Shopping for car insurance is no one’s favorite task, but it’s the best way to ensure you get the best rates. So how often should you shop for car insurance?
You can shop for car insurance at any time and for a wide variety of reasons. Whether you have gotten a renewal notice and your rates have gone up, you’re unhappy with your current company, or you just want to see if there’s a better deal, comparing car insurance rates is easy. And experts recommend that you do it at least once a year.
- Car insurance rates can change annually or based on your driving record.
- You can shop for a new car insurance policy anytime, not just when you get a renewal notice.
- Adding a driver, like a teenager, to your policy will cause your rates to go up.
Why should you shop for car insurance regularly?
Car insurance companies can raise premiums for a variety of reasons. Sometimes, it’s an overall rate change that affects all customers. Sometimes it’s because of a change in your driving record or other household changes.
Regardless of the reason, rate increases occur on your renewal. For most people, car insurance renews every six months. Not everyone wants or needs to compare car insurance quotes every six months, but regular rate comparisons can make a big difference to your budget.
Why do car insurance rates change?
Car insurance rates change for a variety of reasons. The most common is a change to your driving record. When you have an accident, especially if it’s your fault, your rates will increase for a certain time. A long stretch of clean, safe driving will eventually end with those rates going down.
The type of car you drive also plays a big role in your rates. If you go from driving a 12-year-old sedan to a brand-new SUV, your rates will go up. That’s because the new car has a higher value and repair costs.
However, sometimes car insurance rates go up for reasons that aren’t directly related to you. Car insurance companies calculate rates using many statistics; increases in the cost of parts or the number of claims being filed can result in overall rate hikes affecting all drivers.
Not all car insurance companies weigh things the same way, however. So, if one has seen a rate increase, another might be dropping rates. The only way to be sure is to shop around.
When are the best times to shop for car insurance?
You can shop for car insurance anytime, but there are a few times when it especially makes sense to get car insurance quotes and compare rates.
When your car insurance policy renews
Renewal time is the perfect reminder to look around for different plans. For most drivers, renewal occurs every six months, although some policies have a 12-month term.
If shopping around every six months is too much for you, you may choose one of the twice-yearly renewals as your time to compare rates. If your car insurance renews in, say, February and August, you can choose which of those two months is a better time for you. If you’re always on vacation in August, make February your month to compare rates.
When you move
Insurance companies determine rates based on a variety of factors, and one of those is location. When you move, your rates will change. If you’re moving from a bustling city center to a quiet suburb, your rates may go down because there’s less chance of damage to your car. Things like how you store your vehicle (think parking in a garage vs. on the street) and the crime rate will also play a role in your new rate when you move.
Moving is a busy time, but once you’re settled, take the time to compare car insurance rates. You might find that one company offers particularly good rates in your new ZIP code.
When something changes in your life
Life changes bring rate changes. Got a new car? Expect a change in insurance rates. Whether it’s a used car or brand new from a dealer, your rates will almost certainly change.
Have a teenager that just got their license? Expect a change in insurance rates. Teenagers are much more likely to have an accident, so they cost a lot more to insure.
If you got married recently, bundling your cars together on one policy can save you a lot of money (as can bundling your home insurance), so it’s a good time to shop around.
Other life changes, such as a new job that changes your commute or retirement, can also affect rates, so it pays to shop around.
When you have an accident or get a ticket
A ticket or an accident on your record will affect your rates. The good news is not every insurance company charges the same rates to a driver with a blemish on their driving record.
Since your rates will go up on renewal after the incident, you have some time to compare rates. Shop around ahead of time so that when you get the renewal notice, you can tell immediately whether you need to switch insurance companies to get a better rate.
How to shop for car insurance
It’s never been easier to shop for car insurance. Thanks to online quoting tools, you can easily compare rates in no time from the comfort of your home.
Searching online also allows you to look up smaller, local companies that may be able to better tailor service to you than the big national companies with commercials on TV.
However, before searching, ensure you have the necessary information. You’ll need:
- Year, make and model of every car in the household
- Driver details for every driver in the household
- Your current insurance policy with your coverage listed
- Information on any claims, usually for the past three years
Request quotes from at least three to five companies, and make sure all of the coverage is the same so that you compare apples to apples.
Finally, take a moment to research the reputation of the car insurance companies you’re considering to get the cheapest and best car insurance company for your needs.
