Auto Insurance Grace Period
Q: The date that I am supposed to pay my car insurance bill is at the end of the month and I never seem to have the money to pay the monthly premium. I’m wondering if there is a grace period on my policy that will allow me to pay a few days later.
AIS Answer: Your problem is not unusual as insurance policies are active from the date you started your policy - which isn’t always the best time of the month for payment. An insurance company will suggest that you pay up front for the whole policy, or, use their payment plan. Some offer grace periods, but it is unwise to use those grace periods unless absolutely necessary.
When your insurance premium is not paid on time it goes into a default status. Many insurance companies will give you a grace period (varying lengths and some won’t), but more importantly they will be sending out a slip warning you of your policy cancellation. Obviously this is why you don’t use grace periods because you’re subject to your whole auto insurance policy being cancelled - and that’s not good.
The best move for people in this situation, and yes I know it’s not fun, is to save enough money to pay for a few months at a time - or the whole 6 month policy. If you can pull that off you’ll be in a much better position.
If you must utilize the grace period, call your current insurance company and ask them how much time you have and if it would be possible to move back the payment date (they most likely will not move it forward) and this might resolve the issue.
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grace periods are non-existent with the cheaper insurance companies. They cannot wait to drop you if you don’t pay.
I have a 10 day grace period but I’ve never needed to use it.