’)If you’re wondering how to save money on auto insurance, look no further than your car safety service device. If you subscribe to OnStar services and drive less than 20,000 miles annually, you may be eligible for a lower premium on your car insurance.
Studies show that the average driver drives about 20,000 miles a year or more. But many people drive far less than that. This can be difficult to gauge for an insurance company, but for drivers with OnStar services, the amount of miles they drive can be determined and uploaded to a database that insurance companies have access to when building quotes. If OnStar says you’ve driven less than 20,000 miles, many insurance companies like GMAC will reward you with a discount.
Contrary to the fact that other high-tech gadgets and gizmos in your car often increase your insurance premium (they increase the risk of theft); the OnStar device actually lowers your insurance rate for a couple of reasons: the Low Mileage Discount Program and its ability to serve as an anti-theft device.
How Much Can I Save?
Discounts vary by insurance agency, but on average, you can save 15% if you travel 15,000 miles or less a year, 25% if your mileage is under 10,000 and a whopping 40% if you only drive 5,000 miles or less each year. Currently just a few insurance companies participate in the Low Mileage Discount Program, but more are expected to join the bandwagon soon.
Self employed people who work from home, retirees and people who use public transportation frequently are among those who often qualify for the low-mileage discounts. If you fall into one of these categories, look to see if your insurance company offers discounts for the Low Mileage Discount Program.
Other Ways to Save with OnStar
Some insurance companies consider OnStar an anti-theft device, and offer a discount for that as well. These include:
• GMAC Insurance
• Liberty Mutual
• High Point Auto Insurance
Not all states offer the anti-theft discount, so check with your local insurance agency to see if you can qualify.
How Do I Save?
If you’re not sure how many miles you drive annually, do a quick calculation. Determine how many miles you drive to school or work each weekday. Multiply that times 52. Add in any long-distance trips, trips to run errands and miscellaneous miles and get a rough estimate. If it’s under 20,000 for the year, you deserve a discount!
Next, get your auto insurance quote and indicate that you use OnStar. Once you sign up for car insurance with a provider, the insurer will notify OnStar that you’re participating in the Low Mileage Discount Program. OnStar will then give your insurer a monthly odometer reading so the insurance company can verify the miles you actually drive.
At this point, you don’t need to do anything else but drive (or don’t). Your insurance company gives you the discounted rate, and you spend that money on something else like a family vacation!
