Every year, people receive a notice from their car insurance provider. For many people to renew car insurance policy is an automatic thing – the notice is received, a check is sent, and done. Others ignore the notice and their cover will continue anyway. However, it isn’t as automatic for some people particularly if you’re quite frugal. The problem with the new cover is that it usually comes with a higher rate. So before you do nothing or send out a check without giving it a second thought, here are a few things that need to be considered and assessed before renewing car insurance:
Renew car insurance three weeks ahead Those who renew three weeks in advance generally pay much less than those who renew the day before and on the day of the new policy. According to a research for ‘This is Money’ by a comparison website, the reason for this is because insurance providers are preying on those who are in need for a new deal and would most likely pay any premium. In addition, renewing way ahead of time implies financial prudence while buying the day before or on the day itself suggests a greater risk for insurance providers.
Changes in your coverage When it’s almost time for you to renew car insurance policy, you should step back to consider the amount of coverage you currently have. Many people resort to the minimally required coverage, believing it’s all they need. While it’s hard to think of the unexpected things that might happen in the future, being prepared for it financially can reduce the shock factor. You should also find out if you’re paying for redundant coverage. For example, if you have health insurance, why should you be paying additional premium for uninsured motorist coverage if your health insurance can cover your injury expenses?
Optional coverage Another thing worth considering is optional coverage. For example, is it worth it to carry collision insurance if you drive a car of an older make and model? Some drivers slash their collision insurance without much thought in the actual cash value of their automobile when their car loan is paid.
Switching to another insurance provider Some insurers usually charge a higher premium for renewal when they take your claims history into account. You have the option of switching to another insurance provider. But before you do, make sure you make a thorough car insurance comparison. Avoid focusing only on the premium rates; keep in mind the important aspects such as the financial stability of the company, customer relationship, add-ons, etc. when looking for another insurance provider.
Insurance providers know that a percentage of their clients will not go to great lengths of finding a different quote for their insurance policy – whether it’s because of apathy, naivety, or they’re just really well-off. But regularly evaluating your car insurance policy and seeking for an alternative quote for a better deal not only saves you money; it also helps you keep in check of the amount of coverage you have and if it’s enough to keep you safe on the road.