6 Month car insurance

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Shopping for auto insurance may not be the most exciting part of being a car owner, but helping you navigate the process and understand your options is a top priority for Bankrate. With your auto insurance needs changing throughout the years, it is important to know what opportunities you have to evaluate and adjust your coverage. What drivers may not realize is that car insurance policies can be renewed semi-annually or annually. While there are advantages and disadvantages to each policy type, 6 month car insurance policies are most common, and in this article, you will learn why.

What is 6 month car insurance?

When you get a quote for car insurance, many insurance companies will give you a quote for a six month policy period. A six month insurance policy simply means that your policy is effective (and priced) for a period of six months, before it will be up for renewal The reason most insurance companies offer six month policies is because every time an insurance policy renews, the insurance company is able to re-evaluate the driver’s circumstances, level of risk, and determine if any changes to the premium are necessary.

As part of this process, insurance companies may evaluate claim statistics in your area to determine if the rates charged are enough to account for potential claims payouts. If recent statistics show that claims occur at a higher frequency and payout, your insurance company may apply a company-wide rate increase. Conversely, lower claims may result in lower rates at the time of renewal or even rebates to existing policyholders. However, these rate changes can only be applied to a policy once at the time of renewal, so a shorter policy term may allow rate changes to occur more frequently.

How does a 6 month car insurance policy work?

When you receive a quote for a six month car insurance policy, you are selecting a set of insurance coverages that will protect your vehicle for the duration of the policy. The insurance company’s underwriting team will determine your premium based on a variety of factors, including your age, gender, driving record, insurance history, location and vehicle type, as well as the level of coverage you select. Depending on what discounts you qualify for, your six month insurance costs may be reduced.

When your policy term is coming to an end, your insurance company will evaluate your premium and send a new renewal offer which states that it will renew your policy for another six months at a specified rate. However, this rate could be lower or higher than what your original policy cost.

Pros and cons of a 6 month auto insurance policy

Although a six month auto insurance policy is the standard car insurance policy, there are a few considerations that may motivate a driver to consider opting for a 12 month policy. While you may be used to carrying the standard semi-annual policy, it may be worth receiving a quote for an annual policy just to compare your costs. Here are a few pros and cons to a six month auto policy:

Pros of a 6 month auto policy

  • Policy flexibility: When you have a six month auto policy, it tends to be more flexible due to the frequency of renewals. If your company has taken a rate decrease or you recently had a ticket fall off your driving record, you will see your savings much sooner.
  • Frequently revisit insurance needs: If you expect your insurance needs to evolve rapidly over a period of a few years, you may appreciate the opportunity and reminder to modify your policy at every six month renewal.
  • Switch carriers sooner: Although you can switch auto insurance companies for any reason at any time, some carriers may apply a cancellation fee. If you are unhappy with your insurance carrier, a six month policy means you will not have to wait as long for your renewal period to come up so you can change providers.

Cons of a 6 month auto policy

  • Premium increases: When you purchase a 12 month auto insurance policy, your premium is locked in for an entire year, but with a semi-annual policy that renews every six months, you could be facing rate increases sooner or more often.
  • Potential to forget renewal dates: When you purchase a 12 month policy, you can pay and forget about your expense for a full year. When you have a six month policy, you might be more likely to forget your renewal date and could potentially miss a payment, causing a lapse in insurance coverage.
  • Possible missed discounts: If you no longer qualify for a discount after your policy renews, a six month policy means you could lose that savings sooner. Discounts for new policyholders, for example, would net more savings over a 12 month period instead.

How do I know if a 6 month policy is right for me?

Finding the best type of auto policy should be determined based on your unique situation. Just because your friend is getting a great rate on their annual policy does not mean you will get the same rate if you switch from a six month policy. However, you may prefer the advantages to a longer policy term if your insurance needs are fairly set.

The cost of car insurance is based on a variety of factors that can greatly influence your decision to choose a longer or shorter policy duration. A six month policy may be a great option if you prefer to revise your policy on a more frequent basis, or if you are switching to a new carrier and are unsure if you will be happy with your choice. Additionally, if you know you have a ticket or other traffic violation falling off your driving record soon, you will not want to lock in your higher premium rate for a whole year with an annual policy. Some providers may not offer both a six month and 12 month policy, so that is another factor you will likely need to consider.

Frequently asked questions

Do 6 month auto policies offer the same discounts as a 12 month auto policy?

Every company will offer unique discounts so your premium savings could vary greatly between two policy types. Generally, however, companies will offer common discounts like multi-car discounts, multi-policy discounts and good driving discounts regardless of the length of your policy. Since discounts are typically percentage based, your savings will mostly depend on what percentage each company assigns each discount.

Should I pay my 6 month policy in-full or in monthly installments?

Generally, most insurance companies will offer several payment methods to give customers the ability to make payments based on their individual financial situation. For example, if you have a tight budget and do not have a lot of extra cash to pay a policy in-full, you may prefer a monthly payment plan. Some companies offer discounts when you pay in full, which could make it even easier to find cheap six month car insurance.

Is the coverage offered on a 6 month car insurance policy better than coverage offered on a 12 month policy?

When you purchase an insurance policy, the coverages you purchase offer the same protection no matter how long your policy period lasts. In other words, if you need coverage on your truck and plan on purchasing minimum liability coverage, both policy types offer the same coverage type that would work the same way in the event of an accident. The main difference between purchasing a six month car policy and an annual insurance policy comes down to personal preference on how much flexibility you want with the renewal frequency.

Written by
Jessie See
Insurance Contributor
Jessie See has a year of experience writing for Bankrate.com, Reviews.com and other insurance domains. She has covered topics ranging from auto and homeowner’s insurance to life insurance. She has been writing professionally for over a decade with experience in a variety of different topics and industries. Prior to becoming an insurance writer, she worked as a legal assistant in the field of personal injury law and as a licensed sales producer at various insurance agencies.
Edited by
Insurance Editor