Buying a 6 or 12 Month Auto Insurance Policy
Should You Buy a Six or Twelve-Month Auto Insurance Policy?
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.
The Benefits of Purchasing a 12-Month Automobile Policy
Your Rates are locked in Place for a Full Year
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
You can Avoid extra fees most insurers Impose by paying your Annually Policy in Full
You can Eliminate Possible Rate Increases due to Traffic Citations
Advantages of Buying a 6-month Policy
You might find a Better Rate after Your Policy Expires
Less Money Out-Of-Pocket Upfront
If a Driving Infraction will be taken off your record in the next few Months
For Save Drivers
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.