Whether you're shopping for car insurance for yourself or your whole family, having served in the U.S. Armed Forces can provide some additional savings and perks, but much of the car insurance shopping and application processes remain the same. The differences are that you can qualify for special discounts for veterans and obtain insurance through an organization that only caters to military members. At the same time, you can still get access to general discounts and have plenty of options for where you seek coverage. Take a look at what veterans should know about getting car insurance and some tips to save money along the way.
Importance of Car Insurance
Depending on the type of car insurance coverage you have, this important financial product could cover only the damage you cause to other people and their vehicles in an accident, or it may also cover your own vehicle and medical needs. The Insurance Information Institute (III) explains that most states have a requirement for car insurance coverage that includes coverage for damages you cause to others at a minimum. Specific minimum coverage amounts in terms of dollars will apply depending on where you live.
Without car insurance, you can end up in financial trouble if someone sues you for wrecking into them uninsured, and you can face other punishments like losing your license too. But with car insurance, you can simply pay a deductible (often $500 to $1,000) and get the rest paid for by the insurance company. Therefore, auto insurance offers you a good deal of protection and peace of mind for veterans and every other driver.
Looking at Insurance Coverage Levels
If you choose to purchase the minimum coverage in your location, that likely is a liability-only car insurance policy. While it doesn't pay for damage to your own car or yourself, it will cover the medical and property damage costs of the other party you harm in an accident. You might opt for only this policy if you have an old car with little value, but this type of car insurance usually doesn't suffice if you're still paying off a car loan. It also presents a risk to you since you'd need money aside to buy a new car, pay your medical bills or get repairs done.
You can bump up to the most thorough car insurance option if you add comprehensive and collision coverage to the liability component. The collision portion helps you get reimbursement for damage to your car if you collide with something like a car or pothole. The comprehensive portion takes over for non-collision-related damage you might experience from a bad storm, fallen tree or vandalism.
There are additional options like medical payments coverage, personal injury protection, gap insurance and uninsured motorist coverage that may fit your needs as well. Availability can depend on your level of coverage along with state requirements and lender terms. You can usually also add rental car reimbursement and 24/7 roadside assistance.
Insurance Rates and Veteran Status
As a veteran, you'll find that car insurance companies consider the same factors for determining rates as they do for those who aren't prior service members. Factors that can raise car insurance rates include having a poor driving record, living where a lot of accidents or car thefts occur, owning an unsafe or expensive car, being young or male, having a bad credit score and driving more miles annually than most people do. You'll find that a car insurance policy with just liability coverage costs the least, while adding comprehensive and collision coverage can significantly raise your rates.
Your status as a military veteran can help reduce your car insurance premiums through related discount programs. Car insurance companies consider someone as a veteran if they have been on active duty in the past and didn't receive a dishonorable discharge. Some will extend the benefit to past service members who had to leave due to disability as well.
While many discounts are only for people currently performing active-duty military service or acting in the reserves, a few major insurers extend these benefits to past service members. Even better, a military discount can stack on top of general discounts and help others on your policy save money too. Being a veteran might lead to other perks through the insurance company too.
Read More: Will Car Insurance Decrease If My Car Is Paid Off?
Exploring Military Discount Options
GEICO helps veterans, active-duty and reserve service members save as much as 15 percent and doesn't mention any specific minimum length of service to qualify. This insurance company offers a higher maximum 25 percent discount for those who are on active duty and in imminent danger during an emergency deployment. GEICO has a special center dedicated to military members and helps come up with a customized plan that fits your family's needs.
Veterans can also benefit from lower premiums if they sign up for auto insurance through the United Services Automobile Association (USAA), which only caters to past and present service members. While the USAA doesn't specify a discount for veterans, the organization estimates that past and current military personnel could save an average of $707 each year on insurance through them. It also offers discounts on vehicle storage for those who are currently deployed. USAA members can obtain other insurance, banking and investment products too.
Read More: What Are Car Insurance Discounts?
Considering Other Insurance Discount Options
Keep in mind that you have several ways to get discounts beyond using your veteran status. In some cases, you may find you can get lower rates through a company without a specific veteran discount if you can qualify for several general discounts through them. Here are some discounts worth checking into when you start researching car insurance companies:
- Teen and student driver discounts: If you've got a child no older than 22 on your policy, you could get discounts if they meet specific criteria related to their education. Some insurance companies give discounts to teenage drivers who take an approved driver's education course. Many will reward full-time students for getting at least a B in each of their courses as well as provide a discount for college students who leave their insured vehicles at home.
- Policy bundling discounts: Getting your homeowners, life or boat insurance through the same company as your car insurance can lead to significant savings, especially if you qualify for several other discounts too. The same concept applies for having all the vehicles in your household added to the same policy versus going with different insurance companies.
- Continuous coverage discounts: To get the best car insurance rates, you'll want to never let your coverage lapse, even if you do switch companies. You can get discounts on your auto insurance premiums based on how long you've had coverage, and the amount may increase in steps ranging from six months to 20 years. Progressive is one insurance company that uses a tier of continuous coverage perks that include both discounts and benefits like accident forgiveness.
- Safe driving discounts: Just like getting into car accidents and receiving tickets can run up your insurance rates, avoiding these can lead to discounts through your insurance company. Often, your insurer will want to see up to five years of safe and responsible driving before they give you a discount. In addition, you might have an option upfront where the insurance company sends an electronic device that plugs into your vehicle and records specific data about your driving habits. Other discounts may apply if you complete defensive driving classes.
- Online policy management discounts: You can get discounts if you choose the convenient option of obtaining your car insurance and managing the policy online. For example, Allstate has discounts for requesting paperless account documents, signing your policy at least a week in advance and either paying the whole amount at once or setting up auto installments for your premiums. Progressive lets you save on your car insurance simply by using the online quote system versus calling or visiting a local agency.
- Vehicle-related discounts: Whether you've purchased a new car or have one with key safety features, your car insurance company might reward you with discounts. For example, GEICO has several equipment-related discounts for daytime running lights, anti-lock brakes, car theft prevention systems and airbags, and rewards customers who insure new cars.
- Low-mileage driver discounts: If you only occasionally use your car or make short trips, you can get a discount for low mileage. You can also find special insurance programs like the one offered through Nationwide that charges you based on your miles driven.
Read More: What Is Car Insurance for Teens?
Gathering Car and Driver Information
Before moving forward with selecting some car insurance companies to contact for quotes, take some time to gather key information needed for the process. You should have on hand the level of insurance coverage, number of cars and drivers and desired deductible. You'll also need specifics for each car and driver such as each car's vehicle identification number and typical yearly mileage as well as each driver's history, age, driver's license number and prior driving training received.
For companies offering military-specific discounts, you'll likely need to know your military grade and dates of service as well. You'll later submit documentation showing proof of your service.
Getting Quotes for Car Insurance
To find out which insurance company offers the best rates for service members, you'll want to request insurance quotes from several auto insurance companies. The III suggests reaching out to a minimum of three car insurance companies and diversifying based on whether the place uses in-house or independent agents to sell insurance products to customers. For your convenience, you can complete this whole process online, but you can also speak to agents on the phone or in person for a more personal experience. Try searching for insurance comparison tools alongside individual providers.
You can then run your information through an insurance company's free quote tool or a third-party quote aggregator to see what the offered premium amount will be. During this process, you usually get asked questions that can help determine eligibility for further discounts or opportunities to bundle insurance plans to save money. At the end, you may get a notice about expecting a phone call or email from an insurance agent, or you may get an option to go ahead and sign up for the car insurance plan. However, it's worth taking some extra time to compare your quotes before picking a specific insurer.
Choosing Car Insurance for Veterans
When you've obtained at least a few car insurance quotes for companies that may or may not offer veteran discounts, you'll now need to complete the task of doing more research about these options and comparing the pricing and coverage options. Besides looking at cost and exploring the discounts that might apply to you as a veteran or general policyholder, you'll want to make sure that the coverage level quoted both meets your state's requirements and risk tolerance. You should also check the car insurer's reputation through a site like the Better Business Bureau and assess customer satisfaction through reviews online.
Signing Up for Car Insurance
You can usually head back to the chosen insurer's website or contact them by phone to complete the signup process. Although your information was probably saved during the quote step, you might have to provide the same information again, give more details about drivers or vehicles and prove your eligibility for certain discounts. To get a veteran's discount, you may need to show documentation such as a proof of service letter or Veteran ID Card from the Department of Veterans Affairs. You'll usually also need to show that the military discharged you on good terms.
Insurance companies often have you sign policy documents online and pay electronically to start your coverage, but you might fill out paper forms and pay using a check or money order in other cases. You'll tell the insurance company when you want coverage to start, and you should receive insurance cards by that date as long as you've made at least an initial payment and signed all documents. You'll want to keep up with your policy and payments to avoid losing coverage.
Read More: How to Get Auto Insurance After a Lapse in Coverage
- Insurance Information Institute: What Information Do I Need To Give To My Agent or Company?
- Insurance Information Institute: How To Save Money on Car Insurance
- Experian: How to Choose the Right Auto Insurance Policy
- GEICO: Military Car Insurance
- USAA: Auto Insurance Quotes
- GEICO: Car Insurance Discounts - Savings on Auto Insurance
- Progressive: Auto Insurance Discounts
- Nationwide: SmartMiles®
- Insurance Information Institute: What Is Covered by a Basic Auto Insurance Policy?
- Insurance Information Institute: Is It Legal To Drive Without Insurance?
- Insurance Information Institute: What Determines the Price of an Auto Insurance Policy?
- U.S. Department of Veterans Affairs: How To Apply for a Veteran ID Card
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Ashley Donohoe has written about business and technology topics since 2010. Having a Master of Business Administration degree, bookkeeping certification and experience running a small business and doing tax returns, she is knowledgeable about the tax issues individuals and businesses face. Other places featuring her business writing include Zacks, JobHero, LoveToKnow, Bizfluent, Chron and Study.com.