There are several ways of receiving good driver discounts or lower car insurance rates for it. Nearly all insurers would consider you as a good driver if you can keep a clean driving record, free of accidents and traffic violations, for a period of 3 to 5 years, depending on the carrier. The actual discount offered may differ significantly and some companies may offer better vehicle insurance rates instead of discounts. That is why you need to regularly shop around to make sure you get the best prices at the time.
There may be variations in qualification requirements and the way you can get the savings such as getting separate discounts for being claim-free and having no traffic violations. Also, you can potentially qualify for good driver discounts by allowing your insurer to monitor your driving or by completing a defensive driving course. Let’s explore these options below.
Ways to Qualify for Good Driver Discounts
Automobile insurance companies favor good drivers due to their verifiable history of reliability on the roads, indicating a lower likelihood of these policyholders filing claims. However every company has their own way of rewarding these applicants. Here are some of the key qualification requirements.
Clean driving records: A Motor Vehicle Record (MVR) includes accidents and traffic violations and having none of them on your record for 3 to 5 years (depending on the insurer) can qualify you for large discounts. It may seem simple but the way each company looks at these records may be considerably different. To start with, some car insurance companies only look at the last 3 years of records while others look at 5 years. In addition, most companies start offering discounts for each completed year and offer the largest savings when you reach this 3 or 5 year but some companies may offer one discount when you meet their criteria for qualifying years. In addition, some insurers may separate accident-free and traffic violation-free discounts while others offer one good driver discount for both of them. Therefore, discounts may start from 10% and potentially reach up to 30%.
Claim-free discount: Some insurers may offer a little extra discount for not having any claim as well and others may not have any separate discount for it.
Telematics-based discounts: This is where it gets interesting since there are several usage-based programs offered by various companies including State Farm and Progressive. Typically there are no specific qualifications needed to participate in these programs, meaning you can join regardless of your driving history, including recent accidents or being a new or teenage driver. These alternative vehicle insurance solutions utilize a telematics device installed in your vehicle to actively monitor your driving behavior, enabling you to demonstrate your good driving habits in real-time. By avoiding speeding, excessive braking, driving during sensible hours, and maintaining low mileage, you may potentially get savings of up to 30% with this method as well.
Defensive driving courses: In many states, you can potentially earn an extra discount on your insurance premiums by enhancing your driving skills through a defensive driving course. While some states extend this discount to all drivers, it is typically accessible to young drivers and those aged 55 and above. Additionally, drivers might have the option to take this course as an alternative to receiving a point on their license for a traffic violation like speeding. Alternatively, it may offset points on your license, ultimately improving your risk profile in the eyes of auto insurers. This discount is usually between 5 to 10% depending on the state and insurer.
Importance of Keeping your Driving Record Clean
As demonstrated above, good driver auto insurance discounts are among the most substantial discounts available, contingent on maintaining a clean driving record. However, if your record includes at-fault accidents and traffic violations, you not only forfeit the good driver discount but also jeopardize your ability to secure insurance coverage.
Car insurance companies can drop coverage for drivers with a history of numerous accidents and tickets during policy renewals. Additionally, they can impose surcharges for incidents such as at-fault accidents and speeding tickets, or elevate insurance rates for drivers displaying high-risk driving behaviors, operating under the assumption that these behaviors may persist and lead to claims.
Again, as discussed above, you may have options like taking a defensive driving course after a traffic violation, instead of getting a ticket recorded in your MVR. These courses usually are done within a day and are not expensive so you should definitely consider it, given the chance.
Furthermore, it’s essential to recognize that accidents and claims have a significant impact on your vehicle insurance rates, particularly at-fault accidents, which can, on average, lead to a 42% increase in premiums in the United States. Consequently, another prudent strategy for preventing premium hikes is to exercise caution when contemplating small claims.
Imagine a situation where you’ve accidentally scraped your car while exiting your garage. Suppose the damage exceeds your Collision deductible but not substantially. In such a scenario, you have the option to file a claim. However, it’s crucial to carefully consider the auto insurance implications of making that claim over the next 3 to 5 years before proceeding. Since this incident involves isolated damage without involving others or causing injuries, you may be in a position to take a decision on this.
Finally, maintaining a spotless driving record, free of accidents and traffic violations for five consecutive years, can make drivers eligible for Accident Forgiveness benefits. For instance, Progressive and GEICO provide Accident Forgiveness coverage at no additional cost to drivers meeting this qualification, while with other insurance providers, motorists can become eligible for this feature by paying extra premiums. When you have Accident Forgiveness included in your car insurance policy, your insurer commits to forgiving one at-fault accident, ensuring that your rates remain unaffected for one unfortunate incident, after many years of trouble-free driving.
In short, it’s highly advisable to take a proactive approach in managing your driving habits and maintaining a clean record to both secure and retain discounts on your insurance. Additionally, obtaining multiple vehicle insurance quotes at least once a year is essential to ensure you maximize the potential savings for your efforts.