3 Signs You Need to Shop for New Auto Insurance in 2024

A new year means a fresh start to most people, and it's a time when many choose to take stock of their finances and plan the changes they want to make. This might include saving more or reducing spending in a certain area. But I have another item you might want to put on your list: shopping for new auto insurance.

If any of the following three situations apply to you, it's probably worth doing. You could save yourself quite a bit of money next year.

1. Your current insurance won't fit into your budget anymore

This one is pretty obvious, but it's important. Everyone needs auto insurance to drive legally. If a driver doesn't have it, they could face fines, vehicle registration suspension, or even jail time. So just dropping coverage if a policy is too expensive isn't a good idea.

Instead, shop around and compare rates from competitors to see if another company can provide the desired coverage at a more affordable price. Or if maintaining the current coverage isn't feasible with any carrier, check to see which insurance company offers the most coverage at a budget-friendly price.

2. You haven't shopped around in a long time

Many auto insurers use a technique called price optimization to squeeze drivers for all they can get. Essentially, the companies evaluate how likely they think a driver is to leave them by looking at how often they shop around for a better rate. Those who the company deems more likely to stick around through thick and thin pay more.

Some states have outlawed this practice, but many have not. Drivers who don't want to worry about this should make it a practice to shop for better rates at least every year or two, even if they don't wind up switching.

3. Your circumstances have changed

Drivers are supposed to tell their insurers about major changes that could affect their policies, such as moving to another state or buying a new vehicle. Failing to notify the insurer of these changes could result in it denying coverage for claims.

Changes like these can raise auto insurance premiums, but they might lower them too. If a driver has a fancy sports car, which they trade in to buy a used minivan, they'll probably see their auto insurance premiums fall. Or if they switch to a hybrid or electric vehicle, they might qualify for car insurance discounts that help them save more.

Drivers might be able to save simply by contacting their current insurer, but it makes sense to shop around, too. The current insurer's offer might not be the best one around. The only way to know is to compare quotes from a few companies to see what's available.

Remember, shopping for auto insurance doesn't mean you have to switch providers. Even if you ultimately decide to remain with your current insurer, you can at least feel confident that you're getting the best possible deal because you took the time to do your research.