Six-month policies are more common than annual insurance policies, as they allow insurance companies to easily recalculate rates, taking into account routine price reviews and changes in your driving profile. Aside from the length of the policy, there isn't much difference between six-month and 12-month car insurance. Six-month policies allow for a little more flexibility and the opportunity to guarantee lower rates sooner. Twelve-month policies help with budgeting, since policyholders only see increases in rates during the year if they add another vehicle or driver.
A six-month auto insurance policy provides insurers with the opportunity to adjust their rates to cover losses they have incurred at their own risk. This policy term also favors you as a customer. For example, let's say that your record used to include changes for driving recklessly, but recently it improved significantly because you were driving more cautiously. A six-month plan gives you the freedom to find a fair rate based on your current driving record.
Since your current provider wants to keep your business, you might consider reducing your premium for the next six months. Car insurance policies may seem limitless in terms of their coverage options, but their lifespan isn't that long. Most auto insurance policies are active for six months. This is mainly because auto insurance providers can make their vehicle insurance premium rates more competitive.
By dividing auto insurance premium payments into monthly installments, auto insurance companies impose a “convenience” or “installment” rate (the more car insurance premium payments are distributed, the higher the rates that car insurance companies will impose). If you want to make sure you save the most money and, at the same time, get the best car insurance, pay your car insurance premium in full. As a result, they can lower your vehicle insurance premium so that you don't switch to another auto insurance provider that doesn't consider the violation. The car insurance policy holder can also renew a six-month auto insurance policy during those 6 months.
A six-month auto insurance policy is renewed twice a year, while customers with annual car insurance can renew their policies every 12 months. After the six months have passed, your car insurance provider takes the time necessary to make any changes to your vehicle insurance, such as increasing the rate of car insurance premiums after an auto insurance claim or additional limits on vehicle insurance coverage. During a six-month car insurance renewal, you can lower your car insurance premiums if you were a high-risk driver with a lot of driving violations, fines, or accidents in the past. That's because most car insurance policies last six or 12 months, and most car insurance companies offer a discount (up to 20%) for paying the premium in full up front.
If you compared auto insurance premium rates and found that your vehicle insurance is the most competitive for your profile, ask if they offer a one-year car insurance policy. Auto insurance consumers are generally unaware that there are different alternatives to the typical six months of vehicle insurance, although depending on the auto insurance provider, you may find that vehicle insurance companies offer shorter or longer terms. Auto insurance companies review rates at the end of the policy period, so the cost of your insurance coverage may decrease more quickly. With six-month car insurance policies, you pay an agreed amount to cover your car for a fixed period of six months.