure to ask your agent if you qualify.
“Safe driving without traffic violations or accidents demonstrates responsibility to insurers, often resulting in lower rates.”
Usage-Based Insurance Discounts
This type of discount comes with the use of a telematics program that tracks your driving habits — either through a mobile app or a plug-in device. If you avoid sudden stops, rapid acceleration and speeding while enrolled in such a program, you can save up to 30% upon policy renewal with certain providers.
Defensive Driving Course Discounts
Completing a defensive driving course typically takes just a few hours, but it can save you 10% to 15% on your car insurance costs. Before you sign up for any driving class, make sure it’s approved by your provider. Some companies only offer these discounts to younger drivers and senior citizens.
Low-Mileage Discounts
If you only drive occasionally, you may save as much as 20% on your car insurance premiums. The average driver puts about 13,500 miles on their odometer each year, according to the Federal Highway Administration. Those who drive less than 7,500 miles annually are often eligible for savings. Some insurers require a telematics device to verify mileage.
Driver Profile
A driver’s profile — like their age or occupation — could be as impactful as their driving history for determining their discount eligibility. Here are some examples of particular savings opportunities based on drivers’ personal attributes:
Student Discounts
Almost every auto insurer offers some type of discount for students with good grades. This is great for insurance customers, as coverage costs are especially high for drivers under age 21. Exploring insurance options for new drivers can help young policyholders find the best combination of coverage and affordability. Full-time students who maintain at least a “B” average often qualify for good student discounts as high as 25%.
There are also away-from-home discounts for college students who leave their vehicles behind while attending school 100 or more miles from home. Some companies call this a distant student discount.
Military and Federal Employee Discounts
USAA — which only provides insurance policies to active military service members, veterans and their immediate families — maintains low rates for those who qualify. Many other providers offer discounts of up to 15% for members of the military and veterans. If you’re actively serving or a veteran, researching specialized coverage for military members can help you access exclusive savings opportunities. Discounts for federal employees vary.
Professional and Academic Discounts
Some insurance companies have affiliations with trade organizations and alumni associations. Geico is the industry leader in this regard, partnering with over 500 professional and university organizations to offer discounted rates to policyholders.
Senior Discounts
Some insurers offer discounts available for senior drivers 55 years old and older. You’ll also find incentives for drivers over 55 years old to keep their driving skills sharp through online driver improvement programs.
Customer Loyalty
Auto insurance providers offer a number of customer loyalty discounts. Some companies automatically apply these discounts while you have to request a loyalty-based discount from other providers. Here are a few common examples of customer loyalty discounts for auto insurance:
Bundling/Multi-Policy Discount
Bundling or multi-policy discounts are some of the most common and regularly promoted options for insurance savings. Many customers find significant value in bundling home and auto policies under a single provider to maximize their discount potential. Policyholders may be able to access a wide range of savings by bundling their auto policy with home, life, boat or other types of coverage. Some companies offer as much as 25% off your total insurance premium when you bundle policies.
Multi-Vehicle Discount
The savings potential from a multi-car policy discount varies by provider. Some insurers like State Farm offer as much as 20% off for adding multiple vehicles to your policy. Other companies may offer discounts in the 10% to 15% range for insuring multiple cars.
Payment Discounts
Pay-in-full, autopay and paperless statement discounts fall under this umbrella. Paying your entire premium upfront — whether for a six-month or year-long term — often results in savings of about 10%.
Setting up automatic payments from a checking account, debit or credit card can save you up to 10%. Since going paperless saves insurers some overhead costs related to printing and mailing paper statements, companies often reward customers for choosing this option with discounts of up to 10% off.
Vehicle Attributes
Specifics about your vehicle can also earn you special car insurance discounts. Some companies even offer discounts simply for insuring a new car. Here are a few other common discounts related to vehicle attributes:
Anti-Theft Discounts
Installing an anti-theft device can save you up to 15% on your comprehensive coverage. If you live in an area with a high rate of car theft, or if you have a make and model that’s commonly stolen, it’s a good idea to install an anti-theft device, even if the insurance discount is marginal.
Anti-Lock Brakes Discounts
Many insurers offer discounts of up to 10% off your collision coverage for having a factory-installed anti-lock braking system (ABS). It’s a good idea to ask your agent to verify this discount, as it should be automatically applied after purchase.
Passive Restraint Discounts
This type of discount applies to seat belts and front airbags. You may save up to 30% on your personal injury protection (PIP) or medical payments premiums simply by having factory-installed seat belts and front airbags.
Auto Insurance Discounts Offered by Top Providers
We evaluated every major auto coverage provider to identify our picks for the best in the industry. Here’s how some of those top picks compare in terms of common car insurance discounts. Below, we identify some of the unique discounts offered by these providers as well. Be aware that these discounts may not be available in every state.
| Discount | Geico | USAA | Progressive | State Farm | Liberty Mutual |
|---|---|---|---|---|---|
| Safe driver | ✓ | ✓ | ✓ | ✓ | |
| Good student | ✓ | ✓ | ✓ | ✓ | ✓ |
| Multi-vehicle | ✓ | ✓ | ✓ | ✓ | ✓ |
| Multi-policy | ✓ | ✓ | ✓ | ✓ | ✓ |
| Usage-based | ✓ | ✓ | ✓ | ✓ | ✓ |
| Military | ✓ | ✓ | |||
| Vehicle safety | ✓ | ✓ | ✓ | ||
| Homeowner | ✓ | ✓ | |||
| Senior | ✓ | ||||
| New car | ✓ | ✓ |
Geico is the only insurance company that offers a discount for federal employees. At this time, that discount amount is 12%, and it applies to a policyholder’s total auto insurance premium. Members of certain corporate and alumni groups may also be eligible for a discount.
USAA insurance is only available to veterans, active military service members, and their family members, and offers a couple of unique car insurance discounts. Drivers can get a 60% discount if they store their vehicles in a secure location, which can be helpful during deployment. USAA also offers a 15% discount for garaging a vehicle on a military base.
Progressive is the only company on our list of top providers that offers a car insurance discount exclusively to teen drivers. Savings vary but the discount applies to young drivers up to 18 years old.
State Farm offers a driver training program called Steer Clear for people under age 25. This is an educational app that includes driving courses and quizzes. Successful participants can get a discount. The program is separate from a standard driver education course.
Liberty Mutual offers a special alternative energy discount for green vehicles, so you may want to check it out if you just bought a hybrid or electric vehicle. This discount varies by state.
Usage-Based Discount Programs in Depth
Usage-based programs can often help cautious drivers save more on car insurance. Most leading auto insurance companies offer some type of usage-based discount, though programs are not always available in every state.
Usage-based programs, also called telematics insurance programs, track your driving habits in real-time through a mobile app, plug-in device or a Bluetooth tracking beacon. You may be able to choose the type of monitoring device, depending on which insurer you’re with and where you live. Most usage-based programs offer a discount for signing up. Your initial discount is then reduced or enhanced based on your driving habits after the first tracking period. Often this takes place when your car insurance policy is renewed.
Here is a list of driver behaviors car insurance companies track through usage-based programs:
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Usage-Based Car Insurance Discount Programs by Company
People who are careful drivers or who drive very little typically see the best usage-based car insurance discounts. If you have poor driving habits while enrolled in a usage-based program, you may be penalized by losing your discount or having it reduced. Some programs, like Progressive’s Snapshot, can actually raise your rates based on your driving habits.
| Usage-Based Program | Geico DriveEasy | USAA SafePilot | Progressive Snapshot | State Farm Drive Safe & Save | Liberty Mutual RightTrack |
|---|---|---|---|---|---|
| State Availability | 41 states plus Washington, D.C. | 47 states plus Washington, D.C. (Available with restrictions in Massachusetts) | 50 states plus Washington, D.C. | 47 states plus Washington, D.C. | 40 states plus Washington, D.C. |
| Device | Mobile app only | Mobile app only | Mobile app or plug-in device | Mobile app or Bluetooth | Mobile app or plug-in device (for New York residents only) |
| Can rates increase? | Yes | No | Yes | No | No |
| Discount | Varies by state | Up to 30% | Average of $231 per year | Up to 30% | Up to 30% |
| What it tracks | Distracted driving, braking, time of day, distance, cornering, smoothness, weather and more | Location, time of day, phone handling, braking, phone use and more | Speed, time of day, mileage, acceleration, braking, location, phone use and more | Acceleration, braking, cornering, speeding, distracted driving and more | Braking, nighttime driving, rush hour driving, speed, distracted driving and more |
How Car Insurance Discounts Work on Your Policy
Car insurance discount availability and amounts vary by company. For example, State Farm offers a multi-car discount of up to 20% off your premium, while Geico’s comparable discount for bundling could save you up to 25%. So, while one company might be known for low prices in general, you might find better discounts from another insurer, which is why it pays to shop around.
Insurance discounts can apply to your entire policy or just one part of your policy. For example, it is common for auto safety discounts to apply to your medical insurance coverage and for anti-theft discounts to apply to the comprehensive coverage portion of your policy.
Finally, keep in mind that auto discounts are usually applied in sequence to your insurance policy cost, not all at once. For example, if you qualify for a 20% discount for bundling and a 10% discount for paperless billing, this won’t necessarily equate to 30% off your total insurance premium.
Instead, one discount might reduce your premium first, then another discount is applied to the remaining amount. Or, the two discounts could apply to different portions of your auto policy, such as your comprehensive coverage and your medical insurance coverage. The exact calculation will vary based on the provider and the specific discount.
Read through your policy statements to understand both how discounts are applied as well as the particular aspects of your coverage where you can save money.
How Else Can I Save Money on My Car Insurance?
Your rates are determined by your driver profile, credit score, the deductible you choose and other factors. Choosing a higher deductible may seem like an easy way to get cheaper car insurance. However, with a higher deductible, you’ll generally pay more out of pocket if you file a claim — such as after a car accident or damage during severe weather. While your premium can be lower, a higher deductible exposes you to greater financial risk in the case of an accident.
While you can’t control your age or your recent accident history, there are some things you can do to lower car insurance costs. Understanding the ways to find cheaper car insurance can help you maximize your savings beyond just discount programs. If you want to know how to lower your insurance rates, follow the tips below.
- Raise your credit score: Most states allow insurance companies to use your consumer credit history to determine risk and set premiums. By raising your credit score, you can find better rates over time.
- Shop around after life events: You should compare car insurance quotes after you get married, change ZIP codes, enroll in school or join the military. The same is true if the number of drivers in your household changes.
- Drive more cautiously: Accidents, moving violations and other tickets will fall off your record if you maintain good driving habits. You can also take advantage of usage-based discounts if you are a good driver.
- Drive less: If you can significantly reduce your average mileage with carpooling or public transit, you can ask your provider to reassess your rate to reflect a lower annual mileage.
- Pay up front: Many providers offer lower rates if your premium is paid in full.
- Shop around at each renewal: Insurance prices change constantly. Even if your situation is the same, it’s still a good idea to shop around every time your policy is up for renewal.
Opting for lower coverage limits or minimum coverage correlates to cheaper rates however, this may raise your financial risk if you cause a car accident or are injured in a wreck. Less coverage means higher out-of-pocket repair bills, so near-term savings can easily be erased with a single accident.
Car Insurance Discounts: FAQ
Below are frequently asked questions about car insurance discounts:
Comparing quotes from multiple providers, raising your credit score, and paying for your policy upfront are all ways to secure lower car insurance rates.
State Farm offers 16 total discounts, which is the most among our top-rated providers. Policyholders can save money on insurance with State Farm discounts for insuring multiple vehicles, completing defensive driving courses and bundling your auto policy with other types of insurance. You can also save money by avoiding traffic violations for three years and enrolling in the company’s Drive Safe & Save program.
To get full discounts on car insurance, simply fill out a quote form with your complete information. Chances are, you’ll qualify for a few discounts. Progressive, for example, claims that 99% of drivers qualify for at least one of the company’s discounts. Leading providers each offer about a dozen different discounts on average.
There is no cheapest month when it comes to buying car insurance. Car insurance rates don’t fluctuate based on time of the year — they’re calculated based on personal factors. We recommend shopping around for auto insurance quotes when possible to see if you can get a lower rate with your current insurance provider or with a different company.
After comparing multiple providers, we found that USAA offers the most affordable car insurance but only military families qualify. In most states, Geico tends to offer the cheapest insurance overall. Additionally, State Farm has great rates for students and Progressive offers relatively low premiums for high-risk drivers.
No, you can’t negotiate car insurance rates. States closely regulate insurance rates, so the best way to find a cheaper premium is to look at competing providers. You can always speak to an insurance agent to make sure you are receiving all of the applicable discounts when you get a quote.
Our Methodology
Because consumers rely on us to provide objective and accurate information, we created a comprehensive rating system to formulate our rankings of the best car insurance companies. We collected data on dozens of auto insurance providers to grade the companies on a wide range of ranking factors. The end result was an overall rating for each provider, with the insurers that scored the most points topping the list.
Here are the factors our ratings take into account:
- Coverage (30% of total score): Companies that offer a variety of choices for insurance coverage are more likely to meet consumer needs.
- Cost and Discounts (25% of total score): Auto insurance rate estimates generated by Quadrant Information Services and discount opportunities are both taken into consideration.
- Industry Standing (20% of total score): Our research team considers market share, ratings from industry experts and years in business when giving this score.
- Customer Experience (15% of total score): This score is based on volume of complaints reported by the National Association of Insurance Commissioners (NAIC) and customer satisfaction ratings reported by J.D. Power. We also consider the responsiveness, friendliness and helpfulness of each insurance company’s customer service team based on our own shopper analysis.
- Availability (10% of total score): Auto insurance companies with greater state availability and few eligibility requirements score highest in this category.
Our credentials:
- 800+ hours researched
- 130+ companies reviewed
- 8,500+ consumers surveyed
Studies and Ratings We Cite
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Our provider reviews cite several key industry studies and ratings, including:
- J.D. Power 2024 U.S. Insurance Shopping Study The annual J.D. Power U.S. Insurance Shopping Study measures customer satisfaction and purchase experience with auto insurance providers based on five categories: brand, price, distribution channel, quote process and policy offerings. The study average score is 676/1,000.
- J.D. Power 2024 U.S. Auto Claims Satisfaction Study The annual J.D. Power U.S. Auto Claims Study rates the claims experience customers have with different providers based on eight categories: trust, fairness of settlement, time to settle a claim, people, communication, ease of resolving a claim, ease of starting a claim and digital channels. Car insurance providers are assessed at the national level. The study average score is 697/1,000.
- NAIC Complaint Index The National Association of Insurance Commissioners Complaint Index is a representation of the number of complaints auto insurance providers receive relative to the average number of complaints for the industry based on their size. A score of 1 represents the average number of complaints for the industry.
*Data accurate at time of publication.
