Drivers who automatically renew their car insurance without considering coverage changes or even company changes are at a disadvantage. Your renewal is the perfect time to consider making appropriate changes to your coverage and addressing any rate increases that may be taking effect. Auto insurers used to offer a renewal discount and decrease comprehensive and collision rates each year your vehicle got older. Unfortunately, nowadays, such is not the case.
- Liability Limits – If your policy limits have been only the mandatory limits required in your state, and you haven’t been in an accident, congratulations. But if you’ve been in an at-fault accident and found that your liability limits were barely enough to pay expenses for the other party’s injuries, now is the time to increase them. You may be pleasantly surprised to learn that increasing your limits to only the next level is not that expensive and well worth the money
- Coverage Changes – When you are about to renew your car insurance, step back and consider if you have the proper coverages. You may even find that you are paying for redundant coverages. This is a great time to either call or visit with your broker. Ask them to make recommendations that you may not have considered during the previous policy term. For example, if your collision coverage will pay if your car is hit by an uninsured driver, why are you paying for uninsured motorist property damage to protect your car as well? You should ask about uninsured motorist bodily injury. If you are carrying health insurance or on Medicare, why are you paying additional premium for uninsured motorist coverage when health insurance and Medicare will also pay for your injury expenses?
- Optional Coverages – While considering your renewal offer, it’s also the perfect time to ask about optional coverages you may or may not be carrying. For example, if you have an auto club membership, why are you carrying roadside assistance on your car insurance? If you drive an older make car that is paid for, is it worth your while to carry collision insurance? Many drivers automatically drop collision coverage when their car loan is paid without taking the time to investigate the actual cash value of their vehicle. Again, call or visit your Freeway Insurance advisor to help you determine if this is the smartest decision financially and to get an updated auto insurance quote.
- Company Change – Most auto insurers will provide their policyholders a 45-day notice of renewal. This gives you plenty of time to consider whether your company has provided acceptable customer service or handled a claim quickly and fairly. If you’re concerned about either issue, consider asking your broker to place your business elsewhere. An insurance policy is just a contract until it comes time to pay your claim. If your claim was not handled properly or your service expectations have not been met, it’s probably a good time to move on and get an alternative auto insurance quote.
- Insurance Rates – Car insurers can only change rates at renewal. This is good news for customers with an annual policy they can only be hit with an increase once per year. For those customers with a semi-annual policy, you could be charged with an increase twice per year. If your insurance broker represents multiple companies (most of them do), always ask them to re-quote your business as renewal. Your company could have experienced severe losses in the previous year and are now looking to get those dollars back. Also, if you’ve had a claim payment made during the policy term, this is when the company is going to take back “safe-driver” discounts AND surcharge you for the claim. Shopping for car insurance has never been easier, so go online before you grudgingly write that check for your renewal.
Car insurance has become a commodity. It is easy to shop and easy to buy. No longer do we have to make ten phone calls or visit five different agencies to find the best auto insurance quote. Never automatically pay a renewal until you’ve considered your rates, coverage, and service.