The Best Time to Buy Car Insurance

Again, there is no bad or good time of year to get car insurance, unlike buying a car at the end of the month to take advantage of a car salesperson’s monthly sales goal. While vehicles themselves are often discounted around holidays like Christmas, New Year’s, and the Fourth of July, car insurance companies typically don’t offer seasonal deals. Rather, the best time to switch or buy new car insurance depends on your life circumstances.

Did you recently celebrate a big birthday, move, or get married? Now could be the perfect time to switch and save on auto insurance costs. Big life changes, like those outlined here, can significantly impact your car insurance rates. These are the times you should explore changing policies to get the most cost-efficient coverage.

Age

If you have a teen driver in your household, you probably experienced a huge increase in insurance premium when they started driving, due to their lack of driving experience. However, car insurance premiums tend to decrease with age, so as you or someone on your policy ages beyond 25, expect lower rates. It could be worthwhile to shop around and see which provider can offer you the most affordable rates for your age range. For example, see Progressive’s average annual rates by age group below.

Driving Record

Maybe you got into an accident and are now considered a high-risk driver. If so, you might want to switch to a nonstandard insurer like Acceptance or National General. On the other hand, if a ticket or at-fault accident is no longer on your driving record, you may be able to get lower rates. It all depends on your driver classification.

Credit Score

In most states, insurers can take credit score into account when determining a driver’s car insurance costs. As a result, if your credit score increases significantly, it’s worth seeing if insurance providers can offer you a lower rate than what you’re paying currently.

Note that some states prohibit car insurance companies from taking credit scores into account. In Michigan, Massachusetts, California, and Hawaii, for example, they can’t use credit scores to determine prices at all, so a change in credit score won’t affect your rates in these states. Otherwise, if you have poor credit, get car insurance quotes without credit checks.

Degree

Believe it or not, around 60 percent of car insurance companies vary their rates based on a person’s level of education. The more education you have, the lower the insurance premiums you’ll pay, as studies show more educated people are less likely to perform risky driving behaviors and get into accidents. In the same vein, more education generally translates to a higher income, which can also mean lower premiums.²

If you completed college, you can save anywhere from $300 to $600 per year on car insurance compared to if you graduated from high school only. Finished high school only? You could save $300 compared to someone who dropped out.

It’s worth shopping for car insurance every time your policy is up for renewal to see if you can get lower insurance costs. But make sure you do your research before your policy expires; a gap in insurance could lead to higher rates, so cancel your current policy only after your new policy’s effective date.