Early Signing Car Insurance Discount

Some auto insurance companies offer an early signing insurance discount that will save you money on your premium for renewing your policy before it expires. Learn which companies offer the discount and how to save the most on your car insurance.

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Chris Tepedino is a feature writer that has written extensively about home, life, and car insurance for numerous websites. He has a college degree in communication from the University of Tennessee and has experience reporting, researching investigative pieces, and crafting detailed, data-driven features. His works have been featured on CB Blog Nation, Flow Words, Healing Law, WIBW Kansas, and C...

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Written by Chris Tepedino
Insurance Feature Writer Chris Tepedino

Laura Walker graduated college with a BS in Criminal Justice with a minor in Political Science. She married her husband and began working in the family insurance business in 2005. She became a licensed agent and wrote P&C business focusing on personal lines insurance for 10 years. Laura serviced existing business and wrote new business. She now uses her insurance background to help educate...

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Reviewed by Laura Walker
Former Licensed Agent Laura Walker

UPDATED: Jun 23, 2022

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The Rundown

  • If you let your insurance lapse and drive without coverage, you may be penalized and end up paying higher rates for coverage
  • Insurance companies will offer financial incentives like discounts to encourage you to renew your policy or buy a new one before your existing coverage expires
  • You need to shop around for a better deal long before your policy’s expiry date

Since almost every state requires you to carry auto insurance by law, you need to either renew the policy you already have or buy a new one from a different insurance company before your current insurance expires. If you buy coverage early, you can take advantage of an early signing insurance discount that many insurers offer as an incentive to remain loyal.

What is an early-signing insurance discount and how do you get it? 

The early-signing insurance discount is an incentive insurance companies use to retain customers. The insurance company will typically offer this discount as you approach your renewal phase, but you may also need to reach out and request it. 

You should look for emails or notices from your insurer in the month before your renewal date, and reach out at least one week before your insurance expires to see if there is an early-signing discount on offer. 

Different insurance companies offer different discounts. The Allstate early signing discount offers 10% off for signing a week early, for instance, and so does Travelers. American Family has a similar discount but does not advertise how much policyholders will save.

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Why Insurers Offer Early Signing Insurance Discounts

Research shows that it is five times (and sometimes 25 times) more costly to acquire a new customer than to retain a current one. In addition, an insurer is at least 60% more likely to sell to a current client. 

That’s why many insurance companies are willing to offer a discount for renewing your policy as an incentive for you to stay. And the discount could be as much as 15% off the total price if you buy another policy at least a week early. 

There is nothing wrong with accepting the discount offer, provided you know you’re getting value for your money.

Shop Around for Rates

It’s important to shop around and compare auto insurance rates before deciding whether to accept the early signing insurance discount from your current insurer. You can do that by using insurance comparison sites and asking for quotes.

When comparing prices for auto insurance coverage, you need to:

  • Provide the same information to all the potential auto insurers and use similar criteria when getting your quote
  • Inquire whether your auto insurance policy can be bundled with other kinds of coverage, like home insurance
  • Start the research process early enough so that your existing policy doesn’t lapse and leave you uninsured.

Typically, shopping around and moving to a cheaper insurer will enable you to save money anyway. You need to weigh that against the early-signing discount before you take it. After all, early-signing discounts are just one of the many auto insurance discounts available to drivers. 

Do your research to make sure staying with your current insurer is the right move. 

When to Renew a Car Insurance Policy

You must review your policy before it’s about to expire and compare the discounted premium costs to the available offers from other insurers.

You should renew your car insurance policy if:

  • You are happy with the coverage you already have and feel you are getting your money’s worth
  • Other insurers are offering more expensive coverage compared to the rates you are already paying for your preferred policy
  • You left your research too late and risk having no coverage if you don’t renew your policy
  • What you will save by taking advantage of the early signing insurance discount is similar to or better than the savings you will see by switching car insurance
  • You can bundle multiple policies, and save more money with your current insurance company

In short, as long as your current insurer is giving you value for money it makes sense to renew your car insurance early and take advantage of early-signing discounts. 

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The Consequences of Letting Coverage Lapse

According to the Insurance Information Institute, around 12.6% of drivers are uninsured, yet driving around without insurance is illegal in most states, which means you will get in trouble if you have no insurance. If you are caught, you risk paying fines, getting jailed, having your vehicle impounded, or losing your license for a while.

If you cause any accidents while driving uninsured you are responsible for any costs for the other party’s loss. This can be expensive, and can even leave you bankrupt. You should always have the bare minimum liability auto insurance required by law in your state, and never let it lapse.

Enjoy The Early Signing Insurance Discount

It would be best to research early and decide whether or not to renew early long before your policy’s expiry date. If you feel you are getting a good deal, enjoy the early signing insurance discount. The time immediately before you renew is when you’re most likely to find cheaper insurance, early-signing discounts, and other incentives to stay with your current insurer, but it’s also a good time to compare auto insurance quotes to make sure you’re still getting the best deal. 

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