So you did your research and found the perfect car insurance plan at a fair price.  You are just about ready to buy it but pause before you make a final decision.  You aren’t exactly sure whether you should be buying a 6 or 12-month auto insurance policy.  You ask yourself, what are the pros and cons of each option, and does It really matter? 

This is actually a really common question that insurance advisors get asked all the time. Let’s dig deeper into this common auto insurance buying dilemma and see what option best fits you.

There are advantages to each and some drawbacks. If you are eager to start a quote, go right ahead. Enter your zip code and compare Insurance On The Spot direct rates in three or four minutes.

Six or Twelve-Month Auto Insurance Policy

The Benefits of Purchasing a 12-Month Automobile Policy

  • Your Rates are locked in Place for a Full Year

It seems by the week, prices on almost everything are going up, and there’s no exception for insurance. It’s not only inflation that has caused rates to go higher but other factors such as an increase in accidents, largely due to distracted drivers.  With this in mind, you might want to lock in a price for your policy if you think you are getting a really good deal.

In recent years, rates have increased by over $100 on average, per annual policy.  Think about it for a second.  If you just bought a 6-month policy, there is a good chance that insurers will hike your rates up, leaving you with an increased insurance bill.  If you can afford it, paying for an entire 12 months of coverage in most cases will save you money over a six-month policy.

  • You can get a Nice Discount by Paying upfront for a Years Coverage

Most insurers have discounts available for customers who pay their premiums for an entire year.  This way, the insurance carriers can be certain of payment and take the money and invest it.

After all, insurers make hefty investment returns from the proceeds of each policy.  They want as much money upfront so they can invest it and get a higher return on capital, or ROI.  A common discount for paying in advance for a 12-month policy is around 2%.

  • Added Convenience with only One Annual Bill

Today, we are seemingly busier than ever.  The more bills we can eliminate, the more stress we alleviate too.  When you buy a 12-month plan, you cut down on one extra bill midway through the year, making your life a little bit easier.

  • You can Avoid extra fees most insurers Impose by paying your Annually Policy in Full

Often times when you structure your insurance bill in installment payments, you will be charged a processing fee.  This could amount to over $100 or more over the course of the year if you are set up to make monthly payments.  Eliminate these needless charges by getting a twelve-month plan that you pre-pay in advance.

  • You can Eliminate Possible Rate Increases due to Traffic Citations

If you buy a 6-month policy and then get hit with a major traffic infraction like reckless driving, your rates could soar after the end of the six months.  It’s more advantageous to lock in your rate for a full year and not worry about any increases, which you might not be able to afford if you’re on a super tight budget.

Advantages of Buying a 6-month Policy

  • You might find a Better Rate after Your Policy Expires

Although insurance costs have risen nearly every year in the past decade, there are deals out there for those who shop around and can find a good deal or special promotions.  If you feel like you might be able to get a better car insurance deal in a few months, then you should get a shorter policy and leave that window open.

  • Less Money Out-Of-Pocket Upfront

If you don’t have much money and cannot really afford to pay for a twelve-month premium upfront, consider getting a 6-month policy and paying it in full.  While it might be a bit more expensive, you might find a better price when it expires midway through the year anyway. You could also qualify for a small discount for paying your 6-month policy in full.

  • If a Driving Infraction will be taken off your record in the next few Months

If a serious infraction is keeping your insurance bill sky high that will be taken off your record soon, it might be smarter to get a shorter policy.  When it is removed, you can probably get much cheaper automobile insurance. Then, and, at that point, consider getting 12 months of coverage.


If you are a safe driver with an overall good driving record, it makes sense to buy a 12-month automobile insurance policy.  However, the exception to this rule is if you are getting out of a serious infraction soon, that could dramatically lower your cost, making getting a 6-month policy the better choice.

Whatever you choose, make sure to pay the premium in full if you can afford it, so you can qualify for a discount and save on processing fees.  Shop online now with Insurance On the Spot and see how easy saving money on car insurance can be.

The quote is totally free, and there is no obligation to buy a policy. Enter your zip code and answer basic questions. Then you will be matched with the best rates where you live. Check your rates in minutes and save more on quality coverage.