How long do I have to renew my auto insurance policy?
Many drivers mistakenly think there is a “grace period” for making an auto insurance payment after it’s due date, inferring from the 30 day grace period some health insurance providers might offer. This is not true when it comes to car insurance. We want to share the low-down on why keeping your insurance policy active and in good standing is best for you, your credit and your rate.
A missed payment
Whether you are paying for your insurance in monthly installments or if you are paying your insurance every 6 months, if you miss making a payment on the due date you will likely be given a “cancellation notice” – a written letter from your insurance provider notifying you that your auto insurance policy has been cancelled due to nonpayment.
Are you wondering, “Can’t I just make a prompt payment so I can continue to be covered by my insurance provider?”
Again, the notion of a “grace period” does not apply when it comes to making a car insurance payment after it is due. The ability to retain coverage after receiving a cancellation notice by promptly making a payment varies by the rules of your state and by the practices of your insurance provider.
For example, in California after receiving a 10-day cancellation notice, your policy is effectively cancelled by state law but some insurance providers may reinstate you if you are prompt to call them and offer to make a payment immediately. You may be interested to know that you are still technically insured by the provider durings this 10-day time period. But it is often challenging to get new insurance if you’ve had any lapse or have been dropped by another provider – and this is why it’s very important to make your payments on-time, every time. Please check with your your insurance policy provider for specific rules and practices.
Here’s a tip: If you’re on a pre-paid credit card, be sure to reload it before your next monthly payment to avoid a lapse in coverage or non-payment/cancellation. Also, if you have a smartphone or tablet, do a search in the app store for your insurance provider’s official app. They may be send you a push alert to remind you before a payment is due.
Typically, about 6 weeks before your insurance is slated to renew, your carrier will send you a reminder letter that a payment is due by a certain date via mail. Many carriers will also send an email notification, an automated or personal phone call, send a “push alert” to your mobile device if you have your carrier’s app installed and some companies may even send a text message to alert you that a payment is due.
Tip: If your credit card is lost or stolen during these 6 months, be sure to log into your insurance provider’s website or call them directly to update your credit card information.
How to avoid being cancelled
Almost all insurance companies will ask if you would like to have your policy set to “auto renew” which will automatically charge your credit card on the appropriate due date for your payments. By setting up an auto payment, you can be assured you won’t have a lapse in insurance coverage.
You are legally bound to inform them of any changes to the statement or conditions from your original policy. For example, if you were a teacher but are no longer, you would not be eligible for a teacher or educator’s discount. Failure to share the truth can result in being dropped from insurance company when you cannot provide actual proof that you are, in-fact, a teacher. This background check is typically done within 60 days of a new insurance policy.
We’re here to help
We don’t want to see any of you driving one single day without having proper auto insurance – not only is it risky but it is absolutely illegal.
To compare auto insurance quotes online visit AnswerFinancial.com, or if you prefer, call 1-800-258-5101 and have a licensed insurance agent walk you through your options, compare coverages and discounts, and help you through your purchase.
March 13, 2013