What You Need to Know about Car Insurance Loyalty Rewards

One of the ways that car insurance companies work to bring in new customers is by providing discounts that make premiums more affordable. To keep the customers they gain, most insurance providers offer loyalty discounts after the person has been with them for a period of time.

What You Get

The discounts for loyalty rewards can vary by provider. Some companies offer 15 percent while others offer an amazing 30 percent discount. This results in drastic savings for many long-term customers. However, each program may vary by provider. Some of them require you to remain a customer for three to five years before receiving the discount while others reduce your premiums a little every year.

Is It Enough?

The question customers should ask themselves is if the loyalty discount is enough to make them stay. When they shop around for auto insurance in Salt Lake City or elsewhere, they must weigh more than the one reward to determine if it makes sense to renew their policy or if they should look elsewhere.

First, you need to look past cost to what benefits you receive. No discount can make up for poor customer service. If you don’t have a provider you can rely on and trust in a claim, you don’t want to stay with them.

Second, you need to look at overall savings. Many providers offer multiple discounts, which can add up to more than what you save with the loyalty rewards. Some insurance companies even have base rates that will save you more money than the current rewards program.

Price Optimization

While you may think you are saving money with these rewards, you may be paying more than you should. Price optimization is the practice of reviewing rates to determine price increases. This is often done based on who is more likely to switch providers and who will stay even with an increase in price.

The practice is illegal in some states and others are reviewing it, but it does happen in many areas. The result is that you are paying more for insurance than what you should.

How to Get the Best Rates

Never focus on a single reward or discount or even the base rate for your insurance policy. Instead, get basic quotes from insurance providers and find out what other discounts are available and for how much. Once you get all of this information, you can make an informed choice.

While price matters, consider other aspects of having an insurance policy, such as customer service and how financially sound the company is. Even when you find an insurance provider for your current needs, be willing to compare rates again in another six months or year. Rates are constantly changing and you never know who will offer the best deal the next time you are ready to renew.

Loyalty rewards are just one way to save money on your car insurance, but don’t overlook the other ways that can lower your premiums.

ASA Insurance provides excellent coverage for car and home insurance in the Salt Lake City area with the lowest rates to the English and Spanish communities. Affordable rates and superior service for all home, auto and business/commercial insurance needs.

Asa Insurance provides excellent coverage for auto insurance in the Salt Lake City area with the lowest rates to the English and Spanish communities. Affordable rates and superior service for all home, auto and business/commercial insurance needs.