Why a 12-Month Auto Insurance May Be Your Best Choice

When shopping for auto insurance, most drivers focus on price and coverage options, but policy length is another crucial yet often-overlooked detail when it comes to protecting one of your most valuable assets. Studies show that drivers rarely revisit their auto policies once they secure coverage, which can lead to missed opportunities for both increased savings and better coverage options. It’s important to remember that policy length is a major factor in the insurance equation.

In essence, 12-month policies allow you to “set it and forget it” right up until your renewal time the following year.

While many insurance companies offer standard six-month policy options, choosing a 12-month term—considered a long-term policy (versus a short-term six-month policy)—allows you to lock in your rate for an entire year. An annual policy helps shield you from mid-year rate hikes that are common in times of escalating premiums due to inflation, increased claims in your area, or even changes in your insurance score.

You can also avoid the hassle of frequent policy renewals, translating to less legwork and less risk of gaps in coverage that could leave you “in between” insurance policies. A lapse in coverage can result in higher premiums and limited insurer options down the road—as well as potential legal issues for driving without insurance.

The perfect policy for set-it-and-forget-it drivers

Annual policies are often the smartest choice for drivers who value long-term stability, minimal policy maintenance, and simplified budgeting thanks to predictable premium payments. This option appeals to those with steady driving habits and little anticipated change in their vehicle, household, or location over the next year.

In essence, 12-month policies allow you to “set it and forget it” right up until your renewal time the following year. That not only translates to no need to take precious time out of your busy schedule for maintaining your policy every few months, but also no need to worry about policy changes that could come in the form of unwelcome rate increases and coverage surprises.

Is a 12-month policy right for you?

When deciding if a 12-month policy is your best fit, consider the following: 

• Budgeting needs:
  If you want stable rates for a longer period, a 12-month policy is a smart move.

• Driving record:
  If you have a good driving record, you can lock in a lower premium for an entire year.

• Rate stability:
  If you live in an area where rates increase frequently, locking in a 12-month policy protects you from sudden increases.

• Convenience:
  Consider whether you prefer to set it and forget it with fewer renewals or want to shop policies more often.

• Discounts:
  Some insurers offer discounts for policyholders who pay their premium in full upfront rather than monthly. And no risk of missing monthly payments means more peace of mind. This is typically available for 12-month policies.

. . . . .

Ultimately, choosing the best auto policy length is about making your coverage work for you. By talking with your insurance agent at AAA, you can explore whether a 12-month policy could give you the protection that best fits your budget, driving habits, and lifestyle. An annual auto policy could be your key to stability, simplicity, and savings.