What happens if I pay half of my auto insurance?

You can pay half of your annual premium upfront. You can’t pay half of your monthly premium. Failing to make payments in full can have costly repercussions.

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Mathew B. Sims is Editor-in-Chief and has authored, edited, and contributed to several books. He has been working in the insurance industry ensuring content is accurate for consumers who are searching for the best policies and rates...

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance...

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Reviewed byDaniel Walker
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UPDATED: Apr 20, 2020

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Things to remember...
  • In most cases, car insurance companies don’t care how you pay your auto insurance premiums as long as they are paid
  • Being responsible about payment is a core component of managing your auto insurance policy
  • Depending on your auto insurance billing terms and payment options, you may be able to pay half of your auto insurance premium and pay the other half after some time
  • Failure to pay your auto insurance premiums can put you in serious trouble vis-à-vis your state’s auto insurance laws and your personal finances — if you are involved in an accident
  • If you can no longer afford to pay your monthly auto insurance bill, there are certain steps you can take to reduce it. You can drop some optional coverages, change your car, raise your deductibles, etc


Car insurance is a contract. The auto insurance company agrees to protect you from losses that may stem from car accidents in exchange for a monthly, quarterly, semi-annually, or annual payment called a premium. As the insured, you are required to make your payments on time and in full to keep your end of the deal, failure to which you will be held in breach of contract.

Though many auto insurance providers prefer their customers to pay the premium up-front, you are free to choose how you want to be billed as long as you pay.

Car insurance makes sure that you don’t pay for any expenses in the form of medical bills or car repairs with your own money in the event of a covered accident. When looking to purchase car insurance, go online and compare quotes from various providers to increase your chances of landing a better deal.

Negotiating Your Car Insurance Billing Terms

The internet has made car insurance one of the most competitive industries in the world. The competition in the car insurance marketplace has shifted power to the side of the consumer. The customers have a lot of choices when it comes to the terms of billing, premium discounts, and coverage options offered.

As a consumer, you need to ensure that your insurer offers flexible terms when it comes to auto insurance billing. For instance, choose a billing that allows you to pay half of your entire premium if you can’t afford to pay the full amount and you also don’t want to pay in monthly installments. You can always negotiate for favorable billing terms.

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Paying your auto insurance premiums: Up front or installments?

When choosing an auto insurance policy, many drivers put too much focus on the cost and available coverage options. They end up forgetting about other details like billing terms. How are you actually going to make your payments?

Billing terms are important too, having unfavorable billing terms can result in you missing a payment and we all know the consequences of missing your auto insurance payments.

Many people prefer to pay their auto insurance premiums in instalments. Paying in installments is much easier, the payment is small, and you can easily afford it. You can choose to pay in monthly, quarterly, or semi-annually installments. If you opt for semi-annually installments, you will pay half of the total premium when your policy takes effect and the other half after six months.

Is it possible to pay half of your auto insurance premium?

When it comes to paying your premium, you can choose how you want to make your payments as long as you stick to the plan. Semi-annual installments are where the concept of paying half of your premium stems from, and it’s not like the other half is being forgiven — you will still have to pay it after six months.

You can’t pay half of your monthly premium — no auto insurance provider will agree to that. Failing to make your payment in full can have some costly repercussions.

There are a few differences in how auto insurance providers bill their customers. Some are more flexible than others. If your auto insurer isn’t being accommodated, you can switch to another provider.

When looking to purchase a new policy, shop around. Compare quotes from as many providers as you can till you find one that meets all your auto insurance needs and is reasonably priced. Ask about their billing terms just to be sure that you won’t be facing the same problems you had with your previous insurer.

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What if you can’t afford to pay your auto insurance bill in full?

If something happens in your life and you can longer afford to foot your auto insurance bill, it’s time to explore other options. Maybe you need to pay legal fees, you have a large medical bill, or you lost your job, the insurer still expects payment at the end of the month.

Since you can’t pay a fraction of your monthly premium, you will have to come up with ways to cut down your premium to a figure you can afford.

Insurance companies aren’t fond of people who can’t pay their car insurance bills. Your policy will be canceled leading to a coverage lapse. You don’t want that. Here are a few ways to lower your auto insurance bill:

  • Drive a cheaper vehicle – The higher the cost of replacing a vehicle, the more expensive it will be to insure. Driving a cheaper vehicle can lower your premium.
  • Increase your deductibles – The deductible is the amount you will pay towards the settlement of your claim. Choosing a higher deductible reduces the amount the insurer will have to pay in the case of an accident which lowers on your premiums.
  • Drop certain coverages – You can drop optional coverages such as collision and comprehensive. They are expensive and with a cheaper car, you probably don’t need them.

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Shopping for the Best Coverage

Comparison shopping is the most effective way to lower your auto insurance rates. If you are not happy with your current provider, simply switch.

Compare quotes from many providers until you find one that offers the most flexible, reliable, and affordable coverage. When comparing quotes to get cheaper auto insurance, you are only limited by the number of quotes you are willing to compare.

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