Glossary
Autopay discount
A small premium reduction some insurers give when you pay by automatic withdrawal from a bank account or card.
Also called: automatic payment discount, EFT discount, electronic funds transfer discount
An autopay discount rewards you for letting the insurer collect payments automatically, usually by electronic funds transfer (EFT) from a checking account and sometimes from a credit or debit card. Insurers offer it because automatic payments cut billing costs and reduce missed payments and cancellations for nonpayment.
The discount is typically small, and terms vary: some insurers apply it only to bank withdrawals, some pair it with paperless billing, and some waive installment fees for autopay instead of discounting the premium. It often sits alongside a paid-in-full discount, which is usually larger, so paying the whole term up front can save more than paying monthly by autopay if your budget allows. The pay in full vs monthly calculator compares the two.
Autopay also protects you from an accidental lapse, since a missed payment can lead to cancellation once the grace period runs out. The risk is on the other side: if your account is short when the draft runs, you may face a returned-payment fee and a cancellation notice. Keep the account funded, check that the amount matches your renewal premium, and update the payment details before you close a bank account or replace a card.
Last reviewed October 4, 2026