Is it better to pay car insurance monthly or 6 months?

While the length of the term usually doesn't affect the average cost (or the base premium), a six-month policy will be cheaper because it pays for coverage over a shorter period of time. Six-month car policies are standard for most insurance companies. You may find it difficult to find insurers that offer shorter or longer terms. How often you pay car insurance premiums depends on the company and your preferences, but it's best to pay annually or semi-annually.

Credit card companies and financial institutions often charge a fee for processing payments, and many insurance companies recover it by adding an installment fee to your monthly bill. Twelve-month auto insurance policies provide coverage that lasts 12 months from the first day of the policy. While six- and 12-month car insurance policies are relatively similar depending on the type of coverage you choose, there are some important differences to keep in mind. Bankrate has broken down the pros and cons of dividing your car insurance premium into monthly installments so you can decide which payment plan option it's better for you.

Quotes will vary depending on driving history, type of car, mileage traveled per year, state, and many other factors. Remember that you must pay your bill in advance to be covered, but the advance depends on your preferences and the insurance company's policies. Instead of the standard six-month auto insurance policy, your coverage extends to a full year and your rate doesn't change until the policy expires. This is because insurance companies regularly adjust rates for all consumers to account for pricing errors and unexpected claims.

Paying your car insurance premium in full might save you some money, but paying a lump sum may not be feasible if it puts a burden on your budget. Some insurance companies offer a full payment discount that can help make paying the premium in the form of a lump sum more cost-effective. A 12-month policy premium is the total amount you pay for an auto insurance policy that provides 12 months of coverage, often divided into monthly payments. This 12-month period that you can set and forget about allows you to stop thinking about your auto insurance policy.

for a year. When looking for the best auto insurance, remember that the term of the policy is less important than making sure you get the coverage you need at a reasonable price.