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New Technology That Can Lower Your Car Insurance Costs

Last Updated on January 28, 2026

Today’s vehicles are packed with more technology than ever—smart sensors, connectivity tools, advanced safety systems, and mobile apps that track everything from mileage to driving behavior. What many drivers don’t realize is that these same technologies can also help them save money on car insurance.

Even if you aren’t driving a brand-new EV or high-tech luxury car, you can still benefit. Many savings tools work with older vehicles, and others simply involve using your smartphone. Below are some of the most effective modern technologies that insurers now use to reward safe, responsible driving.

Key Takeaways

Modern technologies like telematics, mobile apps, and connected-car systems can significantly reduce auto insurance premiums.
Safety features such as blind-spot monitoring, ESC, and automatic emergency braking often qualify for insurer discounts.
Usage-based insurance programs reward drivers for safe habits and lower mileage with personalized pricing.
Major insurers increasingly rely on real driving data rather than assumptions, helping many households save substantially.

How Much Can These Technologies Save?

Technology	How it can reduce your rate	Typical discount range*	Best for
Mobile apps	Quoting tools, coaching, rewards programs, and driver monitoring	Often ~5–25%	Drivers comfortable using smartphone tools
Telematics / usage-based insurance (UBI)	Prices you based on your driving (braking, mileage, time of day, phone use)	Often ~5–30% (sometimes more)	Safe drivers, low-mileage drivers, remote workers, retirees
Vehicle safety technology	Discounts for crash-avoidance and stability features	Often small–moderate	Newer vehicles or trims with safety packages
Connected-car data (built-in telemetry)	Uses the vehicle’s sensors instead of a plug-in device	Similar to UBI programs	Drivers with newer connected vehicles
Smart-city & pilot programs	City + insurer initiatives using telematics, traffic data, and rewards	Varies by program	Drivers in participating areas

*Discounts vary by insurer, state, driving profile, and enrollment terms. Always confirm eligibility and whether poor scores can raise rates at renewal.

Quick pick: If you drive under ~8,000–10,000 miles/year, start with usage-based or pay-per-mile. If you have a teen driver, start with a safe-driving app program. If your car has AEB/ESC/blind-spot monitoring, ask for safety-feature discounts even if you skip telematics.

Mobile Apps

Your smartphone is one of the easiest ways to unlock lower insurance premiums. Major insurers now use mobile apps for quotes, driver monitoring, safety training, and rewards programs.

Mobile Phone Quoting – Companies like Progressive offer an app that lets you scan your driver’s license and VIN for accurate, fast quotes. Digitized quoting also reduces errors, meaning fewer “surprises” when the final rate appears.
Steer Clear (State Farm) – The Steer Clear app helps drivers ages 16 to 24 complete lessons, log practice drives, and demonstrate safe habits. Graduates may qualify for discounts of up to 15%.
Safe-Driving Training Apps – Apps like DriveSharp offer brain-training exercises designed to improve reaction time and multitasking skills behind the wheel. These tools can help drivers—especially seniors—become safer drivers, which insurers often reward.

Telematics & Data Tracking Devices

Usage-based insurance (UBI) is one of the biggest modern innovations in auto insurance. Insurers use plug-in devices or mobile apps to measure how safely and how much you drive. In return, you receive personalized rates based on real data—not assumptions.

Before you enroll: Ask whether the program is discount-only or whether a low score can affect your rate at renewal. Also confirm what’s tracked (speed, braking, phone handling, time of day) and whether you can pause tracking or exclude certain trips.

Examples include:

Progressive Snapshot – The Snapshot program tracks your driving habits (braking, speed, mileage) to determine discounts. Safe drivers may save up to 30%.
Allstate Drivewise – Uses a mobile app or connected-car data to score driving behavior, offering cash-back rewards for safe habits.
GEICO DriveEasy – A smartphone-based program that monitors distracted driving, cornering, braking, and mileage.
National General Telematics – Often used for high-risk drivers, offering a path to lower rates by proving safe behavior in real time.

Telematics is especially beneficial for younger drivers, low-mileage commuters, retirees, and anyone who feels traditional insurance ratings don’t reflect their actual risk level.

Vehicle Safety Technology

Many modern vehicle features directly lower insurance premiums. Insurers offer discounts because these technologies reduce the likelihood of collisions and injuries.

Safety feature	What it does	Why insurers like it
Automatic Emergency Braking (AEB)	Brakes automatically to prevent/mitigate a crash	Reduces rear-end collisions and claim severity
Electronic Stability Control (ESC)	Helps prevent loss of control in skids/rollover scenarios	Lowers rollover/spinout losses
Blind-Spot Monitoring	Alerts you to vehicles you can’t easily see	Reduces lane-change and sideswipe accidents
Forward Collision Warning	Warns before an impending frontal collision	Encourages earlier braking/avoidance
Lane Departure Warning / Lane Keep Assist	Warns or nudges you back into lane	Reduces drift-related crashes

Connected-Car Data (Built-In Vehicle Telemetry)

Many newer cars—especially models from GM, Ford, Tesla, Toyota, Hyundai, and Honda—include built-in connectivity systems. These systems can send driving data directly to insurers if you opt in.

Instead of using a plug-in device, the car itself provides anonymized data such as:

Hard braking events
Average speed
Cornering force
Total mileage
Time of day driven

This allows insurers to reward safer drivers instantly and more accurately.

Usage-Based Pilot Programs & Smart-City Initiatives

Across the country, cities and insurers are experimenting with tech-driven pilot programs designed to reduce accidents and reward safe driving behavior. Large-scale initiatives are replacing older, small pilots like New York’s “Drive Smart”—and the concept has expanded nationwide.

Today’s programs often combine:

Telematics data
Traffic pattern analysis
Environmental impact tracking
Reward systems for safe or eco-friendly behavior

These programs are becoming more common as insurers explore ways to tailor rates, reduce accidents, and reward participation.

How to Claim Tech Discounts (Step-by-Step)

List your vehicle’s safety features (AEB, ESC, blind-spot monitoring, lane-keeping, etc.).
Ask your insurer for a “safety equipment” review and confirm each feature is applied to your policy.
Compare UBI vs. pay-per-mile if you drive low miles—both can outperform traditional pricing.
Enroll with a clean baseline: drive normally for the first few weeks and avoid phone handling while driving.
Re-shop at renewal: your telematics score can strengthen quotes with other insurers too.

FAQs

How can new technology actually lower my car insurance premium?

Insurers reward anything that lowers your risk of having a claim. Modern tech—like telematics apps, plug-in devices, connected-car systems, and advanced safety features—helps them see how safely you drive and how often you’re on the road. If your real-world driving shows low mileage and safe habits, many companies will discount your rate, sometimes by 20–40% or more.

What is usage-based insurance (UBI), and is it worth it?

Usage-based insurance (UBI) uses a mobile app, plug-in device, or built-in car telemetry to track your driving—braking, speed, mileage, and time of day. Programs like Progressive Snapshot, Allstate Drivewise, and GEICO DriveEasy then adjust your price based on your actual habits. If you drive safely and don’t rack up a lot of miles, UBI can be one of the fastest ways to earn sizable discounts.

Do modern safety features really get me a discount?

Often, yes. Features like blind-spot monitoring, electronic stability control (ESC), forward collision warning, and automatic emergency braking (AEB) are proven to reduce crashes and injuries. Many insurers offer small to moderate discounts for vehicles equipped with these systems, especially when combined with good crash-test ratings. Ask your insurer which safety features they reward.

Can my smartphone alone help me save on car insurance?

Yes. You don’t need a brand-new car to benefit from tech. Many insurers now run their telematics and safe-driving programs entirely through smartphone apps. These apps can track your driving, provide coaching tips, and offer rewards or discounts for good scores. Others make quoting faster by scanning your license and VIN, reducing errors that can lead to pricing surprises later.

Is sharing my driving data with my insurer safe and optional?

Participation in telematics and connected-car programs is typically optional—you choose whether to enroll. Reputable insurers disclose what they track (speed, braking, mileage, time of day) and how they use it (rating and discounts, not law enforcement). If you’re privacy-conscious, read the program terms carefully and opt in only if you’re comfortable with the data being collected.

Who benefits the most from tech-based insurance discounts?

Safe, consistent drivers who don’t drive a lot tend to benefit the most. That includes low-mileage commuters, retirees, remote workers, parents who want to monitor teen drivers, and anyone with a newer car that has modern safety tech. If you already drive cautiously, technology lets you prove it—and get rewarded instead of paying the same rate as higher-risk drivers.

Final Word

Technology is rapidly changing the auto insurance industry. In the past, only low-mileage drivers could qualify for special discounts. Today, insurers use apps, sensors, telematics, and connected-car systems to offer personalized savings to drivers who prove they are safe, low-risk, and responsible behind the wheel.

If you haven’t explored these options, now is the time. Major insurers like Progressive, GEICO, Allstate, State Farm, and others now offer advanced tools that help customers drive safer and save more money. Many households could pay significantly less using usage-based pricing, and these programs may even help reduce emissions and traffic congestion.

In short: technology isn’t just changing how we drive—it’s changing how we save.