Should I Buy a 6 or 12 Month Car Insurance Policy?

Last Updated on February 6, 2020

When selecting a car insurance policy, you’ll typically have two options when it comes to a time frame – 6 months or 12 months. Each option has its own advantages and disadvantages, you’ll just need to decide which one makes the most sense for you. Here are the advantages and disadvantages of each policy type to help you make your decision.

Should I Buy a 6 or 12 Month Car Insurance Policy?

Advantages of a 6-Month Car Insurance Policy

There are several advantages of committing to your car insurance for only six months. The biggest advantage is that it gives you much more flexibility to switch your policy as needed. If you aren’t happy with your policy for any reason, or you find a more affordable option, it’s much easier to switch to another provider without being locked in for six extra months. Renewing your policy more often also means there’s an extra opportunity for your premium costs to go down, so you could end up saving money in the long run. Driving violations and other credit issues will only stay on your record for so long, and after a certain period of time, they will stop negatively affecting your premiums.

Another key advantage of a shorter car insurance policy is that they are much easier to pay in full upfront. Most car insurance providers will give you a discount if you pay the entire policy in full at once, rather than paying in monthly installments. This discount can be very significant, which is why it’s worth paying upfront if you are financially able to.

Disadvantages of a 6-Month Car Insurance Policy

The main disadvantage of a 6-month policy is that you have to worry about renewing it twice as often. This means much more time spent shopping and confirming your policy each year. It also gives your insurer an extra opportunity to raise your rates, so you could end up paying significantly more for car insurance in the long run.

Advantages of a 12-Month Car Insurance Policy

The key advantage of a 12-month insurance policy is that you don’t have to worry about renewing it as often if you’re happy with your coverage. Car insurance shopping can be stressful, and buying a 12-month policy will save you the stress of repurchasing for an entire year. The other advantage of this is that you’re locked into the same rate for the entire year. Your premiums can increase or decrease every time you need to renew your car insurance. If you have a longer car insurance policy, there won’t be as many chances for your insurer to raise your prices. Some insurers may even give you a small loyalty discount for choosing a longer policy. For most people, the stability of a longer car insurance policy is preferable.

Disadvantages of a 12-Month Car Insurance Policy

The biggest disadvantage of a 12-month car insurance policy is that they are actually very difficult to find. It’s usually only local providers that offer them, so if you prefer the convenience of a larger national provider, you likely won’t be able to get a 12-month policy. The exception is if you’ve been with the company for a very long time – in many cases, you can talk to your insurance agent and let them know you’re interested in a longer policy, and they will do what they can to help you. The other major disadvantage of a 12-month policy is that you have much less flexibility. If you decide you want to switch to another provider in the middle of your policy, you may have to pay fees to break the contract. You also won’t have as many opportunities for your premiums to go down.

Which Option Is More Expensive?

It is very difficult to compare the overall cost of 6 and 12-month car insurance policies because there are very few companies that offer both. In general, six-month policies are going to be less expensive in the long run. They’re usually offered by large national companies that can afford to provide lower rates. These companies generally have a broader range of discount options as well. The small companies that do offer longer policies generally have higher rates, although they typically offer good customer service and may offer specialty coverage that you can’t get from a larger company.

However, it’s important to note that every car insurance policy is different. When you apply for insurance, your agent will provide you with a quote based on a number of different factors, including your driving history, the type of vehicle you’re driving, your location, and much more. The insurance company will look at these factors in order to determine the right price for your car insurance. The amount you’ll pay for car insurance will depend on how much of a financial risk you present to the insurance company. For example, if you have a poor driving history, you’ll be considered more likely to get into an accident than someone with a clean record. You’ll end up paying higher premiums to compensate.

Since car insurance is different for everyone, there are situations where a longer 12-month policy might be more affordable for you, even though this isn’t the norm. When shopping for car insurance, it’s important to get quotes from many different insurers. Each insurer has its own method for calculating their premiums, and one company might offer significantly lower rates than another. Ask your insurance agents about both 6 and 12-month premiums and compare your options to see which one makes the most sense for you.

Both 6 and 12-month car insurance policies could work for you, depending on your situation. 6-month policies are much more accessible and easier to find than 12-month policies, and they tend to be more affordable. However, a 12-month policy can offer you more security and minimizes the amount of time you’ll need to spend shopping for a policy.

James Shaffer
James Shaffer James Shaffer is a writer for and a well-seasoned auto insurance industry veteran. He has a deep knowledge of insurance rules and regulations and is passionate about helping drivers save money on auto insurance. He is responsible for researching and writing about anything auto insurance-related. He holds a bachelor's degree from Bentley University and his work has been quoted by NBC News, CNN, and The Washington Post.
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