Buying auto insurance means buying an ongoing service. That’s why you have to pay for your policy regularly in order to maintain it. Sometimes, you can pay a policy’s entire premium in a single lump sum. In other cases, you can work out a payment plan with your insurer that fits your budget. Still, regardless of which payment option you choose, you must make the payment on time.
Missing a single auto insurance payment puts you at risk of numerous penalties, not least the cancellation of your policy. Let’s take a closer look at how you can do all you can to avoid missing payments.
Why You Shouldn’t Miss Payments
Going without car insurance even for a day can be problematic. Insurance companies often raise rates for those who have missed payments. Additionally, your current insurer may no longer wish to provide coverage to you. If you continue to make late payments, they are likely to cancel your coverage.
Avoiding Late Payments
It’s relatively easy to avoid missing payments on your auto insurance in a few easy steps:
- Set up auto-payment options. Let your insurer pull the funds for your premium directly out of your bank account at the time they are due.
- Pay your premium in full at the start of your policy term, instead of in monthly payments. This means having to make only one payment, and you won’t have to pay again until it is time to renew your policy.
- Pay a month in advance, if possible. This can give you a bit of a cushion for late payments. Being able to pay for your auto insurance online can help you minimize this risk.
If You Miss A Payment, Contact Your Insurer
As soon as you become aware of a missed auto insurance payment (or notice that you are at risk of missing one soon), then you should reach out to your insurer. Ask them what steps you can take to remediate the issue as quickly as possible.
In many cases, insurers will allow you a grace period when you miss a payment. Therefore, they are unlikely to cancel your coverage as soon as your payment’s due date passes. Additionally, with the ongoing economic challenges arising from the COVID-19 pandemic, many insurers have further extended payment flexibility to assist those who face hardships.
Most companies will provide you with advanced warning of the cancellation. And, if you are having trouble making your payment, let your car insurance provider know that. They may be able to help you find lower rates from a modified policy. Keeping your coverage on time and in line is critical. It helps you meet all legal requirements and reduces your risks.
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