Are There Government Discounts for Car Insurance?

By Jessica Bosari
After 13 years in personal and commercial insurance, Jessica Bosari now writes about personal finance, car insurance, risk management and related topics. Since 2008, she has been simplifying complex ideas through engaging articles for her readers.

Are there government discounts for car insurance?

Government workers enjoy many employment benefits, and they can get car insurance discounts as well, saving them up to 10 percent. But contrary to what you might guess, these discounts aren’t given as a special favor. Government employees get car insurance discounts because they tend to be better drivers.

The Only Game in Town for Government Employee Discounts

Only one company advertises discounts for government employees, and that’s GEICO. Did you know that GEICO is short for Government Employee Insurance Company? It was founded by Leo and Lillian Goodwin in 1936. Goodwin realized that if he was to find success with a new business during the Great Depression, he had to target his market very specifically. So, he went for a market with low loss rates and the ability to pay premiums consistently. At a time when many could not find work, government employees had good job security and could buy insurance. GEICO’s tradition of offering discounts to government employees continues, although the company has grown immensely and caters to a wider demographic these days.

How to Get a Government Employee Car Insurance Discount

GEICO offers the Eagle discount to federal government employees who are GS-7 and above, and non-GS employees that are equivalent to GS-11 and above. In addition, if you are a member of one of the following federal agencies listed by GEICO, you should qualify for a member discount:

  • Blacks in Government
  • FAA Managers Association
  • Federal Asian Pacific American Council
  • Federal Law Enforcement Officers Association
  • Federal Managers Association
  • Federal Physicians Association
  • Federally Employed Women
  • National Active and Retired Federal Employees Association
  • National Air Traffic Controllers Association
  • National Association of Assistant United States Attorneys
  • National Association of Thrift Savings Plan
  • National Council of Social Security Management Associations
  • National Federation of Federal Employees
  • National Grants Management Association
  • National Image Inc.
  • National Institutes of Health Recreation & Welfare Association
  • National League of Postmasters
  • Organization of Professional Employees of the U.S. Dept. of Agriculture
  • Patent Office Professional Association
  • Professional Managers Association
  • Senior Executives Association
  • Society of American Indian Government Employees
  • Young Government Leaders

Other Car Insurance Discounts for Government Employees

If you work for the government, you might also qualify for discounts through your credit union. Federal credit unions often collaborate with car insurance companies to offer their members cheaper car insurance premiums. Look for car insurance companies offering “affinity group” discounts and then review the list of participating groups to see if you qualify.

Other Car Insurance Discounts

If GEICO isn’t your cup of tea, there are many other discounts offered by most national car insurance companies. They fall under four main categories.

Vehicle Discounts: These discounts apply to the car itself and special equipment it may carry.

  • Passive restraint systems – Airbags and motorized seatbelts can garner big discounts, as much as 30 percent off.
  • Anti-lock brakes – Cars with anti-lock brakes can save you 10 percent at some companies.
  • Anti-theft devices – You don’t necessarily need an aftermarket system like a car alarm or LoJack to qualify. Having the VIN etched in the car’s glass, and disabling devices sometimes included in new cars can qualify as well. You can save around 10 percent.
  • Newer car – Some companies will give you as much as 30 percent off for having a car that is less than two years old. I guess it makes sense. Who isn’t more careful driving a car they just bought?
  • Multi-car – If you insure several cars with the same company, you can earn a discount.
  • Low mileage – If you drive fewer than a specified number of miles each year, you can earn a discount.
  • Economy cars – Green cars, or those using alternative fuels, can save you 10 percent.
  • Utility discount – If the vehicle is an older utility vehicle, you can save about 15 percent.
  • Farm vehicle – If you use your vehicle mostly for farming or ranching, you can save about 10 percent.

Policy Discounts: These discounts have to do with the number of policies you have with a company or the way you pay for your car insurance.

  • Automatic payments (EFT) – Some companies give you a discount of up to five percent for having automatic payments taken from your checking account. Others simply waive installment fees when you do this.
  • Paperless billing – If you agree to get all your bills and policy documents online, you can save 10 percent or so.
  • Pay in full – Paying your entire premium up front can save you 10 percent at some companies. At others, it just saves you installment fees.
  • Multiple policy or bundle – Carrying several types of insurance with one company, like a combination of auto and home, can save you about 10 percent.
  • Early renewal – Some offer a discount of 10 percent for renewing your policy early.
  • Good payer – You could save five percent at some companies for always paying your bill on time.
  • Switcheroo – Many companies are offering discounts for switching from a competitor.
  • Loyalty – You can earn discounts for staying with a company over many years. The mother of them all comes from Erie Insurance. This company, once you’ve been with them continuously for 15 years, will never surcharge you for an at-fault accident again, assuming your state laws allow it.

Driver Discounts: These discounts have to do with your demographics, such as age or occupation.

  • Retirees – If you’re at least 55 years old and retired from full-time work, you might save 10 percent.
  • Resident students – If your child attends school 100 miles away from home (where you keep your car), you can shave as much as a third off your premium.
  • Good students – Depending on the company, As or Bs can earn discounts of 20 percent or so, for students under age 25.
  • Young drivers – This discount doesn’t make much sense given the notoriously high risks associated with teen drivers, but your kids or grandkids under the age of 19 can get a discount if listed on your policy.
  • Homeowners – Some companies offer a discount if you are a homeowner, whether you insure your home with that company or not.

Safe Driving Discounts: These discounts have to do with your specific driving history.

  • Safe driver – Save as much as 45 percent for your good driving record, depending on the company. Safe driver discounts, predictably, are among the very best.
  • Driver education – Graduating from a driver’s education or defensive driving course can save teens or seniors 10 to 15 percent.

The mix of discounts available depends on the company and the state. Shop around at a few insurers and be sure to ask about specific discounts you might be eligible for when you get your quote. And remember that just because you don’t see a particular discount listed on the company’s web page does not mean they don’t offer it–it (literally) pays to ask and find out.