Auto insurance discounts are obviously “where the money is at,” or isn’t, in this case. They are the money that you put back into your pocket after your rate is determined. When you ask an auto insurance agent to generate a rate quote for you, the agent will provide you with a number that already includes the discounts that agent has found for you based on the answers you gave to the “ten questions.” You may not have answered the questions the most effectively, and the agent may not have known or cared to offer you all the discounts that were available. Your job is to make sure that neither of those things happens.

▪ The perfect strategy for you to follow as a consumer of auto insurance products is to “stack” as many discounts on top of each other as you possibly can ▪

Be prepared, at some point you may be asked to provide “verification”* of this thing or that. If so, you either can verify your eligibility for the particular discount, or you cannot. Even should you “lose” a particular discount because you could not “verify” it, you certainly had nothing to lose by claiming it.

Another little-known but very important fact in the auto insurance business:

▪ Few if any of the discounts you claim will ever verified by anyone ▪

But do be prepared to provide verification if needed. As with any discount that you lose because you could not verify it, consider this a teaching opportunity, and a reason to shop your insurance even harder at the next renewal.

Most everything said on the phone to an agent is recorded, (remember that you are being recorded as well!) and agents are scored on how well they question and correctly rate you the caller and potential policyholder. A lousy job by the agent results in a bad risk that is incorrectly priced for the company. A perfect job by the agent? A properly written and accurately priced policy that stays on the books and renews endlessly, with zero claims.

If you talk to an agent, make sure that they have the time to work with you, and an interest in doing so. Show some respect for them and their specialized knowledge, and they will become your confidante and advocate. Why would you do this? Because agents get paid for selling you a policy, usually whether or not it is a good policy, or a bad one. They know the number one factor for many potential policyholders is very simply the price of the insurance. Use this to your advantage, let the agent be your friend, and you will both win.

Online companies like us, allow you to “be your own agent,” by rating yourself and finding your own discounts online. When you complete the quoting process online and bind* your own coverage, that is effectively what you are doing. Keep in mind that much of the information you enter into the program will be electronically verified immediately, resulting in potential red flags for underwriters, like incorrect addresses, or zip codes that don’t match driver’s licenses, and so forth. If you will be quoting yourself online without an agent, make sure you have all your relevant information at hand, and enter everything as accurately as possible to avoid extra scrutiny of your policy.

▪ Three reports are used to rate you in most states, (accident, driving, and credit) with one major exception ▪

The Credit Based Insurance Score, or CBIS,* is not used in a few key states, and of these, California is the largest and most relevant market.

The CBIS is perhaps the most important discount of all when it is used, and where allowed, we are told that 92% of all insurance companies use it ▪
You will see, or be read a disclosure, then asked for your Social Security Number (SSN). This is a sure sign than it will most likely be used. Many people dislike the use of this score, and often unnecessarily so, as it usually helps them more than it hurts them. In a perfect world, paying bills late would not be an indicator of potential claims incidence. We are told that it is. Therefore over time, obviously the higher your CBIS, the better rates you will get. However, in one succinct statement, what follows is the most important issue to understand about the CBIS:

▪ It is only used to rate (“ tier”) on one driver, the first one listed, even if there are several other drivers on the same policy ▪

Since you will be driving for at least the next 10, 20, or 50 years, and you will be buying auto insurance for most if not all of those years, your goal should be to continuously reduce your total premiums paid, by maximizing your underwriting rating factors and discounts. The CBIS is not a flat-out FICO (credit score) number times a multiplier of some kind. It is based on many factors, sometimes 12 or more, and it varies by state. The nuances of each state are not really important, but what is important to remember is this:

Two different people, usually a husband and wife, (this is the most commonly seen example of this) may have vastly different factors, and subsequently a rating difference of two tiers or more between them ▪
Obviously you want the driver on the policy with the best CBIS to be the “primary named insured” or PNI.* If your CBIS is stellar, you want that to be you.

To easily determine this factor, regardless of what state you live in, simply quote the policy from both perspectives, first with one spouse (or driver) as the PNI, then the other. Make sure that the coverages you request are absolutely identical. Do this from different IP addresses, for example, do one quote by the husband at home, and one quote by the wife at the office. Use this strategy with each company you quote with.
Some programs will link quotes from the same IP address and “capture” the data from both, resulting in identical or nearly so rates. I know that my system would do so if I generated the quotes, so asking an agent to do this for you is typically useless.

The CBIS is only one rating factor among many, but it is a great place to start saving money on your auto insurance. Your strategy here is to always know who has the best CBIS among all the drivers that will be on the policy, and to always list that driver first.

Homeowner versus Renter rating factors ▪

Do you own or rent your home?”

For some reason, a household that pays “rent” to a bank each month, (since very few people actually “own” their home, “free and clear”) is somehow a better risk than one that pays rent to a landlord, who then makes a “payment” to that same bank. The “homeowners” discount will be substantial when offered, as much as ten percent or more.

Some companies offer additional options to obfuscate this, or to offer certain people less discount. These will appear as “live with parents,” or “own mobile home.” Watch out for this question. Determine whether or not you “own” your home. If you do, be sure to claim this discount.

▪ Teaser, or “switchover” discount ▪

This is the most often overlooked discount. Nearly every company will offer you a first-term or “teaser” rate that includes an “internet” or “online” discount, and may also include an “existing coverage,” or “switchover” discount to help pay for any cancellation fees you may have for changing insurers. Those “cancellation” fees are almost never allowed at renewal, so when you are ready to shop your rates, just make sure you request a “non-renewal”* of your policy, not a “cancellation,”* and you will never pay any of these fees. However, paying a $ 25 fee today to save $ 200 tomorrow is a no-brainer.

You will get these teaser discounts every term if you are willing to switch companies each term.   These two discounts are usually 5% each, so find a company offering both, and that’s another 10% off your rate. Of course, the loss of this first-term discount at renewal is no reason to immediately jump ship to another company, but it is a reason to shop around if your rate mysteriously goes up 5% every renewal from the company you are with now.

▪ Prior insurance discount, duration, and amount ▪

“Do you have insurance now? If so, how long have you had insurance? What are the limits of that policy?”

This line of questioning is used to determine your “proof of insurance” or POI*. Prior insurance is considered a strong rating factor, and coming into a new policy with high limits lowers your perceived risk to the underwriter. You always want to have at least one day of POI before you begin to seriously shop for insurance. In other words, if you do not have a policy now, buy one, then immediately shop for a better policy at a better price, with another carrier. You can do this as early as the next day!

If you have a policy now, but you are carrying low liability limits, (anything less than 100k/ 300k) raise the limit of your existing policy just before you begin shopping for a better rate. This one strategy will save you more money than anything else in this guide, so remember it. The exception would be that if you have a terrible driving record and accident history, it may have little or no effect on your rate.

Keep in mind though, that any POI you claim will always be verified to some extent, or you should always count on the fact that it will be ▪
This means that you always want the answers to this line of questioning to be “yes, I have liability insurance now. I’ve had it for a long time, and I have lots of it.” “Amount” of POI is rated up to the magical number at which the discount is maxed out, which is typically “100k/ 300k.”* (This means 100 thousand dollars per person/ 300 thousand per accident). A few “preferred” companies may offer slightly greater discounts for having even higher limits, like 300k/ 500k. The interesting thing about this question is that it is not asked as, “how long have you carried this limit?” but “how much do you have right now?” The fact that you called or went online with your existing carrier two days ago and increased all your limits to that sweet spot, is irrelevant to the question that is being asked today.

▪ Some important things to remember about POI ▪

Commercial insurance policies usually do not count, although if you were covered under a business policy while you drove a company car, this may qualify. Being a “named insured” on someone else’s policy does count, even if for only one day. Having had “foreign” auto insurance (anywhere outside of the U.S.) does not count, although Canadian polices usually do.

If you have lapsed your coverage for 24 hours or less, most companies will offer you a “grace period” and will rate you as if you still had continuous POI. You must bind your new policy within that first 24 hours. If you miss that deadline, some companies will still give you a partial discount for having had coverage within the last 30 days.

With that in mind, the agent (or company) may immediately ask you: “Can you verify your current POI?”

Providing verification will be as simple as printing out a copy of your declarations page from your current policy, and then sending it in by fax or email. The POI rating factor for “duration” or “how long have you had coverage?” is typically rated up to six years (the longer, the better) but in most cases only the first six months or year is “verified” through the submission of documents.

There is a military “exemption” to this POI requirement, whereby if you can document deployment (or training PCS), had insurance before deployment, and obtain new insurance within 30 days of your return, you can be rated for no lapse of coverage. Be sure to ask about this if you believe you qualify. If you do, it will be a very strong discount for you.

If you are a young or new driver, just starting out with your own insurance history, consider asking a resident friend or relative to add you (temporarily) to their “high-limit” policy (100k/ 300k or better) immediately before you begin to quote your own insurance. Your answers to the POI questions will then correctly be “less than one year,” and “100k/ 300k,” and your rates will be much better than if you had not followed this strategy.

In New York the price difference for this rating factor alone is huge, and it may be the one discount that allows you to afford your own insurance policy in the first place! You would also get the “switchover” discount if it is available. Even if the term of your “prior insurance” is as little as one day, you will still get the discount for having it.

Proper use of the POI discount will usually ensure that you get much higher limits of coverage for the same cost as “minimum liability,” if nothing else. The exception to this would be that if you have a history of claims, you will still be asked to pay more for better coverage, because you are a bigger risk. If this is happening to you, you need to clean up your driving record a little bit before you can expect the best possible rates from anyone.

Driver experience or “duration” discount ▪

“How old were you when you got your driver’s license in the United States?”

This is the critical discount factor for young drivers, East Coast drivers, and drivers new to this country. Often drivers in states with good public transit may be in their 30’ s or older when they are first licensed. Rates can double or triple on this one factor alone. Many people still believe in some mystical threshold for “driving age” discounts, and most think that it is 25 years old.

What is more commonly used as a rating factor is the amount of time since the driver was first licensed in the US, until now. The more the better. A 24 year-old first licensed at age 15 has nine years of driving experience. A 25 year-old first licensed at age 24 has one year of driving experience. Who should get the better rate? Of course the driver with nine years of driving experience.

Likewise it is with foreign drivers, newly licensed in this country. Even though you were licensed in your country at age 12, and have been driving on the “wrong” side of the road for 20 years, you still have little or no “driving experience for rating purposes. When you are quoting your U.S. auto insurance policy, and say that you were first licensed here last year, your rate will most certainly be high, with any carrier.

▪ The major exception here is that Canadian driving experience is usually an acceptable substitute ▪

Keep in mind that most of the information you give in response to this question is merely self-reported, and will not be verified in any meaningful way beyond determining that you do in fact have a valid license. Theoretically, I suppose it could be, by requiring every policy holder to provide abstracts from every license they have ever held in every state, but that’s not likely to happen.

▪ Mileage Discount ▪

 “How many miles per week or year will you be driving the vehicle?”

Another discount related to “driver experience,” is the usage or “mileage driven” rating factor. (See Risk). In the states that use it, it is very powerful, and can mean hundreds of dollars in premium in a single policy term. California is one such state. The fewer the miles driven, the lower the rate. If you get too greedy and claim below a certain threshold, you will be asked to verify your claim in order to keep the discount.
This is not too hard to do, but it is usually unnecessary if you accurately calculate the miles that you drive. Most people will overstate their actual mileage driven by thousands of miles, especially young people who see driving huge miles as a badge of honor, merrily paying higher insurance rates the entire way.

If you determine that you qualify for this discount, and you need to verify it, free “safety” or “brake check” inspections are available at many shops. Verification of this discount is typically fulfilled by submitting two documents with odometer readings dated within 30 days of each other, for example the free “safety inspection,” plus a smog check, or an oil change. On the document the shop provides you will be the odometer reading and vehicle identification number, or “VIN” number of your vehicle.

In addition to miles driven, Californians are primarily rated on driving records and claims history, (POI and BI limits are not “technically” used there) and they are offered two very large discounts in addition to the standard ones:

Good Driver & Safe Driver

“Good Driver” discount is offered when the driver has no more than one violation in the last three years. The discount is as much as 30%, so be sure to take traffic school options when they are offered to you, because having a second violation will increase your rates for up to three years, or until your oldest violation drops off, whichever comes first. Accidents may also involve violations, and could cost you both discounts.

“Safe Driver” is another very large discount, again up to 30%, but it is only offered to those who have no “at-fault” accidents on their records in the last five years. This is one circumstance that you will want to ensure that any claim you submit for damages is not listed as an “at-fault” occurrence unless it actually was. Uninsured motorist and comprehensive claims usually do not count against you.

▪ Your strategy here is to make sure that you qualify (and stay qualified) for both of these discounts, as long as you will be driving in CA ▪

 ▪ Duration of Ownership ▪

“Are you the original owner of the vehicle? How long have you owned the car?”

Some states also rate on “duration of ownership” of a particular vehicle. Arizona is one state that uses this factor. As with most discount questions, more is better, and the maximum discount is given for having owned the vehicle for two or more years, with “original” ownership. Obviously if you claim you are the original owner of a 20 year-old car, who just happens to be 18 years old— you are probably not going to get this discount.

▪ The Marriage Discount ▪

“Are you married or single? Divorced or widowed?”

Yes, being a married person is considered a rating factor in calculating auto insurance rates. Perhaps married people get fewer tickets, file fewer claims, or both, who can say, but with most companies in almost every state two married people will pay less on the same policy than two unrelated adults. That I know of, this discount is seldom if ever verified— the logistics of doing so would be horrifying.

Nobody has ever told me that they were asked to mail in a marriage certificate or other document, unless perhaps they set up their policy as unmarried, and then tried to switch it after the fact.

Some states allow (or require) that this discount be offered to “domestic partners” whether they are “registered” or not. An agent that you are speaking with may not know of, or care to offer you this discount, so be sure to ask for it if applicable. If needed (and wanted) you could even go down and actually “register” your partnership for a nominal fee at the local courthouse (if domestic partner registration is available in your state).
I believe that this same principle is applied to the other drivers on the policy as well. Drivers who are “related” to each other (by blood or marriage) in the same household are generally given better rates than those who are not. “Relatives” or “children” are rated better than “not related” for example. This claim of relation is not, that I know of, ever verified in any way.

▪ Females are usually rated higher (and charged less premium) than males, so if you are a female with a voice that is not distinctly “feminine,” be sure to mention your gender if you are doing a phone quote ▪

▪ The Claims Free Discount ▪

“Have you or anyone in your household filed a claim in the last five years?”

The answer may or may not be yes, but if you say “yes,” you will definitely not get this discount. Once your reports are run, if nothing is found, this discount will put more money (10% or more) back in your pocket. Not every state offers this discount, but if you get asked this question, either online or by an agent, most likely it is available, and you may qualify for it if you answer the question correctly. Be careful with this one in conjunction with the Discovery Truth Indicator, (DTI) as you may be penalized for not disclosing an accident or claim within the last three years (or however long that particular company rates on occurrences).

▪ Return of Premium Credit ▪

Some companies, especially the membership-based ones, will offer an annual or semi-annual “rebate” or “dividend” to you as a reward for safe driving with no claims, or if the company does well as a whole. If you are a high-tiering policyholder with great scoring and maxed-out discounts, (or even if you are not) this may be the last area that you will find the maximum return on your auto insurance premium dollars. Find a company that offers you both the best rate for your coverage, and a return of premium refund, and you will have found the lowest possible cost auto insurance.

▪ The Multi-Line Discount ▪

This may or may not be an actual discount. It is related to the “teaser”   discount in that it is meant to retain you as a customer, and keep you from switching to another company, because, the logic goes, it is always easier and cheaper to have all your policies with the same company, correct? The answer is that it may be, but this is not always so. More often than not, the policies that you purchase from one company will be underwritten by another company specializing in that particular product, and therefore it offers better rates and terms. This is completely logical, but something that is often misunderstood by the insurance buying public.

To put it another way, (to my knowledge) the Ford Motor company does not manufacture windshield wipers, yet all of their products are equipped with them, they are sold to you by Ford, and presumably are warranted the same as the other car parts that are actually made by Ford. In this same manner, your car insurance company may offer you a renter’s or motorcycle policy, and may even offer you a “preferred” or “multi-line” discount for buying them, but the reality is that you can usually buy these products yourself from the same company at the same price.

Simply ask, or check into who the policy will actually be “underwritten” by. Is it the same company that the auto policy is with? Usually it is not. In a way, it is like getting something “free” if you buy a product that you probably would not have purchased otherwise. For this kind of discount to matter to you, it must be a true savings, for products that you would have purchased anyway, or already have and are shopping their renewal as well.

Otherwise, keep your auto insurance in its own file, and your renter’s policy, (homeowner’s, motorcycle, etc.) in another, and shop them accordingly, on their own merits, at each renewal. Over a lifetime of purchasing property and casualty insurance products, this may be your most valuable course of action, and the one that consistently delivers measurable results. You must be willing to invest an hour or two of your time at each policy renewal, or if that is too valuable to waste, have someone else to do the “leg” or “web” work on your behalf. Remember that a discount is not a discount if it costs you more money than it “saves” you.

Some companies may offer you additional “credits” for having other lines of business with them, as opposed to “discounts,” because discounts are tightly regulated, and credits are much less so. Whatever the name, the effect is the same, and the result is a lower rate on your auto insurance, in exchange for spending more money elsewhere.

The Future Effective Date ▪

This discount is offered as an incentive to get you to buy your policy before you actually need it. That is, buying your policy today with an effective date in the “future” will be cheaper than buying the policy effective today. It is not always available, and it is often overlooked by both policy holders and agents alike. If it is offered in your state, it may be as much as 5%. The real trick to this one is that the “future effective date” can be as early as a few hours or minutes from now!

Therefore if you do not absolutely “need” your policy to start today (and if you already have coverage for today) check the price if you set the start date in the “future” (tonight at one minute past midnight), and this sweet little discount might surprise you. Of course, if you are working with an agent, you could simply ask if the discount is available, or if the price would be different tomorrow than it is today. Again, the agent may not know about this discount, and if she does, she may not offer it to you for fear that you will not buy your policy today, right now.
You can pay for and bind the coverage on a specific day, (today) but so long as your policy does not start that same day you will keep this discount. If you know for a fact that this discount is offered, make sure that you calendar your policy renewals so that you can always bind your new policy at least a day before you actually need it to start.

 ▪ The Good Student Discount ▪

“Are you in school now? Or have you been in school in the last 12 months? Full time or part-time? Did you (or the driver in question) maintain a 3.0 or better GPA?”

These are the questions asked to determine if you are eligible for this substantial (generally 10%) discount for each driver rating factor that it may apply to. It is generally only applied to drivers under the age of 25, and it applies to each driver on the policy in that category. Full time students maintaining a “B” average (3.0) may receive this discount. Many people (and agents!) do not know, however, that it also applies to students who may have left school within the last 12 months, to allow them to continue receiving the discount during the summer months, and during breaks in their education. Like many other discounts, it is seldom if ever verified, although it might be.

Be sure to claim this discount for each driver on the policy if they qualify for it. A “driver training” discount may also be available, (see “Defensive Driver Discount,”).

▪ The Away At School Discount ▪

If your child will be attending school more than 100 miles from your home, and will not have a vehicle with them, you may be able to claim this discount. It is typically around 5%, and will of course only apply if you have the child on the policy in the first place. If you have removed them from the policy because they do not live at home, then there is no premium charge to discount.

▪ Level of Education ▪

“Are you a high school graduate or equivalent?”

Related to the student discount, this question about “level of education” is asked because (we are told) there is a relationship between the amount of “book learning” a policy-holder may have, and the amount of claims they may potentially file. The less education, the more claims. Perhaps this one is a penalty for simply admitting that you are not a high school graduate or equivalent, because you will be surcharged in many states if you do admit to this.

Beyond high school, additional fractional discounts may apply for educational level achieved, from “some college,” to “associate degree,” “bachelor degree,” and finally up to “graduate or doctoral degree.” Where this discount is applicable, more education is always better.

The “equivalent” of a high school education is precisely difficult to determine. Should a 44 year-old who has been working hard for 25 years at raising his family and paying his taxes qualify as a high school graduate or equivalent? One might even say that this man is a graduate of the “School of Hard Knocks.” Of course, having a GED, trade school certificate, or “Proficiency Exam” type certification typically qualifies for this as well.

▪ Your strategy here is to carefully determine whether or not you have the “equivalent” of a high school education when you answer this question.

 Occupation

“What kind of work do you do? Or do you have a degree or certificate in a particular occupation?”

Very few states actually allow this discount— California and Colorado immediately come to mind. If it applies to you, remember that it is very powerful, as much as 10% or more, so make sure that you answer this question carefully. The more “technical” or “scientific” your occupation, the higher the discount. Doctors, scientists, and information technology workers will receive the highest discounts (where offered) for “occupation.”
Engineers, Craftsmen, and “licensed professionals” also receive high discounts here, (employed or not!) so if you believe you qualify for this discount there is certainly no harm in claiming it. Also, this discount is seldom if ever “verified.” Even if you are unemployed, or “not currently working” right now, your degree or certificate in your occupation may qualify you for this discount.

However, if you are 18 years old, and claim to be a “medical doctor,” do not expect to obtain this discount without verification ▪

▪ Emergency Roadside Assistance ▪

 “Do you have AAA, or other roadside assistance?”

I have only seen this discount offered in one state, California. Apparently, those who maintain roadside assistance coverage are better “risks” that will generate fewer claims than those who do not have such a membership. In that state, though, it is a very powerful discount, usually about 10%, so on a $ 1000 policy this savings will be about $ 100 per policy term, (six months) or $ 200 per year, easily exceeding the cost of an actual “AAA” membership.

AAA memberships start at about $ 60 per year, so if your discount (over 12 months) exceeds this amount, you will be getting cheaper auto insurance, and an AAA membership for nothing, if you claim this discount. It will be verified, usually immediately, so be prepared with your membership number when prompted.

▪ Accident Prevention or Defensive Driver Training ▪

“Have you completed an approved driver improvement course?”

Several states offer this discount in one form or another. Related to it are the “mature driver” improvement course, and the “drug/ alcohol awareness” course. “Classroom taught” driver training for youthful drivers also qualifies. All of these offer some sort of ongoing discount, but most require the submission of the original completion certificate or other verification to actually receive the discount. NJ and NY, for example, offer similar versions of this discount, and in NY, it is as much as 10% off the liability side of your policy, a substantial amount in those pricy insurance markets.

Additionally, regarding the NY “Accident Prevention” course discount, you will continue to receive the discount for 36 months! This will certainly add up to hundreds, if not thousands, over three years. After three years, simply repeat the class, and keep the discount perpetually. The course is offered online, takes about six hours, and costs about $ 30!

The actual course requirements and eligibility for each will vary by state, so you will need to first identify which if any is offered, then do a quick online search for the “approved” or “certified” locations that offer it. Many are offered online and can be completed at your own pace. Some may even take motor vehicle and/ or insurance underwriting points off of your record. Either way, if this discount is offered, it is a win for you (and all eligible drivers on your policy) if you (or they) take it.

▪ The PayPal Discount ▪

“Do you have, or have you ever started a PayPal account?”

This is a so-called “Affinity Discount” similar to that offered to AAA members. It is typically about 10%, so if you are asked this question it most likely is available. If you don’t technically have one, you could always start one for free, then your answer would accurately be yes. If you have had one in the past, but “don’t remember” your account information, you may still qualify for this discount. It typically applies to all the drivers on the policy, so if any driver has ever had a PayPal account, make sure to ask for this discount.

 ▪ The Military Discount ▪

 “Are you active duty military?”

Louisiana is one state that offers this discount. It can be as much as 25%, but you must be active duty, or the spouse or dependent of someone who is, to claim it. If you do, be prepared to provide verification, as it will most likely be requested. If the discount is not offered to you when you set up your policy, ask for it. You will need to submit a form, including a copy of your orders or PCS documents, but it will definitely be worth your while to do so. You will not receive the discount until you return the documentation, so act quickly to get the most benefit. Very few states offer this discount, although perhaps more should. (See “Deployment Exemption” from POI).

Members of the military are often required to complete a “driver education” course of one kind or another in order to obtain a permit to operate their personal vehicle on base.

They may also have to complete a drug and alcohol course. If you have completed either or both of these, be sure to ask if they fulfill the requirement for getting the “defensive driver” and/ or “drug and alcohol education” discounts.

▪ The Storage Discount ▪

If you have a vehicle on your policy that you (or anyone else) will not be operating for a period of time, but you still want to maintain continuous coverage on it, ask your carrier if this discount is available. You may have to call in and speak to an agent, because even if it is available, it will typically not be something you can select on your insurer’s website. Vehicles that are placed in the “storage condition” may not be driven, must be kept in a “secure location,” and will have their liability coverage reduced to the absolute minimum, especially if they are operated on a public road while “stored.”

Be very careful with this discount, and do not under any circumstance use it to evade paying legitimate premium. If you do, any subsequent claim may be denied, and you may be assessed additional premium after the fact.

It is a very good option for those who “put up” vehicles for the season, as many folks do in cold climates. Why pay premium as if you were driving the vehicle, when in fact you are not? Stored vehicles will typically retain “comprehensive” coverage, so if the barn collapses, the vehicle is stolen/ vandalized, or if a tree falls on it, you will still have physical damage coverage.

“Snowbirds” and others who maintain two residences located at a distance from each other, may find benefit in storing the vehicles in one place while operating those in the other, then reversing the coverages when moving between them. Not all companies offer this discount, so if you live in a cold climate, or maintain multiple residences, look for a carrier that does. The storage discount applies to the stored vehicle only, and may reduce the premium up to 80%.

▪ The Paid In Full Discount ▪

“Would you like to pay in full for your policy?”

This is your last chance to heavily discount your policy. If available, it will be offered at the point of purchase, and it is very powerful. It will range from 2% to 30% and more, so if it is not offered to you, ask about it. Even if you cannot manage the paid in full option this policy term, knowing how much it will be saving you next term will be your incentive to plan ahead for it.

The cruelly ironic aspect of this discount is that it most often benefits those who can least afford it, the ones with the lowest tiers and highest rates. I have seen drivers who were offered very minimal coverage for over $ 300 per month, pay as little as $ 1200 (33% off!) if they paid in full for a six month policy. This discount would of course be in addition to all the other discounts you managed to stack up to the point of actually paying for your policy.

An option usually not offered to you by the insurance company, but one that is frequently available is the “third-party payment” arrangement. A third party, (not you or your insurance company) makes the payment for you using their method of payment. This person is usually a relative, (Mom or Dad?) or a friend. They would have to be on the line with you and the agent to give their permission, and you would then repay them on a private basis.

They would be saving you the amount of the discount by in effect giving you (hopefully) a no or low-interest loan until you repay them. Unused “emergency” credit cards with a 0% interest rate for six months or a year are perfect for this as well. Simply purchase the policy in full with the card, then make six equal payments of the unpaid balance divided by the policy term.

▪ Your strategy here is to pay in full at every renewal if possible, and plan ahead to do so ▪