What is a multi-vehicle discount and why should you care?

This article has been updated from a previous version.

If you own more than one vehicle, should you insure them with the same company or not?

Most car insurance companies will offer their policyholders what’s known as a multi-vehicle or multi-car discount to insure all the sets of wheels you may own. That discount typically ranges between 10% and 15% off your annual premium.

In general, here’s how it works:

If your household has more than one private passenger vehicle, every eligible driver could get a discount on their policy, provided all policies are with the same insurance company. Usually, those vehicles need to be registered and stored at the same residential address. It doesn’t matter if the vehicles are owned or leased.

Qualifying for a multi-vehicle discount

Different insurance providers will have different eligibility criteria to qualify for a multi-vehicle discount. For instance, some carriers will allow one driver to insure up to five vehicles in their name, while others will limit it to two or three cars.

Your car insurance provider will take a close look at the following factors to determine your premium and whether you qualify for a discount, including:

• Your driving record
• Your insurance history
• Your age, gender, and where you live
• The vehicles to be insured, including the makes and models, what the replacement values are, and the average cost to repair them if you file a claim

If a single primary driver wishes to insure more than one vehicle in their name, your insurance provider will also want to know how the vehicles are used. For example, do you use one or both to commute to work? After all, the less you drive, the cheaper your auto policy will be. On that note, suppose you have two vehicles, and one is more expensive than the other. If you tend to drive the less expensive car most of the time (such as driving to work on weekdays), and the pricier wheels occasionally (going for a spin now and then on weekends), that, too, can save you a few bucks.

Car insurance discounts can add up to substantial savings

Qualifying for a multi-vehicle discount can save you money on your annual premium. And when combined with other discounts insurance providers offer for using winter tires, and bundling an auto and home insurance policy, as well as choosing higher deductibles, those savings can add up.

Since different insurance companies offer different rates that change often, and multi-vehicle discount eligibility and percentages vary between them, do yourself a favour and compare auto insurance policies and premiums from a broad range of providers to get the coverage you need at a price you can afford.