Riding the discount road on vehicle insurance

Edward Poll, The Daily Record Newswire

Money saved is money earned. It's a nice sentiment, to be sure, but not always with any practical applicability in business because often it is difficult to find ways to save money in business. However, car insurance is one big exception.

Car insurance is, of course, mandatory insurance, but it is one of those types of insurance for which it is worth the extra time and effort to shop around and compare premiums.

Different companies offer different types of discounts, many of which you might not even know exist. If you haven't reviewed your policy recently, it's time to talk to your agent and check out what's available. And then it's time to talk to agents of other insurance companies to see what they have to offer.

"Who Offers the Most Car Insurance Discounts," an article on www.bankrate.com by Rose Hanson, notes that there is a lot of competition among insurance providers, so the buyer has an edge. The article compares vehicle insurance discounts offered by the ten largest vehicle insurance companies (based on 2013 market share as determined by the National Association of Insurance Commissioners).

One of the best ways to get a discount is to purchase multiple types of insurance policies from one provider. All ten featured insurance companies offer this type of discount. All ten companies also offer a good student discount for younger drivers with good grades.

Other discounts are offered by nine out of the ten providers: multivehicle (more than one vehicle insured with the company), passive restraint (safety features, including air bags and motorized seat belts), and safe driver (clean driving record).

Eighty percent of the providers offer discounts for low mileage (drivers might need to install an electronic monitoring device), payment in full (one lump sum instead of monthly installments), defensive driver (defensive driving class, a discount that might only be offered to senior drivers), paperless billing / automatic payment, and distant student (younger drivers attending school at a distant location).

Seven of the 10 insurance companies offer a discount to drivers with antilock brakes, and you can get a loyalty discount at six of the companies if you have stayed with one of those companies for a certain period of time.

Half of the featured insurance companies offer discounts for a newer vehicle, military members, nonmilitary affinity (member of a certain group, such as an alumni of a certain college, or occupation), and early signing (switching a certain number of days before an existing policy expires).

A few discounts more rarely offered include a price break for daytime running lights (four companies) and green hybrids or alternative-fuel vehicles (three companies).

Other less common discounts that bankrate.com discovered include recent marriage and willingness to assure a company that all passengers wear seat belts all the time.

The website compiles this information because it is often difficult to find the relevant information on the various websites, and the article notes that it's important to look beyond just the websites of various companies to get complete information.

In addition, it's important to note that not all discounts are available in all states. And, obviously, there are many insurers besides the top ten companies featured on the bankrate.com site, and it makes good business sense to check out as many as possible.

Finally, as the article notes, just because a company offers the most and largest discounts does not mean that such company will have the best overall rate. You might be able to find a better premium with a company that offers fewer discounts. And other factors such as service and rapid claims service may sway your decision despite a discounted cost factor.

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Edward Poll, J.D., M.B.A., CMC, is a law practice management thought leader and contributor to this publication. His website is at www.lawbiz.com.

Published: Mon, Sep 08, 2014