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Is There a Best Time of Year to Shop for Car Insurance?

While there's no specific date on the calendar for the best rates, industry experts suggest starting your search about three to four weeks before your current policy expires. Shopping early gives you time to compare offers thoroughly and may lead to better rates. Insurers like Liberty Mutual and Travelers offer "early shopper" discounts. Some insurance experts also note that December and January might offer slightly better rates as fewer people are shopping. However, the most significant savings come from timing your search relative to your policy's expiration and other factors, not the season.

For example, one driver found that by shopping early and comparing quotes, they saved hundreds of dollars on their car insurance. Another driver noticed a difference of over $1,000 just by timing their search correctly.

When to Shop for Car Insurance

Beyond renewal time, major life changes and unexpected circumstances often call for a fresh look at your insurance options. If your policy rate has increased, even by a modest amount, shopping around could eliminate the increase and potentially save you more. Many drivers don't realize that rate increases often have nothing to do with their driving but can be due to companywide adjustments or other factors.

Life changes like retirement, marriage, divorce, or having fewer drivers on your policy can also impact your rates and eligibility for new discounts. Be sure to ask your insurer about these discounts. For instance, a driver who got married and asked about discounts found that they could save several hundred dollars per year.

What Goes into a Car Insurance Policy Quote?

Several factors influence your car insurance rate. The coverage types and limits you select play a significant role. Higher coverage limits and lower deductibles mean higher premiums, while basic liability-only policies cost less but provide less protection. The vehicle make, model, and age also matter. Safe features can lower costs, but expensive and high-performance vehicles with poor safety ratings typically cost more to insure. For example, the Subaru Outback, Honda CR-V, and Toyota Tacoma are among the cheapest vehicles to insure.

Your location and typical driving patterns are also important. Urban areas have higher rates due to increased traffic and theft risk, while rural areas might see lower premiums. Your daily commute distance and where you park also factor into your rate. A driver who commutes a long distance and parks on the street may pay more than a driver with a short commute and a garage.

Can an Insurer Refuse to Issue or Renew a Policy Based on Age?

The Age Discrimination Act makes it illegal for insurers to deny coverage or set rates based solely on age. However, insurers can consider several age-related factors when determining your policy costs, such as medical conditions that affect driving ability, results of required state driving tests, recent driving history and accidents, vision requirements and restrictions. At the state level, regulations vary, and some states require additional screening for mature drivers.

For example, in some states, drivers over 70 may need to undergo in-person renewal tests. It's important to check with your state's Department of Motor Vehicles to understand local requirements.

What to Watch Out for with Auto Insurance

When shopping for auto insurance, be cautious of use-based insurance programs. While they can offer savings, consider privacy implications and whether tracking devices might misinterpret defensive driving techniques. Be wary of too-good-to-be-true offers and ensure any new policy maintains appropriate coverage levels. A driver who was lured by a cheap offer found that it had significant coverage gaps and left them underinsured.

It's also important to understand the claims process and customer service of each insurer. Reading customer reviews and researching an insurer's reputation can help you make a better decision. For instance, an insurer with a strong financial rating like A.M. Best is more likely to be able to pay claims reliably.

Will Shopping for Quotes Hurt My Credit Score?

No. Insurance companies conduct a "soft pull" of your credit for quote inquiries, which doesn't affect your credit score. This allows you to compare rates without worrying about your credit.

How Often Should I Compare Car Insurance Rates?

Experts recommend comparing rates at least once a year, when your current policy is about to expire and whenever you experience a significant life change like a move, getting married, or retirement. By staying on top of rates, you can ensure you're getting the best deal.

Will My Current Insurer Match a Competitor's Quote?

It might! Most insurers will work to retain customers by matching or getting close to competitive quotes. It's worth asking your company specifically to see if they can offer you a better deal.

Can I Switch Insurance Companies Before My Policy Expires?

Yes, but ask about any cancellation fees. Even with a fee, many companies will refund unused premiums if you cancel mid-policy. This gives you the flexibility to switch to a better insurance option.

Will My Auto Insurance Policy Cover Guest Drivers?

Most insurance policies cover friends and loved ones who borrow your car occasionally due to "permissive use." However, there are important limitations and considerations, especially for longer stays or frequent borrowing. It's important to understand these details to ensure you're covered.