How do I renew my car insurance?

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Here's what you need to know...
  • During this policy period, the rates won’t change unless you make a change to the vehicles, drivers, or coverage options on the policy
  • When you buy standard insurance, the company may offer you the option to renew your insurance if you still qualify for coverage when the term approaches its expiration date
  • If you aren’t eligible for insurance because of your driving record or your claims record, the insurance company must notify you in writing that your policy was set up for a non-renewal

As a consumer, you need to decide if you want to buy auto insurance that lasts for six or 12 months at a time.

While both types of policies offer the same type of protection, securing coverage for a longer period typically benefits the policyholder.

Once the policy term is up for expiration, the carrier gets the opportunity to reassess your personal details so that they can decide if they want to continue the relationship.

If you still qualify for car insurance, the company will send out a renewal packet that shows you your new rates and policy details.

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What is an auto insurance term?


It’d be nice and convenient for consumers if they could buy an auto insurance policy that would stay in effect for as long as you are the legal owner of a private passenger auto.

Unfortunately, all traditional auto insurance policies end because they are written in terms. These terms will last for either six months at a time or 12 months at a time.

Your term consists of an effective date and an expiration date. These dates represent when the coverage starts and when it expires.

During this period, your risk class won’t change unless you take action to change your policy.

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Why do auto insurance policies renew?

When an insurance company issues your policy, the underwriter calculates a gross rate that you must pay for each unit of coverage that you carry.

This rate won’t change during the term, but at each term renewal, underwriters can reassess risk and then recalculate your rates.

When you apply for insurance, the rate isn’t guaranteed until the application goes through the underwriting phase and the policy is issued.

As long as you have an active license, and you comply with the conditions of the policy, the carrier must offer you coverage for the whole term.

What do underwriters look at when they are processing a renewal?


Underwriters look for any indication that risk has changed. When a driver gets a ticket or gets into an accident, they carry more risk.

To find out if the driver has some change in their risk class, the underwriter will check the following:

  • An updated Motor Vehicle Report
  • An updated CLUE report that shows whether or not any claims have been reported through another carrier
  • A review of the company’s claims records to see if there are chargeable claims
  • A review of mileage and usage information

If you have too many losses or accidents, you might not be considered eligible for coverage according to the carrier’s underwriting guidelines.

When you’re no longer eligible, the carrier will send you a notice of non-renewal that explains why the policy is not renewing.

When do you get renewal documents in the mail?

Insurance carriers will process renewals between 30 and 45 days before the expiration date that is written on your declarations page.

In most states, the carrier is required by law to send you renewal documents at least 20 to 30 days before the term ends.

If your information is up-to-date and you’re getting all of your discounts, all you have to do is submit payment by the expiration date.

When you get renewal documents in the mail, you should look at your new policy premium. Compare this premium to what you paid the last term to see if the rate has increased.

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