One way to avoid paying too much for your personal automobile insurance is to assure you are getting all the discounts you deserve. The following are discounts you should inquire about. Some may not be available in all states and from all insurers, but it doesn’t hurt to ask. These discounts may significantly affect your insurance premium.

Ø  “Defensive Driving Discount.” This discount can save you 10 percent on most of the ma­jor coverages under your auto policy, such as liability, medical payments, and collision coverage. Defensive driving courses can cost as little as $25 and last as few as 5 or 6 hours. However, the discount normally applies for 3 years. For example, if your auto in­surance premium is $100 per month, the premium is $3,600 for 3 years. If liability, colli­sion, and medical payments or personal injury protection coverage constitute 85 percent of this $3,600 premium, the resulting premium subject to this discount is $3,060. In this scenario, the actual premium savings would be $306 (10 percent of $3,060) for that 3-year period. To get the true savings, you must deduct the cost of the defensive driving class. If the cost is $26, the savings in this example would be reduced to $280. If you spend 6 hours taking the class, you are earning $47 per hour in savings—not an unpro­ductive way to spend a Saturday!

Ø  “Good Student Discount.” Statistics show that good students tend to be more reliable and mature than students with marginal grades, leading to better driving decisions. Therefore, many states allow a 5 to 10 percent discount if your student driver makes good grades, usually an overall “A” or “B” average in high school or college. If your child has to pay his or her own automobile insurance, this will be another motivator for him or her to make good grades.

Ø  “Home/Car Discount.” Many insurers offer discounts of 10 percent or more if they pro­vide both your homeowners and personal automobile insurance. This can lower your costs on both policies.

Ø  “Auto Safety Features.” Most insurers recognize that owners with cars containing safety features may have fewer accidents and reduced injuries. Many insurers encourage drivers to purchase cars with antilock brakes by giving small discounts for these safety features. Other insurers give discounts for vehicles with airbags, collision avoidance systems, and daytime running lights.

Ø  “Auto Club and Professional Organizations.” Some insurance companies offer auto in­surance discounts if you are a member of AAA or similar organizations.

Ø  “Multicar.” Many insurance companies provide generous discounts up to 15 percent if you have multiple cars on your policy. This reduces the insurance company’s administra­tive costs, on a per-vehicle basis, in issuing the policy.

Ø  “Long-Term Customer.” More insurance companies are offering discounts of 5 to 10 per­cent if you stay with them at least 5 years.

Ø  “Claims-Free Customer.” If you have been insured with the same insurance company for at least 3 years and have not experienced any losses, inquire about a claims-free customer discount. These discounts help insurers retain customers with excellent driving records.

Copyright 2008, 2016, International Risk Management Institute, Inc.