When's the Best Time to Buy Car Insurance?
Sometimes, timing is everything. The best time to buy a car? The end of December. The best time to buy a plane ticket? Seventy days before you depart. But when is a good time to buy auto insurance?
Car insurance never goes on sale. There’s no magic month when rates are lower. There’s no wrong time to switch car insurance companies or buy a new policy. But it is possible to save a little extra — and potentially avoid fees — if you time it perfectly.
On average, Compare.com users with proof of prior insurance run a quote for auto insurance 41 days prior to the expiration of their policy. That’s really smart! We’ll tell you why.
When Should You Start Shopping for a New Policy?
Most car insurance policies are just six months long. That enables your insurer to raise your rates rapidly after an accident or a claim (boo). But it also gives you the chance to shop around and even negotiate your premiums (hooray!)
Twice a year, you probably get an email from your car insurance company that says something like this: “Your auto renewal is all set! Thank you for being a valued customer. For your convenience, we’ll automatically process your payment of $XX on DATE.”
This sounds like a done deal, right? It’s not; this message gets sent about a month before your policy actually renews. That means it’s a great time to start shopping around for new car insurance if you’re unhappy with how much you’re paying.
Finding a better deal is easy with Compare.com — it only takes a few minutes to get free, personalized quotes from multiple insurance carriers. Some companies will even give you an early-bird discount if they see that you’re shopping for insurance 2-3 weeks before your policy expiration date.
What Are Some Other Good Times to Switch Car Insurance?
Maybe you have a sneaking suspicion that you’re paying too much for insurance, but you just can’t get motivated to shop for car insurance. Hey, we get it! As much as we love finding great deals on car insurance, it’s not exactly a wild way to spend Saturday night. Here are some ways to get inspired to save.
- Compare auto insurance quotes as part of a personal financial assessment. Is there never enough in your bank account by the 30th of the month? Then it’s time to reduce all your routine expenses, including your car insurance. Consider refinancing auto loans, cutting back on cable/internet, transferring balances to a low-APR credit card, canceling monthly subscriptions and changing car insurance companies. Making all of these moves can save hundreds per month.
- Compare auto insurance quotes after a big life change. Are you getting married, or moving? Is your kid turning 16, or heading to college? These events can all affect your car insurance rates, so it’s smart to shop around.
- Compare auto insurance quotes when you’re buying a new car. Your existing insurance rates will definitely change when you buy a new vehicle. Late-model cars, while safer than older ones, are generally more expensive to insure. You may also want to increase your insurance coverage to protect your shiny new ride.
That’s why you should get a few quotes from different companies to make sure you’re getting a good deal.
Do I Need to Wait for My Policy to Expire to Shop for Auto Insurance?
No! Unlike other service contracts — such as a contract for a home security system —auto insurance policies generally allow you to cancel anytime. If you find a better deal and you’re planning on changing car insurance companies, go ahead and make the switch.
Call your insurer first to find out how to cancel your policy. For some, all you have to do is tell them on the phone. Others want a written request, which simply means writing something like “Please cancel my car insurance policy, #XXXX, as of DATE. I request that you confirm this cancellation in writing, cease all charges for premium payments and refund any unused premiums.”
Some insurers do charge a cancellation fee if you end your policy before the end of the coverage period. The companies that charge a fee — typically around $50, or 10 percent of your remaining premiums — tend to be non-standard insurance carriers, which cater to customers with past accidents, traffic convictions or insurance lapses.
If you’re with one of these fee-charging insurance companies and you’re thinking about switching car insurance mid-policy, just do the math. If your car insurance quotes on Compare.com reveal that you could save $500 by switching, then that’s probably worth paying a one-time $50 fee.
When’s the Right Time to Cancel My Old Auto Insurance?
Let’s say you shop for car insurance on Compare.com and you get a quote that’s $100 less per month than what you’re paying now. Do you call your current insurer right away and say, “see ya later”? No! You need to buy your new policy before you cancel your old one. That’s because having a lapse in your insurance coverage, even if it’s just one day, can raise your rates in the future. It’s better to have some overlap than to risk a lapse.
Whatever you do, don’t just stop paying your car insurance bill. Your insurer is not going to say, “Oh, she must be telling us she wants to cancel.” Nope — they’re going to charge you late fees and may even take you to collections. Shop wisely!