How Often Should You Shop For New Auto Insurance?

There are several reasons why you might want to shop for new auto insurance. Firstly, insurance companies regularly adjust their prices, so shopping around for new insurance on an annual basis can help you save money and become more insurance-savvy. Secondly, life changes such as moving to a new residence, adding a new driver to your policy, or purchasing a new vehicle can impact your insurance rates, making it a good time to reevaluate your coverage. Finally, if your credit score has changed, it's a good idea to shop for new insurance as insurers in most states take your credit score into account when determining your premiums.

When your rates are increasing

If your auto insurance rates are increasing, it's a good idea to shop around for a new policy. Insurance companies regularly adjust their prices, so shopping around can help you save money and become more insurance-savvy. You can switch companies whenever you want, and doing so mid-policy could help you find a more affordable option.

When comparing quotes, be sure to choose the same coverage limits as your current policy to get an accurate price comparison. While it's essential to ensure you're getting the coverage you need, you can also consider accepting a higher auto insurance deductible to lower your monthly premium. Just make sure your deductible is still affordable if you need to file a claim.

Shopping for insurance online is a convenient option, and many insurers offer online quote tools. However, for more complex situations, you may need to speak with an agent. Working with an independent insurance agent could be beneficial as they can help you craft a policy that fits your unique needs and budget.

By shopping around, you can find out if there are more competitive rates available and make an informed decision about whether to switch providers or stick with your current company.

When you're moving to a new area

If you're moving to a new state, you'll need to get a new insurance policy. Car insurance policies don't transfer across state lines for permanent moves because each state has its own insurance laws. You'll typically need to update your vehicle's registration and insurance policy to your new state within 30 to 60 days. Insurance laws, coverage requirements, claims risks, and the cost of living vary by state and can influence car insurance rates.

Even if you're just moving to a new ZIP code within your state, you'll likely experience a rate change when you update your address. Moving to a new residence is a common scenario that should prompt you to reevaluate your car insurance policy.

In addition to the potential rate change, there are other factors to consider when moving to a new area. For example, if your new house or apartment includes a garage, you may pay less for full coverage than if you were parking on the street. This is another reason why homeowners tend to pay less for car insurance coverage.

By shopping around for auto insurance before you move, you can compare rates and find the best coverage for your new location. It's a good idea to start your search early, as this will give you more time to compare quotes and find the right policy for your needs.

When you're insuring a new family member

Life events, such as marriage or a new family member moving in, are a good time to reevaluate your coverage. If the new family member is a licensed driver, you will likely need to add them to your policy. Since each household member's driving record will be factored into the rate, shopping around for quotes can help you find the best deal.

It's worth noting that married couples generally pay 6% less for car insurance than single drivers, as insurance companies perceive them as more financially stable and less likely to file claims. However, if the new family member is a teen driver, you can expect your insurance premiums to increase significantly. Therefore, it's essential to get quotes from multiple insurers and compare rates before making a decision.

Additionally, consider the pros and cons of adding a new family member to your policy versus purchasing a separate auto insurance policy for them. Insurance companies usually require that the people covered under your policy are family members or significant others living at your address. They may also offer discounts if you insure multiple vehicles with them. On the other hand, buying a separate policy for the new family member may be necessary if they don't live with you or if you've reached the maximum number of drivers your insurance company will cover under your personal policy.

In most states, you are allowed to buy car insurance for a family member, but it's important to check with your state and insurance company to understand their specific requirements and limitations.

When you've purchased a new vehicle

If you've purchased a new vehicle, you'll need to get it insured before driving it off the lot. In most cases, you'll want to purchase an insurance plan before buying a new car to ensure you have enough coverage.

If you already have car insurance for another vehicle, you may not need to buy another plan. Most insurance companies offer a short grace period, typically between seven and 30 days, during which your new car is covered. However, this may depend on factors such as the dealership, whether you're buying the new car with a loan, and the insurance company's specific grace period rules. It's important to check with your provider to understand their grace period policy.

If you're buying a vehicle from a dealership, you'll generally need to provide proof of insurance before they allow you to leave with the car. In some cases, you may be able to call an insurance representative to find coverage directly from the dealership. If you already have insurance on a different vehicle, providing proof of that insurance may be sufficient.

When buying insurance for a new vehicle, it's essential to compare quotes from multiple insurers to find the best rate and coverage for your needs. Costs can vary significantly between companies for the same driver and vehicle, so shopping around can help you find a competitive rate. When getting quotes, be sure to know the make, model, and year of the vehicle, as well as the vehicle identification number (VIN) and your expected annual mileage.

If you're financing your new vehicle with a loan, your lender will likely require you to have full coverage insurance, which includes collision and comprehensive coverage, to protect their financial interest. Full coverage insurance will cover the cost of repairs or replacement of your vehicle in various scenarios, including accidents, theft, fire, vandalism, and natural disasters.

Additionally, consider optional coverage types such as gap insurance, new car replacement insurance, rental reimbursement insurance, and roadside assistance insurance, which can provide additional financial protection in specific situations.

Before purchasing a new vehicle, it's a good idea to factor in the cost of insurance to your budget, as insuring a new car will likely be more expensive than insuring an older model due to the higher value and repair costs of newer vehicles.

When you've experienced a personal or financial shift

Personal or financial shifts can be a good reason to shop for new auto insurance. Life changes can affect your insurance rates, and shopping around can help you find a better deal.

Personal shifts that may impact your insurance include changes to your driving record, such as previous incidents now being several years old, or a change in your credit score. Financial shifts could include a change in job, resulting in a decrease in your income or a change in how often you drive.

When you experience a personal or financial shift, it's a good idea to reevaluate your coverage and shop around for a new policy. You can start by gathering quotes from different insurance companies and comparing rates. You can also use an independent insurance agent, who can help you find the best coverage for your new situation.

Additionally, you may want to consider the following when shopping for new auto insurance:

• Your current policy: Evaluate whether your current policy still meets your needs and budget.
• Coverage needs: Determine what type of coverage you require, such as liability, collision, or comprehensive insurance.
• Discount opportunities: Look for insurance companies that offer discounts that apply to your situation, such as good student discounts or safe driver discounts.
• Comparison tools: Utilize online comparison tools or work with an insurance broker to compare rates and coverage options from multiple providers.

Frequently asked questions