When you let your car insurance auto-renew itself, it is the easiest and best option, but it could also mean you’ll miss out on savings on your car insurance premium.
The duration of car insurance is usually a year, and when it runs out, your insurance provider will auto-renew it for another year, unless you reach out to them before the renewal date and tell them not to.
The good thing about this is that it removes the hassle of remembering to renew and gives you peace of mind knowing that you won’t fall foul of the law by driving without insurance. Auto-renewal being convenient does not mean it has no downsides, because it can end up costing a lot along the line.
If your car insurance provider offers an auto-renew, you’ll get a reminder around three to four weeks before your renewal date. It’s neither mandatory nor compulsory to renew your policy with your existing insurance provider, but many do due to its convenience.
It is important to know that you could be charged more for staying with them even if all is still the same on your policy, which means you could miss out on potential savings on your car insurance premium.
What can affect the cost of my car insurance premium?
Various details are considered by the insurance providers when calculating your premium. If there are any slight changes, your cost of coverage could skyrocket or go down if you renew or switch providers. Here are some factors that can affect your premium:
- Age
- job type
- Home address
- Annual mileage
- value of your car
- previous claims you’ve made
- Driving convictions, such as speeding tickets, accidents, and other violations.
It’s important to know the determining factors used by insurance providers when it comes to calculating your premiums.
How do I know if my insurance provider auto-renews?
Assuming that your insurance provider has already auto-renewed could be bad, so it’s wise to always check your policy terms and conditions; it will say so if it has been auto-renewed. Or, better still, contact your insurance provider directly to ask them.
If it appears that they have not auto-renewed or that your policy has expired, that could mean that you’re driving without insurance, which means you’re uninsured, and that could lead to a hefty fine and a criminal conviction. Your insurance provider should always remind you when your policy is due to expire.
How do I cancel my car insurance renewal?
Before your renewal date, you should let your insurance provider know that you want to cancel your policy, but if you tell them after, it might incur an additional fee, which is an administration fee.
Make sure to follow all instructions set out in your contract on canceling your car insurance. Only the policyholder can be allowed to cancel.
Opting out of renewal can also be done online, but canceling will more likely be done with a phone. When you check with a provider, make sure to make a note of the details, such as the time, date, and name of the person you spoke to, just in case you might need to come back.
How can I lower the cost of my insurance?
When it’s renewal time, these are tips that might help lower the cost of your car insurance.
- Installing alarms, tracking devices, or immobilizers could reduce your premium. Check with your insurance provider to see if there are discounts available.
- As a new driver, adding someone with more experience and a clean driving record as your named driver could reduce your premium. If this isn’t the case, then do not name them as the main driver, as this is called car insurance fronting, and it is illegal.
- If you increase your voluntary excess, then your premium will automatically come down. Before you increase your voluntary excess, make sure to check if you can afford both the voluntary and compulsory excess. You would need to make a claim.
Why should I compare car insurance?
Comparing car insurance happens to be the quickest and easiest way to find the policy that best suits your needs; it might even save you money and stress.
You should not be pressured into accepting your insurance provider’s auto-renewal facility, as it is not mandatory. So, for your next policy renewal, compare and see which will favor you and allow you to save. It will only take a few minutes.
Frequently Asked Questions
Is it better to renew auto insurance?
Renewing your policy with your existing provider is not mandatory. But many people do it because it is convenient for them.
But take note that you could pay additional money simply because you’re still with them, even if nothing was added or removed from your policy, which could result in your own loss of potential savings.
Is it safe to renew insurance online?
Yes, it is safe to use online insurance platforms for the purchase and renewal of car insurance and for raising claims as well. This is completely safe and convenient, as it helps save you time and money and even allows you to renew your policy before it expires.
Can I cancel my auto-renewal?
Yes, you can cancel a car insurance policy anytime, even when you’ve paid for 12 months. But there are other factors to consider, like, if you’ll no longer be driving the car because you’ve sold it, then canceling your car is a perfect choice.
