Is Your Discount Really Saving You Money?

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Are you one of the 'lucky' consumers who have a great set of discounts with their current auto insurer? If so, then you must be paying the lowest premium out there, right?

Not necessarily.

Not every insurance company offers the same rates and there's no industry standardized starting rate for auto insurance across most of Canada. You can have a policy with seven discounts at company A and think you're getting a great deal, yet at company B you could have two discounts and be paying the same rate — or even less.

Maybe you have what appears to be a 'loyalty' discount on your policy, and fear losing that discount if you switch insurers. Is staying

put your best move? Again, not necessarily. Because rates may vary by hundreds, even thousands of dollars across insurance companies for the same basic policy, you may find that you'll get an even better rate by shopping around, thus rendering your current loyalty discount rates useless.

Contrary to what most consumers believe, the length of time you've been with your current insurance company has absolutely no impact on your rate. You won't necessarily be penalized for changing companies either (however you may be subject to a cancellation fee), so if you're with a company for one policy term, for example, you can always switch if you find a better rate. You don't even have to wait until your renewal date comes around to shop for a better rate. If you find a better rate mid-term, the savings may be worth any cancellation fees you'll have to pay. Do the math first to find out what's the best option for you.

The lesson is simple - it pays to shop around for a better rate on your car insurance, regardless of any discounts you have today with your current insurer. Fortunately, online comparison sites like make shopping easy by allowing you to get quotes from over 30 competing insurers to ensure you get the lowest rate available.