Blog Car Insurance Renewals : What To Consider Before Renewing Your Policy

Jan 18, 2023

Here’s why you should not let your insurance auto-renew

White car driving down country road

Do you let your car insurance auto-renew, or do you compare other options before signing the dotted line?

Car insurance renewal is an opportunity for drivers to save money and reassess their needs. However, the majority of drivers simply allow it to auto-renew. According to Insurance Business Magazine, 64% (almost two-thirds) of Canadians let this happen.

Failing to take action and compare options when it is time to renew could be costing you hundreds of dollars per year. Ready to take action? Not sure where to start? We’ve got you covered.

The following will provide you with information about how to renew your insurance, things to consider, tips to save, and answers to common questions about the process.

What is a car insurance renewal?

When your policy is up for renewal, you will receive notice in the mail 45-60 days before the closing date. Standard renewals will be one year from the date it became effective. At the end of the term or the expiry date, it will be up for renewal. You will receive your new policy information for the upcoming term with information about your premium.

A few things can happen when you get your notice in the mail :

  • No change : Your rates stay the same.
  • Increase : Your rates increase.
  • Decrease : Your rates decrease.
  • Cancellation : Your insurance is not renewed by your provider.

You also have the option to switch to another Ontario car insurance provider.

Does insurance renew automatically in Ontario?

Most policies renew automatically if you continue to have a good driving record and you make your payments. While there certainly can be instances where no action is required, too many drivers fail to review the information.

Automatic renewals are easy, but they could also be costing you money. Never assume your new plan is the best price or that the coverage meets your needs. When it is time to renew your plan, it is an opportunity to see what other insurers have to offer. A lot can change in a year – you may qualify for new discounts, and you may pay less with another company.

Even if you intend to stay with your current provider, still take the time to check prices. Comparing is the single best way to see what the market has to offer. You may be surprised about how much money you can save.

Can I renew my automobile insurance online?

Depending on who provides your policy, you might be able to renew online. Some companies have implemented digital forms and apps that support auto-renewal. Contact your provider to confirm if these services are available to you.

Why did my insurance go up at renewal?

It’s not uncommon for drivers to see their rates increase, even with a clean record. Here are some reasons why you could see an increase when it is time to renew :

Even if you are claims-free and didn’t have any tickets, your premiums could still increase. They can happen due to increased regional claim activities, insurance fraud, and changes in the market. Checking with an advisor before renewing will help you save every time.

What to consider before renewing your auto insurance

Here are some questions to consider that could impact your car insurance rates for the year :

  • Do you commute? How far do you drive each day? Has your daily driving distance changed recently?
  • Do you use your car for business?
  • Who drives your vehicle? Do you need to remove or add an occasional driver?
  • Have your insurance needs changed? Do you need to increase or decrease limits?
  • Do you have winter tires?
  • Have you added any upgrades to your vehicle (stereo, auto car starter, window tint, aftermarket accessories)?
  • Have you recently upgraded the vehicle security, such as an anti-theft device?

Shop around before you renew to maximize savings

Compare multiple quotes for your vehicle at the same time with ThinkInsure. Our advisors will find you the best coverage at a competitive rate.

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What information do you need to update when it is time for renewal?

Renewal time is also an opportunity to update your information with your insurer, such as :

  • Mailing address : Your postal code impacts the price.
  • Contact information : Ensure your phone number and email address are up to date.
  • Vehicle usage : If you change how you use your vehicle, notify your insurer.
  • Modifications : Any car modifications to your vehicles engine or physical appearance should be reported to your insurer.
  • New drivers : Let your company know of any new drivers in your home that will be using your vehicle.
  • Tickets : You are required to inform them of traffic convictions, license suspensions, and accidents.

What happens with an insurance renewal after the expiry date?

While a renewal after the expiry date is possible, it can be difficult. You may be forced to pay a late fee or face higher costs because of a gap in insurance.

When it is time to renew, it’s important to make your payment on time. If you fail to pay by the expiry date, your insurance could be temporarily suspended or cancelled. You’ll also be driving without insurance

What happens if your car insurance renewal was declined?

In most cases, it is not renewed due to changes in your driving record. If you’ve been involved in an at-fault accident, have been convicted of a major traffic violation, filed too many claims, or have had payment issues, you could see a cancellation or need high-risk auto insurance

Can I change insurance before the renewal date?

Open hatch of SUV with luggage and kids playing in it

Many drivers incorrectly assume they cannot switch before it is time to renew. This is not true - you can switch at any time. However, it may or may not be a good idea depending on your situation, how long you have left on your contract and other factors.

Changing early could result in a penalty or administrative fees. You will also be required to follow the cancellation procedures as outlined in your agreement. Depending on the savings from your new plan, it may or may not make more sense to wait. Switching insurers during the renewal process is simpler, you won’t face penalties, and it’s your best time to take advantage of cost savings.

A car insurance calculator can help you determine if renewing with your current provider is the best decision. It can also help you determine if switching mid-term is the right move to save money.

5 Steps to renew your car insurance

Whether you are getting it through a company or a broker, the car insurance renewal process goes like this :

  1. You receive your notice in the mail : Most insurers will send you a new policy in the mail about 30-60 days before your renewal date.
  2. Review your new terms and premiums : You have the opportunity to review the terms of your new plan for the upcoming year.
  3. You auto-renew : If you are in good standing, no action is required by you, unless you want to make changes.
  4. You pay : You pay your full amount up front or allow the current payment schedule to continue.

How long does it take to renew insurance?

When you call your insurer, renewing your policy be as quick as 5-10 minutes and save you money. Depending on any changes or questions you have, it may be longer. Once you confirm any changes, you’ll receive new documents in 14-30 days.

Insurance renewal FAQs

Insurers will send you a notice in the mail or online when your insurance is nearing expiration. Generally, you will receive this notice 30 days or more before it expires. During this period, you will need to decide whether to renew or compare auto insurance quotes.

To find your insurance renewal date, it will be listed on your policy and proof of insurance.

If you are satisfied with your current insurer, you can complete the renewal before the expiration date. Simply notify them once you receive your notice.

No. Once your insurance expires, you no longer are insured and you are not legally allowed to drive the vehicle. Always take action, renew or cancel it and go with a different company when you receive your renewal notice.

How early you can renew your depends on your insurer. Most companies will allow you to renew 30 to 45 days before expiring. Check your documents to confirm.

Compare before you renew your insurance

Each year you can renew and find more budget-friendly options. Rather than auto-renewing, browse car insurance with multiple providers to see if you can get a better price. It’s your chance to shop around, find a lower payment and ensure you are taking advantage of insurance discounts.