When you enroll in car insurance, your agent might ask you if you want to set up your policy to automatically renew. This means that at the end of each term, usually annually, your auto policy will renew for the next term without requiring action from you. 
Often, enrolling in auto-renewals can save the insurance customer time, hassles and money. Still, auto-renewal has its drawbacks. The vigilant customer will think carefully about whether to enroll in this service.
Benefits of Auto-Renewal
Usually, about 30 days before your car insurance is set to renew automatically, your auto insurer will notify you. They often notify you of possible changes to your coverage and premiums, if these occur. Some of the benefits of letting your policy auto-renew include:
- Lowering your risk of policy expiration. You don’t want your policy to expire because you forgot to renew it. Driving without insurance is often against the law; so, you want to keep your policy active at all times. Also, if you let your policy expire, your insurer may refuse to re-issue your coverage. They may also charge you more for your new policy.
- Qualifying for cost benefits. Many insurers offer perks for customers who auto-renew their policies. This may include giving the discounts for auto-renewal or for being a loyal customer.
Keeping active, affordable coverage is likely one of your priorities, as it should be. So, both of these incentives might help you decide to auto-renew your insurance.
Cons of Auto-Renewal
Still, drivers considering automatic insurance renewals should do so with caution. At times, it may be to your benefit to change your policy each term.
- Before your policy renews, make sure it still offers adequate limits for your needs. You might need to change certain limits based on your driving liabilities and car value.
- Make sure your insurer has your updated driving record, usage and vehicle values. This will help the insurer make sure they charge you a fair cost for your policy. It will also help you and the insurer make changes to your policy as needed. If they don't have the right information, your insurer may keep you on an inadequate policy.
- As you approach your renewal, it never hurts to compare other car insurance policies. You might save even more money or get more adequate coverage by looking for another policy.
Remember, your auto insurer will usually notify you before your policy auto-renews. Use this time to review your existing coverage and prepare for the next term. If you have questions about your policy, contact your insurer as soon as possible. They can make sure a new policy takes effect as the old one expires.