Reasons to Review Auto Insurance & Comparison Shop Annually

Typically, a multitude of events unfold within a year. However, drivers often neglect to deeply reflect on these occurrences and their implications for their car insurance. This underscores the significance of reassessing your policy once a year to ensure its continued relevance to your requirements. Moreover, during this process, obtaining several vehicle insurance quotes is advisable to verify whether your existing provider remains competitively priced. Adjustments to your coverage could potentially transform an insurer that was once cost-effective into a more expensive option post-updates.

Developing the habit of thoroughly examining your existing automobile insurance arrangements on an annual basis is an approach recommended by many experts, and renewal periods serve as effective prompts for this practice. Ordinarily, you receive your vehicle insurance renewal notification approximately one month prior to the policy’s expiration, granting you ample opportunity to take action. Once more, it’s advisable to take early initiative, allowing time for contemplation regarding modifications you may wish to implement, exploring alternative choices, and deliberating on whether to switch insurers or maintain your current setup.

Things That Might Happen and Affect Car Insurance

Changes in drivers: One of the first things to make sure is that your policy still covers every driver in your household and you don’t pay premiums for people who left. A new partner, roommate or a child coming of age may need to be added to your policy. Automobile insurers typically like to know the people of driving age in your household so that they can rate and include them in your policy. This makes sure they charge the right premium and all the possible drivers are protected.

Furthermore, things like not notifying your insurer that your child is now at driving age may be considered a material misrepresentation since a teenage driver in the household would significantly increase your premium. That is why you can potentially face a claim denial if such a teenager gets into an accident with your car and your insurer didn’t know about the existence of them.

Changes in vehicles: Often there is a grace period in informing your insurer of your new automobile and the timeline changes depending on the insurer and state. However, it is best to let them know as early as possible if you replaced your current automobile with another one. Also, your insurer probably needs to know if you made any modifications to it. And, if your automobile is aging or you paid off the loan on it, it may be time to consider dropping Collision and Comprehensive coverage.

Change in address: Your zip code is a very influential factor in premium calculations and that is why your vehicle insurance provider needs to know when you moved. It is very important for the validity of insurance that policyholders always give the right address where their vehicles are kept. Giving a different address or not updating the changes in addresses can be construed as a deliberate attempt to fraud the insurer, especially if the address given results in significantly lower car insurance premiums than the one where the automobile is kept.

Changes in coverage requirements: It is important to have the coverage you need before anything happens so that you can make a claim. For example, you may have had an old car that had liability only coverage. When you replace it with a new vehicle, your insurer may extend the existing coverage to the new one automatically because you may have a grace period to report the vehicle changes. However, your new vehicle would only have liability only insurance coverage since that is all you have for the old one. That is why it is important to think what insurance coverage you need now considering the valuation of the replacement auto and add Collision and Comprehensive coverage to protect it for physical damages, if necessary.

Another example, you may have had a separate Roadside Recovery membership with another company and you stopped it. Then, you may want to add Roadside Assistance to your auto insurance so that you have some level of emergency assistance if you are stranded in the middle of the road.

Value of Yearly Vehicle Insurance Comparison Shopping

Often motorists feel they should shop around when they see a significant increase in their car insurance premiums or they are squeezed by financial changes in their circumstances. However, there are many advantages to getting multiple quotes at least annually and make a decision accordingly.

First of all, the automobile insurance market is very fluid. Lately, many innovative products and companies come into the market that one of them may offer a more advantageous coverage and still let you save money. For example, if you are currently considered a high-risk policyholder due to low credit score or having a teenage driver on the policy, you may benefit from usage-based vehicle insurance policies that don’t bundle you in with the rest of people with low credit or teenage drivers but rate you according to vehicle usage and driving patterns monitored by a telematics device.

Another example is that your vehicle usage may have gone down due to working from home a few days a week, retiring, moving closer to work or carpooling. If you think you are driving less than 8,000 miles a year, a pay-per-mile car insurance policy may serve you better now.

Secondly, another equally reputable company may potentially offer you a lower quote for the same coverage and it may be beneficial to switch. So many policyholders make the mistake of thinking that because they get some loyalty discounts from their current insurers the price cannot be beaten. This is often a misguided thought that should not prevent you from shopping around for auto insurance.

Conducting a yearly assessment of your vehicle insurance policy serves to keep you informed about the extent of your coverage and identifies areas where potential gaps exist, which you might consider addressing through buying further coverage. You may even feel you are over-insured and like to drop coverage to save money. Engaging in an annual search for alternative car insurance options can effectively reduce one of the most substantial costs associated with driving. The act of comparing quotes, especially following significant life changes such as relocation or the addition of a new driver to your policy, can assist you in confirming that you’re still securing the best value vehicle insurance.