Why are most Car Insurance Policies 6 Months Long?

When you are shopping for auto insurance, you will quickly notice that competing companies offer policies that are valid for either 6 months or one year at a time. While you may believe that comparing premiums is the best way to find the most cost-effective insurance policy, the policy term is something to consider when you want to find a plan best suited to cater to your individual needs.

At first, you may notice that a majority of companies offer 6 month terms. What you might not know is this can actually end up costing you more in the long run. American Tri-Star offers some valuable insight as to why 6 month terms aren’t always the best options for cheap auto insurance policies in San Diego.

A 6 month renewal period is not just a period to reprint ID cards, this is the period where your policy will undergo the underwriting process so that your premiums can be recalculated based on risk. If you have an accident, file an at-fault claim or you are convicted of a minor or serious moving violation, an insurance company has the right to surcharge your premiums or non-renew your plan.

In most cases, 1 or 2 blemishes on your policy will lead to surcharges, but convictions that make you high-risk can disqualify you from being eligible for coverage. Companies may only reassess risk at a renewal period, and the longer the period the better for you. If you’ve recently been in an accident or are coming up to a renewal period where you know your rates will increase, request an instant auto insurance quote for low rates from American Tri-Star.

Another thing to keep in mind is that in addition to being surcharged if you have tickets or accidents, there is a good chance you will lose a Good Driver or Driver Safety discount sooner than you would have if you were to choose a 1 year plan. A 6month plan in this case would definitely cost you savings in the long-run.

Now that you understand why there are advantages to purchasing a 1 year plan, select the best policy for you and steer clear of the less than ideal options. For help in choosing the San Diego car insurance that is right for you, contact an expert representative today at 619-272-2100.