Customer Loyalty Discount for Car Insurance

When it comes to auto insurance, can loyalty cost you? The answer might surprise you.

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Car insurance loyalty discount: how it works


A loyalty discount is exactly what it sounds like. If you’ve been with your insurance company for a pre-determined period of time, you can receive a discount for your loyalty. Depending on your specific insurer, the discount can grow the longer you’ve been a customer. While this idea makes sense for insurers, this might not be a good idea for an insurance consumer, i.e., you. Let’s explore the pros and cons of customer behavior and loyalty in car insurance so that you can decide if you might save more with a different carrier.


Which companies offer loyalty discounts?


Discount availability depends on state- and insurer-specific guidelines. For example, the “homeowners insurance discount” does not exist in California because the state does not allow homeowner status to be used as a rating factor. Ohio and Maryland do not allow insurance companies to use customer loyalty as a rating factor. Some insurance companies simply don’t offer loyalty discounts if they don’t see the merit in them.

You shouldn’t look for or stay with an insurer simply because they offer a loyalty discount — or any discount, for that matter. Below is a list of auto insurance companies with loyalty discounts. The amount may vary based on insurer-specific rules and state regulations.



How much can you save with a car insurance loyalty discount?


Many see loyalty discounts as a price optimization practice. For example, price optimization entails an insurer offering a longtime customer a 10% discount for their loyalty while raising their rates by 30%. In this case, the discount from the loyalty program hides a net rate increase.

This methodology stems from an algorithm used to measure customers' sensitivity to price changes. Companies believe the longer you’ve been with an insurer, the less likely you are to shop around. Even if you haven’t had any at-fault accidents, filed any claims, and have a good driving record, your rates could increase.



How to keep your car insurance rates low


While the tricks to save on car insurance premiums are beyond the scope of this article, the rule of thumb is to shop around every six months for car insurance. Price optimization aside, it’s important to shop around for car insurance because every company has its own individual pricing approach, and your rate will vary company to company.

If you feel your current insurer is charging you more because you’ve been a loyal customer, enter your zip code below to see car insurance rates from other carriers.



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Ava Lynch
Ava LynchSenior Analyst

Ava worked in the insurance industry as an agent for four-plus years.

Ava currently provides insights and data analysis as one of The Zebra's property and casualty insurance experts. Her work has been featured in publications such as U.S. News & World Report, GasBuddy, Car and Driver, and Yahoo! Finance.

About The Zebra

The Zebra is not an insurance company. We publish data-backed, expert-reviewed resources to help consumers make more informed insurance decisions.

  • The Zebra’s insurance content is written and reviewed for accuracy by licensed insurance agents.

  • The Zebra’s insurance content is not subject to review or alteration by insurance companies or partners.

  • The Zebra’s editorial team operates independently of the company’s partnerships and commercialization interests, publishing unbiased information for consumer benefit.

  • The auto insurance rates published on The Zebra’s pages are based on a comprehensive analysis of car insurance pricing data, evaluating more than 83 million insurance rates from across the United States.