Putting expenses on automatic renewal is an easy way to streamline your finances and make your life less worrisome. Some bills such as streaming TV shows, phone service and auto insurance can be paid automatically without even having to think about them.
That passivity can be dangerous, however. Though you’ll get a monthly bill in the mail or via email, you may be unlikely to look at it since it’s being paid without you having to really think about it. Rates may rise without you realizing it.
If an auto insurance policy automatically renews each year or six months, you could be in for a rate increase before you got the chance to shop around for a new policy elsewhere. There’s nothing to stop you from changing auto insurers in the middle of a policy term, so shopping for insurance is always a good idea.
For an easy reminder on when to shop for auto insurance, there are some life changing events that should be automatic reminders to stop and reevaluate your policy. Even if you decide not to switch insurance companies, these events can be good reminders to look into updating your policy and can lower (or sometimes increase) your premium:
1. You’re married
If you recently got married, shopping for car insurance may be one of the last things on your list of things to do together as a couple. It can pay off if you’re both good drivers.
Married people are less of a risk than single people to auto insurers, and you can save 10 percent while married. Combining policies can lead to more savings by insurers that give discounts for having two or more cars on the same policy.
2. You’re a graduate
Graduating from high school, college or grad school is a good time to shop for insurance for a few reasons.
You’re likely to be less of an insurance risk as a graduate who is able to get a better job and be more responsible. Getting older has its perks, and lower auto insurance is one of them if you’re a good driver.
You may be eligible for insurance discounts after graduating, though they may not be as good as the discounts that students can get. Being a good student with good grades can reduce your premium by 10-30 percent, so that discount may disappear after you graduate.
Graduation is such an important life event that your insurance carrier expects you to notify it about this change. If you don’t, you could be committing insurance fraud.
3. Your child is going to college
At the other end of the graduation spectrum is the time when your child leaves for college, changing your family’s insurance needs.
Your monthly premium will likely drop with one less driver in the house — especially a teen driver — though you may need to keep them on the policy if they return home during school breaks and drive the family car. But even then, your rates should drop.
If the college is more than 100 miles away and the student doesn’t take their car with them, the family premium can drop 10-20 percent. If they’ll have a car on campus, your rates may not drop. A student who is on their parents’ policy will likely have lower insurance rates than they would on their own.
4. Your kid moves home
After college, or even later in life, children who move back home with their parents may look to save money by being added back to their parents’ auto insurance policy. This is unlikely to benefit anyone.
As adults, children living at home with their parents should have their own auto insurance policy if, for nothing else, because their parents’ policy will rise with another driver added to their coverage.
Parents can exclude others living in their home from their insurance coverage. If a resident isn’t listed on the auto policy, then they’re not covered by it.
However, if parents don’t tell their insurer that a child of driving age has moved back home, their insurer may require extra coverage if they find out about it because there’s an assumption that the child will have access to any cars in the family.
5. A brand new car
Buying a new car is a great time to call your insurance company, though not for the best reasons. Insuring a new car will likely cost more than your current car for the simple reason that a new car will be more expensive to repair or replace than an old car.
You may get discounts for added safety features such as blind-spot recognition and lane change assist.
6. Renewal time rolls around
Every six months or every year your auto insurance policy comes up for renewal. You’ll get a notice in the mail, which you may want to ignore if it’s set for automatic renewal and payment.
Don’t ignore it. This is a good time to rethink your insurance needs and compare rates. Even if you don’t have one of the life changing events listed above, a renewal notice is a good reminder to shop around.
If your premium has increased, this can be a perfect time to shop for new rates. Call your insurer and ask why the price increased, and ask if there are discounts that you’re eligible for.
7. You had a bad experience
If you filed a claim with your auto insurer and had a bad experience, or just got lousy customer service over the phone from them, this can be a reminder that there are other insurers out there that may offer you better service at a better price (and our survey can help you figure out what insurers are more likely to offer the services you want).
They may also not be meeting your needs with coverage, giving you an opportunity to shop elsewhere.
Even without lifetime events to remind you to take another look at your auto insurance, there are some things that will be easy reminders to shop around. Who doesn’t like saving money? Shopping for auto insurance is a good opportunity to save some money.