When shopping for car insurance, you may wonder how long your car insurance policy will last. Typically, you’ll find that most policies remain in effect for periods of six or 12 months. Some providers will allow you to pick your policy duration, which means you will have to consider the benefits of 6-month vs. 12-month car insurance policies. There are advantages and disadvantages to both, and understanding these differences will help you make an informed decision on how to best protect yourself and your vehicle.

6-month vs. 12-month car insurance policies

The primary difference you will find when comparing a six-month vs. 12-month car insurance policy is the duration of the coverage period. A six-month policy will be re-evaluated once every six months, meaning your policy will be adjusted twice per year. A 12-month policy will only undergo this review process once per year. The review, which takes place at the end of your policy term, will evaluate your claims history, driving record and other factors that may ultimately affect your insurance premium.

Another difference you may find between these policy options is the cost. If you pay in full, a six-month car insurance policy will typically cost less due to its shorter coverage period. However, if you’re paying month-to-month, you may not notice much difference in price between a six-month and 12-month policy. In general, the average cost (also referred to as base premium) isn’t heavily impacted by the policy’s term length. But it is important to note that because a six-month policy gets evaluated twice as frequently, your premiums likely change more often, either decreasing or increasing, depending on your previous coverage period. If you want more consistent premiums, you may prefer a 12-month policy.

What is a 6-month car insurance policy?

When you shop for car insurance, you may have the option to choose between a six-month or a 12-month policy. While not all companies give you this choice, knowing that different policy terms exist may be helpful. A six-month car insurance policy simply means that your policy is effective and priced for a period of six months before it will be up for renewal.

Pros of a 6-month auto policy

  • Policy flexibility: While you can switch auto insurance companies for any reason at any time, some insurance providers may charge a cancellation fee if you end your policy before the term expires. If you are unhappy with your insurance carrier or have found a better option elsewhere, a six-month policy means you would not have to wait as long for your renewal period. This provides additional flexibility if you should choose to change providers.
  • Driving activity is re-evaluated more frequently: Some people may benefit from more frequent policy reviews. High-risk drivers, for example, might find a six-month policy attractive. When tickets or accidents drop off your driving record, typically after three to five years, there may no longer be a surcharge on your policy. Each time your policy renews, your insurance company may remove any surcharges that no longer apply.
  • Paying in full may be more accessible: Some insurance carriers offer discounts for customers who choose to pay their policy in full upfront instead of paying the premium in monthly installments. This option is available for both six and 12-month policies, but it may not be possible to pay for a full year upfront. If paying a 12-month policy in full doesn’t work with your budget, choosing a six-month policy could make paying in full more accessible and allow you to qualify for the discount.

Cons of a 6-month auto policy

  • More frequent premium recalculations: If you buy a year-long car insurance plan, your cost usually stays steady for the whole year unless you make changes like adding or removing a vehicle or driver. However, with a six-month policy that renews twice a year, you could see your premium fluctuate more frequently.
  • Potential to forget renewal dates: When you purchase a 12-month policy, you have the option to pay for the entire expense of your policy for a full year upfront. When you have a six-month policy, you might be more likely to forget your renewal dates since they occur twice a year and could potentially miss a payment, causing a lapse in insurance coverage.
  • Possible missed discounts: If you are benefiting from a discount that you will no longer qualify for when your policy term ends, a six-month policy could mean losing those savings sooner than if you were locked in for a full year. For example, a discount for new policyholders could provide more savings over a 12-month period.

What is a 12-month auto insurance policy?

A 12-month auto insurance policy is the same as a six-month policy, except that it is active for 12 months instead of six months. Many major carriers only offer six-month policies, but some may give you the option of choosing between the two (or only give you the option of a 12-month policy).

Pros of a 12-month auto policy

  • Less frequent premium fluctuations: Suppose you cause an accident during your policy term that will lead your carrier to add a surcharge to your policy at your renewal. In that case, you could have more time surcharge-free on a 12-month policy because you’ll have more time between renewals.
  • May be easier to remember renewal dates: Since a 12-month auto policy has half as many renewal dates as a six-month policy, you may be more inclined to remember your policy renewal date. This could be important for policyholders who aren’t on auto-pay and prefer to pay in full.
  • May not need to requalify for discounts as often: Periodically, you might be required to provide proof to maintain some discounts (the good student discount, for example). Although your car insurance company probably won’t need you to provide proof at every renewal, it will most likely be on a renewal date when you do have to send in documentation. Since renewals happen less frequently with a 12-month policy, you may be able to cut down on how often you send paperwork to your carrier.

Cons of a 12-month auto policy

  • Less policy flexibility: Some companies charge an early cancellation fee if you terminate your policy in the middle of your term. If you want to cancel but also avoid this fee, you’ll have to wait until your renewal date (which could be further on a 12-month auto policy vs. a six-month auto policy).
  • Driving activity isn’t re-evaluated as frequently: Because a 12-month policy doesn’t renew as frequently as a six-month policy, surcharges for accidents and tickets are not removed as often. For instance, if an accident surcharge reaches maturity and is eligible to be removed in June, but your policy doesn’t renew until December, you’ll have to wait until December for the surcharge to “drop off.”
  • Harder to pay in full: Although your premium may not differ much on a 12-month car insurance policy compared to a six-month policy, it could be harder to pay a 12-month policy in full since you will be paying for the entire year’s worth of insurance upfront.

Are 6-month auto policies more expensive than 12-month policies?

The length of your policy term does not typically impact your overall car insurance rate. It may, however, dictate how often your insurance company reviews your policy for company-wide rate increases and decreases. Additionally, surcharges associated with accidents and tickets may be removed at eligible renewals, so you might want to consider how much current activity you have on your driving record when choosing your policy term length.

On average, car insurance costs $212 per month for full coverage. Remember that your rate will vary based on your personal rating factors like your driving record, claims history, vehicle type and more.

How do I know which policy is right for me?

Many companies typically provide the option of either a six-month or 12-month car insurance policy. If you have a preference for a specific policy length, you may need to select a particular company that offers coverage for your preferred term. You will want to consider the pros and cons of each before deciding the best insurance company for you.

Opting for a six-month policy could be wise for drivers with a clean record and no recent claims or major violations. If you’re okay with undergoing a rate review every six months and value the flexibility to cancel more frequently without facing fees, a six-month policy might suit you.

On the other hand, a 12-month policy might be the cheapest car insurance option for some, as it avoids the risk of twice-yearly premium increases and locks in your rate for a full year. Keep in mind that not everyone qualifies for a 12-month policy. Some companies default to 12-month terms but offer six-month terms to drivers with poor records or credit.

Frequently asked questions

    • Whether you pay your car insurance premiums in installments or in full likely depends on your financial situation and how you like to handle your bills. Generally, most insurance companies will offer several payment plan options to give customers the ability to make payments based on their individual financial situation. However, some companies offer discounts when you pay in full, which could be worth it to get the cheapest average six-month car insurance premium.
    • Not all carriers offer six-month car insurance policies. Companies dictate the terms of their policies and may only offer specific lengths for certain policy options. Some may exclusively offer six-month car insurance, while others may only offer 12-month policy plans. Contact your provider and ask to speak to an agent or request an online quote to determine what policy lengths are available to you.
    • Most car insurance policies last six or 12 months, depending on the coverage you choose. Regardless of the term length, most policies automatically renew at the end of the term unless you cancel the coverage.
    • The shortest term available for car insurance is generally six months. Some providers may offer shorter terms, but it is not a common practice. However, you can typically purchase a six- or 12-month policy and cancel it midterm if you no longer need the coverage or if you have replaced your car insurance with another provider. You may be charged a cancellation fee though, so check with your carrier for the specifics. If price is a concern, most insurance carriers allow you to pay for six and 12-month policies on a monthly basis, although there is often a slight surcharge for not paying in full.