Can You Get Cheaper Car Insurance? 12 Things to Know About ‘Discounts’

Better deals are out there, but some discounts turn out to be much less than meets the eye.

Can You Get Cheaper Car Insurance? 12 Things to Know About ‘Discounts’ Photo (cc) by SphotoE

This post comes from Susan Ladika at partner site Insurance.com.

If you’re looking for the best car insurance rates, a 40 percent discount for good students or a 25 percent discount for having more than one policy with the same insurer will probably catch your attention. But when you read the fine print, you may find limits on those eye-opening discounts.

Insurers tend to use such phrases as “save up to 25 percent,” but you may save far less on your car insurance premiums than you initially thought.

Using terms like “up to” and “could save” provide lots of leeway for insurance companies. “What does it actually mean for consumers?” asks John Breyault, a vice president at the National Consumers League.

Because the information is so vague, “it makes it very difficult to compare discounts from different insurance providers,” Breyault says.

“Insurance discounts aren’t like sale items at the department store, where items can be marked 50 percent off, but the original price might have been inflated to begin with,” says Lynne McChristian, Florida representative for the Insurance Information Institute. “Too deep of a discount to one driver would mean another driver would have to pay too much. That’s why individual driving behavior is the key factor affecting what people pay.”

Despite the complexities of car insurance rates and discounts, everyone loves a bargain. But seeking out all the discounts you’re eligible for could be very time-consuming, Breyault says. “You’re left to do all the legwork.” (See “Cheaper car insurance in 8 easy steps.”)

To help, here are 12 secrets about auto insurance discounts.

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