Auto Insurance Auto-Renewed? Inaction Can Cost You $516 a Year
Car insurance is one of those bills many people set on autopilot. But that convenience can quietly cost you. In fact, those who don't review their policies regularly or worse, let them lapse, end up paying hundreds more each year than necessary. Here's what auto-renewal can cost you annually.
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Auto-Renewal Doesn't Always Mean the Best Rate
You might assume that years of on-time payments and claim-free driving are earning you goodwill and savings with your provider. However, not switching providers often is probably costing you more.
Insurers don't always offer their best rates to existing customers. Instead of rewarding your loyalty, some insurance companies quietly raise your rates over time. But if you shop around or negotiate, you can save a noticeable amount each year, while those who simply accept renewal quotes may overpay without realizing it.
Premiums Have Climbed Sharply
It's not just the loyalty penalty hitting your wallet. Car insurance rates have gone up dramatically over the years. Inflation, rising cost of repairs, and the increase and severity of accidents are the major drivers of high premiums.
The average consumer pays $2,238 per year, according to Insurify. Auto-renewing without comparing rates often means paying more.
What Shopping Around Actually Saves You
According to Consumer Reports' 2024 auto insurance survey, those who switched insurers saved a median annual savings of $461. We could all do something with that amount. You can compare quotes of multiple providers online and lock in a lower rate without a single cell phone.
Make sure you shop around a month before your renewal date. This way, you'll have more time to compare your options without rushing. Plus, shopping too close to your renewal date may result in higher quotes.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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