Car Insurance Renewal Guide

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Here's what you need to know...
  • The renewal process is usually fairly easy and quick, especially if you want to stay with your current insurance provider
  • However, if you wish to change insurance providers, you need to research and find the best option for your specific needs
  • You can find a new insurance provider through an insurance agent, broker, or online web searches

The majority of car insurance policies are annual policies which means that every 12 months you will have the opportunity to renew your policy with your current insurance provider.

If you are happy with your current insurance policy there isn’t much that you need to do, but there are times when you need to update your policy or change insurance companies.

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What to Do if You Want to Stay with Your Current Provider

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If you are content with your current policy and price, you don’t have too much to worry about or do.

Most companies will give you a month’s notice that your policy is about to be up for its annual renewal. If you do not do anything, your policy will automatically be renewed.

Keep in mind that with your renewal, the price of the policy will usually change as well.

In some instances, your premium may decrease, as some insurance companies reward customers for staying loyal.

Your premium may also go down if you have motor vehicle violations that are old and no longer affect your insurance rate.

If you have had traffic violations in the previous year, you can probably expect that your insurance rate will increase when your renewal is due.

Your premiums may also increase due to general inflation and business practices by the insurance company.

Life Changes

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Even if you plan to stay with your existing insurance provider, it is always a good idea to review your policy.

There are many times when changing your policy is beneficial.

If you have recently gotten married or have a teenager who is starting to drive, adding them to your policy will usually save more money than purchasing a separate policy for them.

You also may find that you don’t need as much insurance as you did previously. If you were carrying full coverage for a new or newer vehicle, you may not need as much coverage as before since your car is older.

The opposite is true if you have recently purchased a new car. Adding certain types of coverage or increasing your limits may be a good idea in order to protect your bottom line.

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Reasons for Renewal Denial

Your car insurance policy is not always automatically renewed. There are situations in which your insurance provider may choose not to renew your policy.

Each car insurance provider has its own policy regarding renewals and when not to renew a policy.

In most cases, you will be denied a renewal because you are considered a high-risk driver.

You may not be denied renewal, but your insurance premium will increase dramatically if you have any of the following:

If your insurance company chooses not to renew your policy it is required to give you advance notice. It varies according to the state you live in, but you will usually be given a notice anywhere from 10 to 30 days.

To find out what the requirements are in your state, check with the National Association of Insurance Commissioners.

A non-renewal of your policy is different from a cancellation. The Insurance Information Institute helps explain the difference between cancellation and non-renewal.

Reasons to Switch to a Different Insurance Provider

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If your current policy is not eligible for renewal, you will need to find a different insurance company. There are a number of additional reasons why you may decide to go with a different insurance company.

  • You may choose to switch companies if you aren’t satisfied with how your existing provider handles claims. If you have had claim denials or have gotten lower settlements than you should have, you may want to find a different provider.
  • You may choose to switch companies because you want a company with more personal attention. Choosing an insurance company with a local office can assure that you will be able to work with someone one on one.
  • You may choose to switch companies because of the price. If you feel that you are paying more for your auto insurance than you should be, you should shop around.

When researching for a new company, be sure to check out their financial stability on a website such as A.M. Best. This website offers ratings for companies based on the future outlook, claims handling, and other factors.

How to Find an Insurance Company

If you are looking for more personal attention in regards to your car insurance, you should use either an insurance agent or broker. Although both can help you find a car insurance policy, there are differences between the two.

  • An agent works for one particular insurance provider, which means that the only products that he or she can offer you are those offered by the insurance company. There usually isn’t as much flexibility in terms of finding a policy with an insurance agent.
  • A broker is able to choose from a number of different insurance providers so there are more alternatives available as well as price points.

Whether your broker has offered a number of different policy options or you are trying to find an agent, one way to make a final decision is to consult other consumers who have had experience with the different insurance providers.

J. D. Power and Associates provides consumer ratings and compares a variety of car insurance companies based on price, what policies are offered, the claims process, billing, and overall satisfaction.

Another way you can search for a new car insurance company is to go online which is usually faster than meeting one on one with a broker or agent.

There are many places, such as this website, where you can put your information in just one time and get quotes from a number of different companies.

How to Switch Insurance Companies

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If you have chosen to insure your vehicle with a different company, there are a couple of ways to cancel the renewal with your current provider.

The best way would be to call the company and let them know that you will be insuring your car with a different provider.

Give them the effective date that you will be starting the new insurance so your policy can end at that point.

Remember that if the insurance company is not informed somehow that you are switching insurance your policy will be automatically renewed for another year.

Paying for the Renewal

If you choose to stay with your current insurance provider, you need to choose how to pay for the renewal.

Most companies offer a variety of ways to pay, either annually, quarterly, or monthly.

  • If you have chosen the monthly option in the past, you will just continue with monthly payments
  • If you pay annually, you will be responsible for the entire amount when the renewal period starts

Speak with an insurance representative or your agent if you want to change how you pay your premium.

To find a new policy and compare car insurance rates, start right here by entering your ZIP in the FREE box!

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