Car Insurance Renewals : What To Consider Before Renewing Your Policy

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 has 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.

Depending on who provides your policy, you might be able to renew it 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.

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 :

• At-fault accidents
• Car insurance claims
• Traffic tickets and convictions
• Adding a new driver
• Increasing coverage limits, such as adding comprehensive insurance.

Even if you are claims-free and don’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.

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 vehicle's 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.

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 an insurance gap.

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

Can I change insurance before the renewal date?

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.

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.