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4 Benefits of Paying Your Auto Insurance in Full

When you buy your auto insurance you will often be given the option of paying your premium in a number of ways. For example, with many insurance companies you can make a deposit and pay in monthly installments, or pay in full. While a monthly option may be easier on your budget, there are benefits to paying your insurance premium in full.

To reduce your annual costs, remained insured the whole year, and get rid of the headache of extra bills, you might consider paying your insurance upfront once or twice a year.

Benefits of paying your insurance in full

  1. Bills will not accumulate. Once your insurance is paid in full, you don’t have to worry about getting another bill. You don’t risk not paying on time, which can potentially void your coverage, lead to higher costs, and even hurt your credit score.
  2. You don’t risk a cancellation. Since there is no risk of missing a payment, you also do not run the risk of your insurance company cancelling your policy. It is essentially “guaranteed” insurance for the period of 6 or 12 months.
  3. You will pay less during the year. Some insurance companies offer a “pay in full” discount, so they will actually reward you for paying up front.

As stated by one very important company in the auto insurance arena, known as Auto Insurance Scottsdale Az, even if the insurer doesn’t explicitly offer this discount, you’ll save a lot on your total costs by paying upfront.

  1. Your premiums will not increase during that period. If you pay upfront, your insurance company won’t be able to increase your monthly costs, even if you file a claim. Basically, you’ll get a “locked” rate for the 6-to-12-month period.

This is especially useful for auto insurance regarding young or inexperienced drivers or those with many accidents and moving violations.

What are the disadvantages of paying in advance?

The disadvantage of paying in advance is that it is more difficult to change insurance providers if you move out of state or want to compare quotes. It is possible to cancel your insurance if you paid in full, but it may take a while to get your money back.

Even though you can save money throughout the year by paying upfront, it can still be a decent financial burden to pay all at once. But there are ways to minimize this initial cost to save even more money on your annual cost. Start by asking your insurance agent what discounts are available to you.

Comprehensive coverage includes a number of different policies that, when put together, provide a substantial package of insurance coverage including:

  • State minimum liability
  • No-fault insurance coverage
  • Collision
  • Integral

Essentially, this covers damage caused by collision, accident, vandalism, theft, and other types of damage that were not caused by an accident. However, it is important that you read the fine print because there may be certain types of damage that are not covered.

What coverage is right for me?

To find the best coverage for your needs, firstly look at all the available policy options and then compare what offers comprehensive coverage for your vehicle.

Also, you should pay attention to:

  • Fair market value of your car
  • Where do you live
  • Your budget

You may find that full coverage auto insurance is not suitable or perhaps it is too expensive for your means. When you start with the basics and work your way up to other policies that you may or may not use, you can find the right balance between the right coverage that meets most, if not all of your needs, and a price that fits your budget.

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