Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health insuran...

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Chris Harrigan has an economic degree from Limestone College and an MBA from Clemson University. He previously managed auto insurance claims for Enterprise Rent-A-Car. Currently, he is using his business and insurance expertise to provide insurance data analysis and visualizations to enhance the user experience.

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Reviewed by Chris Harrigan
Former Auto Insurance Claims Manager Chris Harrigan

UPDATED: Apr 13, 2022

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Key takeaways...

  • Many drivers find that the auto-renewal of their car insurance coverage for another term is a good thing because then they are not caught driving without the required auto insurance coverage
  • If your auto insurance policy is scheduled to auto-renew, you will find this information disclosed in your policy so that you can tell exactly when you are up for renewal
  • If you want to cancel your car insurance coverage, you just need to notify your insurance provider, and you can have it stopped at any time that you want
  • If the auto insurance company is going to make any changes to your rates or the type of policy that you are eligible for, you will receive written notice of the policy changes in advance of the time that your policy is set to renew
  • The auto insurance company may choose to not renew your policy regardless of any auto-renewal provisions in your policy because of changes in your driving record or in response to an excessive number of claims being filed, but this also requires advance notice

Most drivers actually want to make sure that their auto insurance is set to auto-renew because they do not want to be dropped from coverage by their current provider. To find out whether you have an auto-renewal provision in your policy, you need to read the policy itself.

Another option is for you to call up your auto insurance provider and find out the exact date on which your auto insurance policy is set to auto-renew.

If your provider is choosing not to renew your coverage or make any changes to the rate that you pay, you will receive a written notice in advance of the auto-renewal date.

Enter your zip code above to compare car insurance rates from multiple companies at once!

Understanding Policy Terms and the Renewal Process

Every auto insurance policy has a set term during which you will be provided coverage.

The typical length of the term is either six months or one year. During that time, the auto insurance company will evaluate whether your risk level changed and whether it still wants to have you as a policyholder when that specific term ends.

There are only very specific reasons for which an auto insurance company may cancel your coverage before the end of that term. A popular reason for having your auto insurance coverage canceled early is that you missed payments and failed to bring them current in time to avoid cancellation.

A decision of non-renewal is a different story altogether. The insurance company gets the right to reevaluate your coverage and driving record during each policy term.

At the end of the term, the insurance company can make a decision that your policy will not renew. This is different from a cancellation because you will have more advance notice that you need to find another form of auto insurance coverage.

Automatic renewal of your auto insurance policy can be a good thing for you because it means that you do not have to remember to sign up to renew your coverage.

This prevents many drivers from being without the auto insurance coverage that is required in their state. Most policies are set for auto-renewal as a matter of procedure by the auto insurance provider, and it is generally accepted as a standard practice in the industry.

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Switching Auto Insurance Companies Around Your Policy Renewal Date

If you decide that you want to change auto insurance providers and realize that your policy is up for auto-renewal on a certain date, you are free to notify your current auto insurance provider that you are going to be making a change.

Make sure to give them a specific date when your new coverage will kick in so that you do not have a lapse between auto insurance policies.

Your new policy must start exactly when your current policy ends in order to avoid being stuck without carrying the proper auto insurance coverage in your state.

If you decide to cancel your auto insurance to switch to another company, you may be able to avoid paying a cancellation fee to your current auto insurance company by timing the cancellation around your renewal date.

The auto insurance company may charge you an early cancellation fee, but they are not allowed to penalize you for failing to renew your auto insurance coverage with them.

Keep in mind that the cancellation fee is typically minimal, so this may not be the best reason to avoid switching your insurance carrier before a certain date.

What Happens if Your Rates Go Up After a Renewal

Every time that your auto insurance policy is up for renewal, there is a potential for a change in your rates.

Some of the common reasons why you could have a rate increase are that you had filed a claim for damage under your policy, you were involved in an accident or you received a ticket for a moving violation.

On the other hand, any of these issues or a combination thereof can be grounds for your auto insurance company not to renew your coverage.

If you find that your rates have gone up and that you are having trouble affording your coverage, this is a great reason to shop around for other options.

You can get a variety of quotes by requesting them online, which makes shopping for car insurance and comparing rates from different providers easier than ever before.

When you start looking at new rates, if you have a set budget in mind, you can easily eliminate any companies that cannot go below your rate.

You may find that with several accidents on your driving record and moving violations, you might need to spend more time searching online in order to get an affordable rate. It also helps to inquire about any discounts that you could expect from each company that you speak with about coverage.

Wrap Up on Car Insurance Auto-Renewal

Having your auto insurance policy automatically renewed for another term is not illegal.

In fact, it is a common practice by almost every auto insurance provider in the U.S. because it is the best way to guarantee that no policyholders go without coverage for a period of time.

If you want to find out about the renewal status of your own policy, you should read your policy documents to find out the renewal date.

If you do not have your policy documents, you can also call your auto insurance provider to find out the status of auto-renewal of your specific policy. Enter your zip code below to find car insurance rates that work with your budget!