Pattie Lovett-Reid

Chief Financial Commentator, CTV

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In many cases, it happens every year. Your auto insurance comes up for renewal and you automatically extend your policy for another year.

The problem with this strategy is that no action is taken at all. Auto renewals are easy, but they can be potentially costly. At the very least, drivers should review their policy before committing for another year. Typical policy notifications will come anywhere from 30-60 days in advance, highlighting the new terms and rates.

But a lot can happen in a year. You may qualify for discounts, and if you shop around, you may find other insurance companies may offer a lower rate. It’s easy and effective for your insurance company, but is it in your best interest? Maybe, but maybe not.

So even if you decide to stay with your current insurance provider, here are a few considerations to make first, according to Ratehub.ca

• Shopping around can save you money. Shopping for car insurance quotes online can be done in as little as five minutes and could save you hundreds of dollars. Taking that extra time, especially when your renewal is up, can help you get the best value for your money.
• Friendly advice isn’t always good advice. Just because you know someone who got an amazing rate from an insurer, doesn’t guarantee you will qualify for the same rate. It’s important to remember that no two insurance companies will rate you or anyone else completely the same, so it’s important to compare the market to uncover the best option for you.
• Always compare. When looking at new quotes make sure you’re comparing the same policy structure, including the deductibles, level of coverage, and any add-ons or endorsements. Also consider any existing discounts you currently have and how they affect your premium, whether they available with your new provider, and if you’re comfortable moving on without them.

You might be surprised at how much money you could save, especially if it has been a while since you shopped around for quotes.

February is Your Money Month at BNN Bloomberg. For more content like this, visit BNNBloomberg.ca/personal-finance.