Does Having a Car Alarm Lower Insurance Rates?

Yes, having a car alarm lowers insurance rates because many providers offer car insurance discounts for car alarms and other anti-theft devices. But having a car alarm will only lower car insurance rates if you have comprehensive coverage. You can expect car alarm insurance discounts to be anywhere between 2 and 10 percent off your policy. You can probably save even more money on your coverage by comparing auto insurance quotes online. Get started with our free comparison tool below.

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Rachel Bodine graduated from college with a BA in English. She has since worked as a Feature Writer in the insurance industry and gained a deep knowledge of state and countrywide insurance laws and rates. Her research and writing focus on helping readers understand their insurance coverage and how to find savings. Her expert advice on insurance has been featured on sites like PhotoEnforced, All...

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insurance...

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Reviewed by Leslie Kasperowicz
Farmers CSR for 4 Years

UPDATED: Jun 23, 2021

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Yes, having a car alarm lowers insurance rates because many providers offer car insurance discounts for car alarms and other anti-theft devices. So, if you don’t have one yet, it would be best to look for car alarm installation options. But having a car alarm will only lower car insurance rates if you have comprehensive coverage.

You can expect car alarm insurance discounts to be anywhere between 2 and 10 percent off your policy. You can probably save even more money on your coverage by comparing auto insurance quotes online.

Any car is susceptible to auto theft, which is why having a car alarm in place can help prevent that from happening. But does having a car alarm lower insurance rates?

Today, we’re explaining everything you need to know about the connection between car alarms and insurance rates, including the discounts you can expect from having a car alarm.

Yes, Most of the biggest insurance companies in U.S. offer Discounts for Car Alarms

An older car without any type of car alarm system is more likely to be stolen than a newer car with a car alarm – for obvious reasons.

That’s why most major insurance companies offer a discount for vehicles with car alarms. The majority of car insurance providers in the United States offer discounts specifically for car alarm systems or a vehicle security system.

Of course, not all car insurance companies offer this same car insurance discount. We recommend shopping around to make sure you get the best price for your unique needs.

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You Only Get a Discount on Comprehensive Coverage

Remember that car alarm insurance discounts only apply to your comprehensive coverage – the part of your car insurance that covers car theft, break-ins, and other non-accident-related damages.

Comprehensive coverage is optional in all states. If you don’t have comprehensive coverage, you will not be covered for car theft or break-ins.

Home insurance covers any possessions inside your vehicle. If your possessions are stolen during a vehicle break-in, then you make a claim through your homeowner’s or renter’s insurance – not through your car insurance. For that reason, you may get a small discount on home insurance by getting a car security system.

How Much Of a Discount Can You Get for a Car Alarm?

You can expect to receive a discount of anywhere between 2% and 10% for having a car alarm or vehicle security system.

That could mean saving about $20 to $50 per year off the average car insurance policy (remember, the discount only applies to your comprehensive coverage and not to your policy as a whole).

Of course, discounts vary widely between car insurance companies. Some car insurance companies offer particularly steep discounts for car alarms, while others offer no discounts whatsoever.

Types of Car Alarms and Vehicle Security Systems

When you say “car alarm,” you might think of the loud alarm that goes off when someone hits your vehicle or smashes a windshield. However, this is just one type of car alarm.

With that said, the types of car alarms and vehicle security systems include all of the following:

Passive Car Alarms

A passive car alarm is a type of anti-theft device that comes standard on most new vehicles. This car alarm is what most people think of when they hear “car alarm.”.

It’s a passive car alarm because the driver does not need to activate the car security system himself.  It automatically activates when you lock your car. When you press the lock button on your key fob and walk away, the car passive alarm is automatically activated.

Active Car Alarms

Active car alarms need to be actively armed by the driver. Otherwise, active alarms work similarly to passive alarms: the alarm is sounded when the vehicle detects an intruder or a car thief. Some cars have a separate ‘alarm’ button on the key fob or remote starter that you press to activate the alarm system, for example.

Silent Car Alarms

Silent car alarms can be found on certain newer vehicles. A silent car alarm is triggered by a break-in or similar event, but it activates silently. Some silent alarms send a notification to the car owner’s phone, for example, to confirm that it’s a real break-in and not a false alarm.

Other silent alarms call the owner. The main downside, of course, is that the alarm doesn’t alert people in the vicinity, and it may not scare the thief away.

Advanced Vehicle Security Systems Like OnStar

Newer vehicles have OnStar and other advanced vehicle security systems. These systems can detect a break-in or vehicle theft. They can also shut down the car remotely to aid law enforcement.

Some of the above car alarms are factory car alarms. They’re installed on your vehicle from day one.

Other car alarms are aftermarket alarms. You may install an aftermarket alarm on an older vehicle, for example, to qualify for a car insurance discount and protect your vehicle.

As far as we know, car insurance companies do not provide specific insurance discounts for active, passive, or silent car alarms. As long as your vehicle has an effective security system in place, it should qualify for a car alarm insurance discount.

However, some car insurance companies may provide steeper discounts for advanced OnStar-style security systems.

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Final Word

Car alarms and vehicle security systems reduce the chances that your vehicle will be stolen or broken into. They’re not bulletproof, but they are a proven way to reduce your risk.

Most car insurance companies provide a small discount for having a car alarm. However, this discount will only apply to your comprehensive coverage. You can expect to receive a car insurance discount of about $20 to $50 per year for having a car alarm.

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