What Is the Paid-In-Full Discount?

Most insurers let you choose how you pay for insurance. You could get a paid-in-full discount if you pay your entire premium in advance. Find out more about it here.
Man making car insurance payment

Car insurance companies allow flexibility in how you pay your premium. You can make monthly payments or pay your entire premium with one check. Insurers prefer the latter and reward those who do with the paid-in-full discount.

Your insurance company prefers when you pay this way because it reduces the possibility of missed payments. When your insurer has your money upfront before your effective period, it exposes them to less risk. With less risk comes a lower premium.

This article will explain how paying for your insurance policy in advance qualifies you for paid-in-full discounts. You’ll learn how these work and how much you can save. We’ll also explain the pros and cons of paying your premium in full. Finally, you’ll learn about which companies offer this discount.

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How the Paid-In-Full Discount Works

Insurance can be pretty expensive. Especially if you buy coverage that goes beyond your state’s minimum requirements. But in most cases, you’ll need insurance to drive. Luckily for you, there are plenty of discounts that you can get to lower your rates. They do this by slicing a percentage off of your premium. And you can often qualify for many others to save more.

Paid-in-full discounts are a good way to lower your premium. If you have the money on hand and your insurer offers it, paying upfront is a great way to lower rates. All you’ll need to do is pay in advance for your coverage instead of making monthly payments. The amount you can save depends on your insurer and state. Not available in California.

Paying in full usually means you pay for six months’ worth of car insurance. You may also see insurers call this a semi-annual payment. Other insurers might allow you to pay quarterly. Most providers give you the option to select how you pay when you’re setting up your policy.

Paying-In-Full vs. Making Monthly Payments

There are many reasons why you might want to pay your entire car insurance premium in advance. But there are also some reasons you might prefer monthly billing. Here’s are the pros and cons of paying in full for your car insurance vs. making monthly payments:


  • Less stress. You won’t need to worry about monthly insurance payments if you pay in full. Instead, you’ll be able to lock up your coverage for months. This makes it harder to miss payments as well.
  • Discount. Many insurers offer a discount if you pay your policy in one lump sum. It can help you save a little extra on your rates each billing cycle..


  • You’ll need to pay all of it at one time. One of the negatives of paying in full is that you’ll have to pay the entire cost of your premium all at once. This can amount to hundreds of dollars in a one-time payment. This might be hard to handle if you can’t afford it right away.

Choose the Payment Plan That’s Best for You

The bottom line is that you should go with the payment plan that you feel comfortable. Even so, it’s a good idea to pay in full and take advantage of the savings. You’ll have less worry and receive a discount from your insurance company.

However, paying monthly can also be a smart choice. You won’t have to foot the whole bill right away. You can just pay the smaller monthly increments. This helps you have more money on hand each month. And for some, less anxiety. Insurers also offer a discount for electronic or automatic billing each month. However, they’re usually only for customers that pay monthly.

Which Insurers Reward Customers That Pay in Full?

Many of the top insurance companies incent you to pay your premium in full. But they may offer different savings. They might also run their discount programs in different ways. Here’s a list of major insurers that offer it as well as a look at how their programs work:


Progressive offers a paid-in-full discount. They don’t disclose the exact savings that you’ll receive. This number will likely depend on facts about you, as well as the state that you live in.

Liberty Mutual

You can get a paid-in-full discount from Liberty Mutual. They offer it to customers who pay for their insurance in one or two payments. The insurer don’t list a percentage of savings on its website. This indicates that it’ll depend on you and your state. Be sure to speak with your agent about how much you should expect to save by paying in full.


Travelers also offers a discount for paying for your premium in full. When you’re setting up your policy, make sure to ask your agent how to choose a payment plan that qualifies. You should also ask them about how much you save by making a lump sum payment.


Allstate also encourages customers to pay their entire premiums in advance. The company has what it calls the FullPay® discount. When you’re buying your policy, all you’ll need to do is make sure you pay your entire premium before you policy period begins. Once you do, you should get it.

Farmers Insurance

Another company that offers a paid-in-full discount is Farmers. You’ll get it for paying the whole premium in advance. Farmers doesn’t tell customers upfront about how much they can save. Your agent will likely have more info about how much you’ll save. You should consider asking them about this when you’re setting up your policy with Farmers Insurance.

Erie Insurance

Erie offers a payment perk for paying your insurance policy in one lump sum. This is its version of the paid-in-full discount. It’s perfect for those that prefer paying all at once, this is perfect. Contact Erie for more details.


Dairyland offers a sweet incentive to make an early lump sum premium payment. It’s called the “payment frequency discount”. It’s basically the same thing, but you may select options besides month-to-month or a full payment.


Companies prefer that you pay for an entire insurance policy term up front. When you do, Mercury will give you a paid-in-full discount. If you plan on making a one-time payment each year, be sure to take advantage.

NJM Insurance

New Jersey Manufacturers, or NJM, prefer it when you pay for your premium with a lump sum payment. The company will extend a paid-in-full discount when you do. Savings are usually small, but even small ones add up. Contact NJM for more details.


When you pay your auto insurance balance up front, Amica will give you a paid-in-full discount. There isn’t very much information about it on the insurer’s website. Savings often vary from state-to-state. To learn more about these savings, contact Amica or ask an agent.


Paying your auto insurance by writing one check or making a single online payment can get you a lower premium. Kemper offers a paid-in-full discount for paying this way. Contact Kemper to find out how much you can save when you skip the monthly insurance payments.

The Hanover

The Hanover includes a paid-in-full discount with its account credit discounts. There are few details on the company’s website. So, you’ll need to contact The Hanover to learn more.


Shelter Insurance will take 10% off your auto insurance rates when you pay in full for each policy term. This is the pay-in-full discount. You have the option of paying once a year or every six month term to qualify. Contact Shelter for more details.

Keep in mind that these aren’t the only companies who offer it. They’re just some of the most common insurers that have it available to you. Other insurers might also offer this discount, including local carriers. That’s one reason why you should do a car insurance comparison from time to time. Comparing quotes can help you find better discounts and rates.

How Much Does it Save?

There are a lot of good reasons to pay your insurance policy in full. Getting a discount is at the top of the list. Insurance companies don’t always publish details about them online. Availability and savings vary quite a bit from state to state and person to person. That makes it hard to provide one dollar amount or percentage saved. Savings from a single insurance provider depend on your personal details.

Our research shows that the paid-in-full discount can save you anywhere from 5% to 15%. For instance, Infinity says that its discount can save policyholders between 5% and 11%. Be sure to ask your agent about how much you can save by paying your policy in full.

Frequently Asked Questions

Q: Does paying in full make car insurance cheaper?

A: Your premium will be cheaper and more affordable if your insurer offers a paid-in-full discount. It’s not a massive discount in the way bundling is, but every little bit helps. This discount isn’t offered by every insurance company, though.

So when shopping for auto insurance, ask your agent about pay-in-full savings. Remember that paying-in-full means you’ll be on the hook for the whole premium all at once. Only do it if you can afford to.

Q: How far in advance do you need to pay to qualify?

A: In general, paying in full means buying coverage for six months in advance. Insurers often provide quarterly and monthly payment plans. However, six-month terms is the standard. Some companies even offer 12-month plans. But, it might be a smart idea to consult with your insurer or financial adviser before you make any decisions on how you pay.


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