What If I Pay My Insurance in Full?
Benefits of Paying Your Insurance in Full
Monthly payments are what most people choose when it comes to paying their insurance premiums. That way, the total amount can be split into monthly payments that are easier to manage. Even though paying for premiums in full is not as common, it also has its advantages.
If you’re getting an insurance policy for a 6 to 12-month term, here are the advantages of paying for it in full.
No More Bills to Worry About
One of the great things about paying your insurance premiums in full is that you don’t have to worry about any other insurance bills coming your way for another 6 to 12 months, depending on the term of your insurance policy.
No-Risk of Cancellation
Paying once for everything gives you peace of mind that you will never have a late payment or a missing payment. Both of these can put you at risk of getting your policy canceled by your insurance company —and that doesn’t exactly make you look great.
You Might Get a Discount
Some insurance companies will offer a discount if you pay in full, as a way to reward you for paying everything upfront. It is not always a huge discount, but you will notice a difference since insurance companies tend to charge a transaction fee for monthly payments.
Your Rate is Locked for That Period
Even if you make a claim, your insurance company won’t be able to increase your monthly payments if you paid in full. This is particularly helpful when it comes to buying auto insurance for inexperienced drivers.
Something to Consider
Although there are many advantages of paying your insurance premiums upfront, it can be a significant investment that you must be sure you can manage without affecting the rest of your finances.
Talk with your insurance agent to get all the details ironed out before you make a decision.