It’s important to know how long to keep your car insurance records and whether it is okay to discard your policy documents during the life of the insurance policy. In some cases, you can throw away documents quickly but should retain other documents for a longer period. It is easy to determine which ones to keep versus which ones to discard.
Documents that you need to keep
Knowing how long to keep auto insurance statements and how long to keep insurance policies requires you to determine why you might need them in the future. There are a number of documents that you will receive as part of your auto insurance coverage that should be saved:
- Your auto insurance card. This small card easily fits into a wallet or glove compartment and should be kept with you when operating your vehicle. You may also have access to a digital insurance card through your auto insurer, although a paper copy is beneficial as a backup if you forget your cell phone. In some states, you are required by law to have the card in your vehicle. If you are pulled over by law enforcement, they will request proof of insurance. You will also need your auto insurance card if you have an accident since it contains your policy number and other pertinent information you will need to exchange with the other driver.
- The declarations page of your auto insurance policy. You will receive this page along with your other policy documents when purchasing new insurance coverage or renewing your policy. In addition to your name and address, description of your insured vehicle(s) and your policy number, the declarations page includes a summary of your policy’s coverages and deductibles, and also explains the claims-filing process. Keep this document in a safe place until you receive a new one when you renew your policy.
- Documents pertaining to a claim. If you have an open claim with your auto insurer, keep all receipts, repair bills and any other paperwork pertaining to the claim. These documents can be disposed of once you have received a check and the claim is officially closed.
- Your monthly billing statement. It may be a good idea to keep a file of your billing statements for tax purposes if your insurance is related to a business (if you use your car for business purposes, for example, or have a home office.) If you are audited, you may need to show your bills for the last seven years. Depending on your insurer, you may be able to access copies of past bills on your company’s website.
- Your premium. This information is actually not a document — it is on your billing statement — but it is worth keeping track of for the long term. Staying aware of your rates over the years gives you a clear sense of how often your rates are changing — which might have you thinking about shopping your coverage if your rates are high. Looking at the average cost you paid in 2019 vs. what you are paying now may help you determine if you are paying too much or getting a good deal.
Documents that you do not need to keep
Determining how long to keep insurance records also involves knowing what you can throw out, and when. Here are a few items that you do not have to keep indefinitely:
- Your main policy document. This is the multi-page document that includes all the details about your policy limits, discounts, coverage, endorsements and more. Many people hold onto these pages until they renew their policy — and that is fine. But it is not really necessary since many insurers offer digital access to these documents through your account at the company’s website. If your insurer does not have this functionality, hang on to them until you receive a new policy package in the mail when you renew. Once your policy has expired and you no longer are paying for it, you can discard these documents as well.
- Canceled checks from paid premiums. Many banks no longer return your canceled checks. If yours does, you can shred the checks once you have reconciled them with your account.
How long to keep insurance records
Bankrate looked at how long to keep insurance statements and saw that some of the most extensive ones, like your actual policy documents, do not need to be retained for more than a year. Once you have the new policy in hand, the old one can usually be tossed if you did not have a claim during your policy term. Any records from policies that are no longer in effect can also be discarded. For example, if you still have the documents for a vehicle you no longer have, it is unlikely you need to retain these documents.
You will usually receive a new set of policy documents annually, or in some cases, semi-annually. Once you have received these, it is no longer necessary to keep the old ones. It should be standard practice for you to file the new copies at the same time you discard the old ones.
If, for some reason, you accidentally discard current policy documents, do not worry. Your insurer will have copies of all paperwork on file, and you may be able to access them online as well. A quick call to your agent should be enough to be issued a new copy to replace the discarded one.
There is one important exception to these rules, however. If you have an open claim related to an accident or auto mishap, or there is a possibility that a claim might be opened against you by another driver, retain all insurance documents and anything related to the accident, such as repair bills or towing charges, until the claim is settled. This applies even if the policy is no longer active.
Claims can take years to be resolved. For example, if you are in an accident that includes medical costs, it may take several years to settle all the medical bills and invoices. In the meantime, you may have sold the vehicle and closed the insurance account. Keep your policy documents until you are sure there will be no more costs applied to the claim.
How to properly dispose of old insurance policies
Identity theft is growing across the U.S., according to the Insurance Information Institute. Your policy documents may contain names and addresses, policy numbers and other personal data, and an enterprising thief may use them for personal gain if your documents are found in the garbage or at a dump site. In general, you should always shred anything that has your name or identifying details on it.
A small home shredder is adequate for this work. Some office stores offer shredding services, and local banks or companies offer free shredding days regularly for residents in many areas.
Frequently asked questions
What is the best auto insurance company?
Although there is no one “best” auto insurance company that works for everyone, Bankrate has identified the companies that offer the best prices, most comprehensive coverage options and superior customer service on our Best Auto Insurance Companies for 2021 listing. A good place to start your search for auto insurance would be to get quotes from these companies.
Can I throw away old insurance policies?
When you receive your new policy in the mail each renewal, you can discard the old one. However, keep billing statements and the declarations page and make sure you have your auto insurance card whenever driving. You may shred policy documents if you close out the policy unless there is an open claim or the possibility of an open claim on the policy.
How should I store documents that need to be saved?
There are several options to store your insurance documents. If you need to store paper copies, a small, portable, fire-resistant lockbox is a great idea. Never store this in your basement, in case your home experiences flooding. You may also want to consider offsite digital storage in the cloud or on a flash drive or other portable storage device. For a small fee, sites like Dropbox and iCloud will store your electronic documents safely and be accessible no matter where you are or what device you are using.