By Susan Tompor Detroit Free Press
Everybody wants a discount on car insurance. Why else would we watch the Esurance TV ads where a crazy lady in the beige turtleneck named Beatrice talks about how she shops for car insurance and how she posts vacation photos to her living room wall instead of mailing the photos to friends, all just to save money?
Sometimes, though, consumers don’t realize of all the discounts they are eligible to receive. Would you expect a break because your car has daytime running lights? Maybe not, yet four of the top 10 insurers offer a discount for daytime running lights, based on a new survey by Bankrate.com.
Daytime running lights are a fairly common feature now. But “you can’t really count on your insurance company to know about the equipment on your car,” said Doug Whiteman, an insurance analyst for Bankrate.com.
Discounts can vary by state based on what state regulators allow, laws in a given state and what some insurers offer in given markets.
Here are five other ideas for saving money:
Watch how many miles you drive in a year.
The Bankrate.com survey noted that eight of 10 major insurers surveyed offer a discount for driving a fewer number of miles each year. But you might need an on-board tracking device.
Insurer USAA offers a discount for low annual mileage in many markets but not Hawaii and North Carolina. USAA said its low-mileage discount would be for below 5,000 miles per year but the discount does vary by age and state. No monitoring is required.
Allstate noted that it rewards drivers in Washington and many other states for low mileage through the its “Drivewise” program. Drivers can choose to install a device to track mileage, hard braking, speed and time of day.
“We know these are factors that contribute to a higher frequency of collisions,” said Shelley Frost, Allstate senior manager of corporate relations. The voluntary program does not cause a premium to go up. Drivers can earn a 10 percent reward for enrolling and activating the device, and up to 30 percent at renewal based on their driving performance.
Consider asking an insurer about discounts if you belong to a college alumni group, fraternity, sorority, professional group or credit union. Some discounts apply if you work for a major company, too.
Look for discounts for anti-theft devices, such as alarm systems.
Such discounts would likely be applied only to your comprehensive premium. So a consumer who does not carry comprehensive coverage on a car, maybe on an older vehicle, is not going to qualify for that discount.
Some discounts aren’t huge, like the daytime running lights discount, and can apply only to some parts of the premium.
Geico notes on its website, for example, that customers could receive a 3 percent discount on certain insurance coverage for daytime running lights. USAA notes that its discount for daytime running lights is generally 3 percent to 5 percent off only the collision coverage, not the entire premium, and the percentage varies by state.
Get a discount for owning a newer vehicle, say a car that is three years old or newer. But pay attention to the car you buy, as some cost more to insure than others.
Pay close attention to your credit history.
Some of the biggest savings, depending on the insurer, can depend on what’s called a credit-based insurance score.
Paying your bills on time and managing your credit can influence your premiums in some way in many states.
“Insurance companies believe that the better your overall financial history, the less likely you are to file an insurance claim, and the more likely you are to pay your insurance premium payments,” said Todd Albery, CEO of Quizzle.com, a Detroit-based provider of free credit reports and scores.
Allstate notes online that it never sees your credit score but it will use elements from your credit history, such as late payments or a missed payment. How long have you been using credit? If you had high credit card balances in the past, are those balances lower now? How many credit card accounts or installment loans do you have? Have you had a foreclosure?
In Michigan, as of January 2013, consumers can ask to have their credit re-run for auto insurance coverage. Based on the result, the premium can go up or down. An insurer is not required to recalculate the insurance more than once in a 12-month period.
Odysseas Papadimitriou, CEO of WalletHub.com, said his company’s research showed that some insurance premiums on average could be reduced 65 percent for someone with an excellent credit history, compared with a person with no credit history.
The WalletHub survey noted that credit data has the least impact on insurance premiums in Vermont (an 18 percent fluctuation) and the greatest impact in the District of Columbia (a 126 percent fluctuation).
Given the mistakes that can go into credit reports, he noted, consumers should review their credit report for any potential mistakes before shopping for car insurance. It wouldn’t help to shop around for premiums, he noted, if you’d get the wrong quote because your credit report is wrong.
More tips on how to save money on car insurance;
Be sure to comparison shop for auto insurance.
Look at the Q-and-A section or blog sections online where some auto insurers spell out discounts.
Review your coverage as your car gets older, too. State Farm notes that as a car’s value decreases, some consumers consider dropping collision and/or comprehensive coverage to save money on premiums.
Some car insurers offer discounts for paying the premium in full at one time or for having payments automatically made electronically.
An insurance company might set a maximum policy discount, regardless of the number of discounts that you might qualify to receive.
Take into consideration any discounts you’d receive if you bundle your home owners insurance and car insurance. Or bundle your boat insurance with your car insurance.
Susan Tompor is the personal finance columnist for the Detroit Free Press. She can be reached at stomporfreepress.com.