Car Insurance Loyalty Discount: How to Qualify, Potential Savings, and More
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Written byJ.J. Starr
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J.J. Starr is an insurance and personal finance expert who has been writing for Compare.com since 2022. Her work has been published across the web, appearing on sites such as Insurify.
Prior to writing for Compare.com, J.J. was a registered banker and life insurance consultant, holding a Series 6, FINRA, and life insurance license. She also earned a master’s degree in writing from New York University.
J.J. has a passion for helping people save money by explaining complex topics like car insurance in a way that is simple and easy to understand.
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Edited byLequita Westbrooks
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Lequita WestbrooksSenior Editor
Lequita Westbrooks is an insurance editor at Compare.com. Her writing and editing experiences span several industries, including insurance, personal finance, higher education, and more. She excels at explaining complex topics like auto insurance in simple, easy-to-understand language and is passionate about helping readers save money. Lequita graduated from the University of South Florida, where she earned her Bachelor’s degree in English.
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A loyalty discount is a way for car insurance companies to reward long-term customers with lower rates. This discount typically increases the longer you stay with the same insurer. For example, insurers like USAA and Nationwide offer loyalty programs with varying rewards and savings. Progressive offers loyalty perks like accident forgiveness, while American Family provides generational discounts for young drivers.
Savings vary by company and can depend on how long you’ve been with the company. In this article, we dig into all the details to help you understand how loyalty discounts work.
How Much You Can Save With a Loyalty Discount
The amount you can save with a loyalty discount depends on the insurance company and your state. Typically, savings range from 10% to 20% of your insurance premium. But these discount savings aren’t so straightforward.
First, rules and savings vary by state. Second, some insurers advertise related discounts, such as the multi-policy discount, as “loyalty discounts” to give the sense of an additional discount without actually offering specific savings for customer loyalty.
Third, true loyalty discounts can increase proportionally to the time spent with the same insurance company. Finally, insurers may offer loyalty perks in place of or in addition to discounted premiums.
For these reasons, it’s hard to say exactly how much you can save with a loyalty discount.
How to Get a Loyalty Discount
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Different insurers have varying criteria for loyalty discounts. In most cases, you’ll need to maintain continuous coverage with the same company for a specific period of time to qualify for a loyalty discount. This can range from a few months to a year or more.
For example, Wawanesa gives you a discount after one year, while Amica gives a discount only after two years of continuous coverage.
If you decide to switch to a new insurance company, some insurers, like Progressive, will give you a loyalty discount and honor your loyalty to another insurer if you had continuous coverage with that company before making the switch.
With every company we found offering the discount, the rules and discount values differ by state. When available, insurers usually automatically add this discount to your policy if you qualify. But it’s a good idea to contact your insurance agent or customer service to confirm your eligibility and to get the maximum savings.
You can also check your insurer’s website or mobile app or work directly with your agent to add a loyalty discount to your auto policy.
Where to Get a Loyalty Discount
Customer loyalty discounts are relatively common among major car insurance companies, including GEICO, State Farm, and Progressive. Some large insurers offer this perk, but smaller regional companies might as well. If you’ve been with the same company for a few years, check with your insurer to see if you qualify.
Here’s an overview of some companies offering loyalty discounts and how they vary:
Allstate has an automatic 10% discount on car insurance for renewing at the end of each year you’ve been with the company. The company also has savings of up to 25% for bundling multiple insurance products.
American Family offers loyalty and generational discounts for longtime customers, but it doesn’t specify values.
Farmers provides variable savings for staying a customer for more than one year, as well as multi-car and multi-policy discounts.
GEICO includes savings of up to 25% for a multi-car policy. It may also offer variable savings for multi-policy discounts, depending on your state and the products you purchase.
Liberty Mutual offers multi-car, multi-policy, and early shopper discounts. Savings vary by state.
Nationwide offers savings of 5% if you stay with the company for three years and 15% if you’re with it for five years. It also has discounts for multi-car and multi-policy customers with a variable savings rate.
Progressive offers average savings of 5% for bundling and 12% for multi-car policies. The insurer also offers accident forgiveness coverage for customers who have been with the company for five years or more.
State Farm has average savings of 20% for multiple policies or 17% for multiple cars. It may also offer a renewal discount if you maintain an accident-free record.
Travelers includes savings of up to 13% for multi-policy discounts and variable savings for multi-car and continuous coverage.
Wawanesa’s discount amount varies by location and time you’ve been with the company.
USAA’s loyalty programs include membership perks that allow you to earn discounts elsewhere.
At the end of the day, comparing car insurance quotes from several companies will help you get the best auto policy for your needs. It’s a good idea to start with the companies offering the largest loyalty discounts.
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The Best Insurers Offering Loyalty Discounts
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Below are three top insurance companies with standout loyalty programs that reward you over time. Each has a unique approach to rewarding you for loyalty, from Progressive’s milestone-based perks to American Family’s generational discounts and USAA’s exclusive membership benefits.
Here’s a closer look at what each company offers and how you can use its loyalty program.
Progressive
Compare.com Rating: 4.73 out of 5
Progressive has a more complicated loyalty program than competitors, where you can unlock additional benefits by reaching milestones with the company. Here’s a broad overview:
Immediate: Small accident forgiveness
Six months: Continuous insurance discount
One year: Teen driver discount
Five years: Large accident forgiveness
10 years: Priority call routing
20 years: Lifetime renewal guarantee
Drivers who bundle home insurance with auto earn more perks and discounts quickly.
American Family
Compare.com Rating: 4.98 out of 5
Though American Family is mostly vague about its loyalty discount program (the company states that the value of the discount depends on how long you’ve been with the insurer), it provides information about one of its most unique features: generational discounts.
The generational discount awards reduced premiums to teen drivers and young adults whose parents or guardians have policies with the company.
USAA
Compare.com Rating: 4.91 out of 5
One of the best things about USAA’s loyalty program is the perks. The company doesn’t advertise the value of a loyalty discount; instead, it shares the many ways you can save on related purchases. Perks include:
30% discount on Goodyear tires
35% discount on Avis rental cars
Up to 25% off hotel stays
Up to 60% off guided vacations
Deals on NFL tickets
Discounts at Universal Studios
Discounts on cruise travel
Keep in mind that USAA is only available to veterans, active-duty military members, and their immediate families.
How to Maximize Your Loyalty Discount Savings
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Loyalty discounts save you money just for staying with your insurance company, but there are ways to ensure you get the most out of them. Here are some tips to maximize your loyalty discount savings:
Bundle your policies: For more savings, bundle auto insurance and homeowners, renters, or life insurance policies from the same company.
Maintain a clean driving record: Avoid accidents and violations to increase loyalty benefits.
Ask for periodic reviews: Regularly review your policy with your insurer to ensure you get all eligible discounts and have the right coverage for your needs.
Combine with other car insurance discounts: Pair loyalty discounts with safe driver or low-mileage discounts to increase total savings.
Compare quotes often: Gather quotes from several insurers and compare policies based on price and value to get the best deal.
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Other Common Car Insurance Discounts
In addition to loyalty discounts, insurers offer other common savings programs that reward various behaviors with discounts or perks. Here are some to consider:
Renewal discount: Some insurers may give you a discount when you renew your policy, similar to a loyalty benefit.
Multi-car discount: Insure more than one vehicle with the same company to get a discount of up to 25%.
Continuous coverage: Earn this discount if you don’t have any lapses in your recent insurance history. You can also earn extra savings by staying with the same company for a few years (while remaining accident-free).
Vanishing deductible: You can earn an incremental discount on your deductible for every policy term you remain accident-free. Some insurers also refer to this as a diminishing deductible.
Accident forgiveness: Some insurers offer free accident forgiveness when you remain accident-free.
Rate lock: Insurers like Erie offer a rate-lock period to ensure your rate doesn’t increase even if you have incidents, such as an at-fault accident, so long as you remain with the company.
Car Insurance Loyalty Discount FAQs
Loyalty discounts are one of many ways to save on car insurance. Below, we’ve answered common questions to help you understand how to qualify and make the most of this discount.
What’s the maximum loyalty discount percentage?
Most auto insurers don’t publicly advertise the value of loyalty discounts because the discount varies by state. Comparing discounts isn’t straightforward — some insurers combine discounts (e.g., bundling and continuous insurance), while others offer additional perks (e.g., accident forgiveness) to reward your loyalty.
How do you get a loyalty discount?
You typically need to stay with the same auto insurance company for one or more policy terms to get a loyalty discount. You can often add this discount by calling your insurer, using their app, or updating your policy online.
How do you know if you qualify for a loyalty discount?
It depends. Every insurance company has different rules for accessing its loyalty program, so review your policy’s fine print or contact your insurance company to understand how and when you qualify.
Do insurance companies give loyalty discounts?
Yes, many insurance companies offer loyalty discounts. The specifics vary by insurer, but many reward long-term customers with savings after a certain number of policy terms.
Does Progressive have a loyalty discount?
Yes, Progressive offers rewards through its “Loyalty Rewards” program. You can enroll immediately to receive forgiveness for minor accidents. Longtime customers earn additional discounts and benefits, including continuous insurance discounts and priority call routing.
Sources:
Insurance Information Institute, “Nine ways to lower your auto insurance costs,” accessed October 8, 2024.
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J.J. StarrInsurance Writer
J.J. Starr is an insurance and personal finance expert who has been writing for Compare.com since 2022. Her work has been published across the web, appearing on sites such as Insurify.
Prior to writing for Compare.com, J.J. was a registered banker and life insurance consultant, holding a Series 6, FINRA, and life insurance license. She also earned a master’s degree in writing from New York University.
J.J. has a passion for helping people save money by explaining complex topics like car insurance in a way that is simple and easy to understand.
Lequita WestbrooksSenior Editor
Lequita Westbrooks is an insurance editor at Compare.com. Her writing and editing experiences span several industries, including insurance, personal finance, higher education, and more. She excels at explaining complex topics like auto insurance in simple, easy-to-understand language and is passionate about helping readers save money. Lequita graduated from the University of South Florida, where she earned her Bachelor’s degree in English.