As soon as you discover you aren't going to be able to make your car insurance payment on time, it is essential that you speak with a company representative to make other arrangements. If you don't, you could incur late fees, and more importantly, risk the policy being canceled. Depending on your situation, you may have options for a grace period or hardship assistance.
Your car insurance company's specific policies determine whether you can get an extension. You may be able to get a grace period, have your premium temporarily reduced or change the date your payment is due.
Ask About a Grace Period
Insurance companies are not obligated to give customers an extension on their payments; however, some do offer a grace period. This grace period can be anywhere from a day to 30 days. Contact the company directly to find out if this is an option for you, and if so, what steps you need to take to be granted that grace period. Make sure to submit your required payment before the grace period expires.
Explain Any Hardships
When speaking with a company representative, be sure to let him or her know if you are suffering any financial hardships. The company might have a program that can help. Nationwide has what it calls an "extraordinary life circumstance process" that works to lower your premium if you can prove a divorce, death in the family, military deployment, injury or job loss. The program is available in all 50 states.
Know the Payment Policies
To avoid a late payment, it is a good idea to review the insurance company's payment policy. For example, some businesses require the payment to be received by the due date listed on the bill, but companies such as Progressive will consider the payment on time if it is received late but has the payment due date postmarked on the envelope.
Get a Different Payment Plan
If you're having trouble making your car insurance payment because your payments are due every six months or once a year, contact the company and request a different payment plan. Maybe a quarterly or monthly payment plan would be best for you since you wouldn't have to pay such a large sum of money all at once. State Farm, for example, offers monthly payment plans and also allows customers to pick the due date for their premiums. This way, if the majority of your bills are due at the end of the month, you can choose to make your payments at a time when you are more likely to have the funds to make the payment on time.
Use Bill Pay Reminder Notifications
You might need an extension simply because you forgot that your car insurance bill was due. To avoid this problem, take advantage of the company's bill pay reminder notifications. This is easy to set up in your company's online portal after signing in to your account or going through the company's mobile app. When you receive the notification, you'll know it's time to prepare to make the payment.
- Peachtree Financial Solutions: Missed a Car Insurance Payment? Here's What to Do
- State Farm: Insurance Payment Plans
- GEICO: Billing and Payment FAQs
- AutoInsurance.org: Can I Get an Extension on My Car Insurance Payment?
- Nationwide: Insurance FAQs
- U.S. Department of Labor. "FAQs on COBRA Continuation Health Coverage for Workers," Page 8. Accessed July 25, 2020.
- HealthCare.gov. "Premium Payments, Grace Periods & Termination." Accessed July 25, 2020.
Alicia Bodine is a New Jersey-based writer specializing in finance. With more than 13 years of experience, her work has appeared in LendingTree, GoBankingRates, Sapling, Zacks and budgeting.thenest.com.