Does It Pay to Be Loyal to Your Auto Insurance Company?

does it pay to be loyal to your insurance companyLoyalty. It’s ostensibly a virtue that should be cherished above most (or all?) other human qualities. In theory, a person who is loyal to something or someone should reap bountiful rewards for his or her dedication and steadfastness.

But these days, there are many situations where this simply isn’t the case. You can have a checking account at a bank for years, but they might still deny you a car loan or mortgage. You could be a credit card holder with a certain company for a decade, but still see your interest rate jacked up if you miss a payment. And there are countless Americans who have been laid off from a company after working there 20 or 30 years or longer.

In short, the respect and admiration for loyalty isn’t what it used to be. But here’s a little good news: loyalty does count for something in today’s auto insurance industry.

The Value of Loyalty in Car Insurance

It would be great to tell you that the people who work at auto insurance companies are more upstanding, virtuous, and devoted to their customers than those in other occupations. But that wouldn’t really be accurate; the real reason loyalty is rewarded is largely due to the fact that it’s so easy these days for drivers to switch auto insurance companies. Because their customers have the ability to flee to the competition just by spending a few minutes on a computer, smart auto insurance companies try to offer some type of incentive to retain their current policyholders in addition to providing great service.

That incentive usually comes in the form of a loyalty discount. Simply put, after a driver has been with an insurer for a certain length of time, he or she may receive a decrease in their respective policy premiums.

The amount of this type of loyalty discount can vary from company to company, although it can be as much as 10% (or more) of policy premium. Similarly, the amount of time that a policyholder must remain with an insurer in order to qualify for such a discount tends to vary as well. It can be as short as a year or as long as five years depending on the auto insurance provider.

Loyalty Isn’t Always Measured With a Calendar

However, it’s important to note that the term “loyalty discount” doesn’t only revolve around a period of time. It can also refer to an amount of business given to the insurance company.

For example, if you choose to insure two (or more) of your passenger vehicles with a single company, you would usually qualify for a different kind of loyalty discount. Likewise, if you bought your auto coverage from the same firm that insures your boat, motorcycle, or recreational vehicle, you would probably receive a rate cut for your car. And if the company that underwrites your homeowner’s insurance also sells auto policies, chances are you’d get a better deal on your car insurance from it than you would many other places. The idea behind these practices is simple: the more business you give to any one company, the more likely you are to pay less for all of your insurance coverage than you would if you obtained policies from different insurers.

The Key to Loyalty Auto Insurance Discounts

The most important thing to remember about loyalty auto insurance discounts is that you should always ask about them. Sometimes, insurance providers won’t offer these discounts to customers who don’t inquire about them. And you might be surprised at how much you can save just by raising the issue with your agent or firm.

However, if you ever feel that your auto insurance company isn’t properly rewarding you for your loyalty, you can always visit the AIS Insurance website. AIS has the tools to find you an affordable auto coverage quote, which may very well be less than whatever “loyalty discount” you’re currently getting. After all, you never know that you could be paying less for car insurance if you never ask about it, right?

This content is offered for educational purposes only and does not represent contractual agreements. The definitions, terms and coverage’s in a given policy may be different than those suggested here and such policy will be governed by the language contained therein. No warranty or appropriateness for a specific purpose is expressed or implied.

Posted in Cars and Auto Insurance