4 Surprising Ways to Save on Auto Insurance

Could they help lower premium costs?

When most of us think of reducing auto insurance rates, some obvious things come to mind, like driving safely, avoiding accidents, and limiting the number of miles driven.

While these behaviors indeed reduce premiums for most drivers, they aren't the only ways to lower insurance costs. There are a few surprising cost-savers you might be eligible for as well; let's take a look at four of them.

1. Earning good credit

When setting premium prices, insurers review a would-be policyholder's credit information to assign them an insurance score. A good insurance score can result in more affordable coverage.

An insurance score is different from a standard credit score used by lenders to determine loan approval. Insurers aren't considering the likelihood of defaulting on debt. Instead, they evaluate key factors on a credit report to develop a profile of a driver and assess the likelihood of a crash.

Although the formulas and processes used to evaluate a credit history differ for insurance scores versus credit scores, many of the same factors are taken into account. For example, favorable factors such as a long credit history, numerous accounts in good standing, and no late payments suggest a lower likelihood of a crash and result in a good insurance score.

2. Working for a specific employer

Many auto insurance companies provide discounts based on employment with a specific company or working for a specific type of employer, such as the federal or state government. People who work at larger companies are more likely to be eligible for an auto insurance discount because of their employment relationship.

Insurers typically list online the employers drivers must work for to save on premiums. It's worth checking these lists for different insurers.

3. Membership in certain organizations

Becoming a member of some organizations can also result in discounts. This might include vehicle-related organizations, such as AAA. But it also may include some that have nothing to do with driving. For example, some insurers provide savings to members of local or national Bar Associations or accounting organizations.

Again, insurers typically list which organizations motorists need to be a member of in order to save on premiums, so check their databases for groups and clubs.

4. Getting good grades

For young drivers, getting good grades can pay off with reduced insurance premiums. Almost all auto insurance companies provide good student discounts. The requirements to earn them vary, but often a B average or higher is necessary.

Not everyone meets grade requirements, works for the right employer, or joins organizations that provide savings on auto insurance. But for those who can take such steps, the savings may be considerable. It's often worth making the effort to score some of these surprising auto insurance discounts and reduce your coverage costs.