Automatically Renewing Your Car Insurance May Be Costly

Once most drivers have gone through the work of finding an automobile insurance provider and securing a policy, they aren’t in any hurry to do it again. As such, most drivers tend to stick with their current insurance policies, with an estimated 9 million drivers (27%) using auto renew. This means that, at the end of the policy period, the policy simply renews itself, often with additional charges in tow. Many drivers think they don’t have to worry about this, often believing that they’re still getting the same great deal or that their “loyalty” discounts will circumvent any additional charges. Unfortunately, many policy deals are only for the life of one policy, and those discounts often don’t make a dent in the additional fines that some providers will bill you if you let them. In fact, many people are unaware of just how much of their money is being sucked out of their bank accounts by their car insurance providers.

Studies indicate that approximately 39% of drivers in the United States have been using their car insurance providers for a period of at least three years. 5% of these drivers have even been with their providers for ten years or longer. Unfortunately, the number of drivers who check their renewal prices before renewing is a small 45%. Even fewer drivers, approximately 24%, bother to check any changes to their coverage or to the policy itself.

When questioned about why they chose to renew their car insurance policies automatically, 26% of drivers said they believed that their current provider would continue to offer a good deal or that their policy rate would remain the same. 29% felt it was important to be loyal to their providers. 16% didn’t want to deal with the work of finding a new provider or checking up on their current one, and 13% simply found the whole process intimidating and didn’t feel they knew enough to make an effective provider switch.

Sadly, it appears that laziness and ignorance are the most common reasons behind not switching providers when necessary or, at the very least, checking up on policy changes before renewing. This is unfortunate, because this can end up costing drivers an arm and a leg, often for coverage that isn’t even really adequate to keep them protected in the event of an accident. To avoid this, drivers are encouraged to, first and foremost, educate themselves about automobile insurance. They should know about the minimum coverage requirements in their state, the average premium amounts, and they should also gather and compare free rate quotes each time they wish to renew or change their policies. If drivers can do this and can commit to doing it diligently, even though it does take a bit of time and effort, they will likely be shocked at how much money they can save on car insurance each year. Remember, the average person will pay for car insurance for a period of fifty years, so you can’t afford to overpay even once!

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