If you own a car, then you must have some type of car insurance. This is required in nearly every state, and is an important way to protect your assets. However, if your insurance premiums are due yearly or even at six month intervals, the cost can be somewhat of a shock to your pocketbook. While this can work for some people, many people prefer to arrange to have their car insurance payments due on a monthly basis.
If you use a monthly budget to determine your income and expenses, it can be somewhat of a challenge to save the money that would be necessary for the six-month or yearly premium. For some people, it is too easy to spend money if it is in the account because they forget that it is earmarked for some other purpose. If this has ever happened to you, you know how challenging it can be to come up with the large amount needed for a yearly car insurance premium if you have already spent that money on something else.
Insurance companies understand the realities of living and making it from day to day when you are on a tight budget. This is why many of them are willing to work with people to divide the yearly premium up into monthly amounts. Sometimes, they will charge an extra monthly fee for this service. If this is the case with your insurance company, you may want to shop around for another that does not charge a fee for this service. Also, many banks as well as car insurance companies and others are beginning to charge a fee if you want them to mail you a monthly statement. You can get around this fee if you go paperless and agree to online statements instead of paper statements. You can always print out the statements from your own computer if you want a hard copy.
If you divide your yearly insurance premium into equal monthly amounts, it is usually much easier to fit into your monthly budget. You can probably set up automatic payments through your own banking institution so that you will know that the payment will go out on time, and this will also save you the time to write a check and the cost of a stamp every month. Many insurance companies can also arrange to withdraw the money directly from your checking account - even if you don't set them up on your bill payment plan. They can have you authorize an automatic withdrawal that will be set up on a monthly basis. Either way, electronic banking can save you time and money when you are paying your car insurance premium or other monthly bills.
As you can see, for many people, switching their insurance premium to a monthly amount makes excellent budgeting sense. Another reason for a monthly payment is that if you decide to switch companies, you will not have to wait for months for your pro-rated refund - you just won't need to pay the next month's premium. Since the insurance market is much more competitive than it used to be, it can benefit you to shop around every once in a while.
If you use a monthly budget to determine your income and expenses, it can be somewhat of a challenge to save the money that would be necessary for the six-month or yearly premium. For some people, it is too easy to spend money if it is in the account because they forget that it is earmarked for some other purpose. If this has ever happened to you, you know how challenging it can be to come up with the large amount needed for a yearly car insurance premium if you have already spent that money on something else.
Insurance companies understand the realities of living and making it from day to day when you are on a tight budget. This is why many of them are willing to work with people to divide the yearly premium up into monthly amounts. Sometimes, they will charge an extra monthly fee for this service. If this is the case with your insurance company, you may want to shop around for another that does not charge a fee for this service. Also, many banks as well as car insurance companies and others are beginning to charge a fee if you want them to mail you a monthly statement. You can get around this fee if you go paperless and agree to online statements instead of paper statements. You can always print out the statements from your own computer if you want a hard copy.
If you divide your yearly insurance premium into equal monthly amounts, it is usually much easier to fit into your monthly budget. You can probably set up automatic payments through your own banking institution so that you will know that the payment will go out on time, and this will also save you the time to write a check and the cost of a stamp every month. Many insurance companies can also arrange to withdraw the money directly from your checking account - even if you don't set them up on your bill payment plan. They can have you authorize an automatic withdrawal that will be set up on a monthly basis. Either way, electronic banking can save you time and money when you are paying your car insurance premium or other monthly bills.
As you can see, for many people, switching their insurance premium to a monthly amount makes excellent budgeting sense. Another reason for a monthly payment is that if you decide to switch companies, you will not have to wait for months for your pro-rated refund - you just won't need to pay the next month's premium. Since the insurance market is much more competitive than it used to be, it can benefit you to shop around every once in a while.
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