What does a six-month auto insurance policy mean?

If you purchase a six-month auto insurance policy, you’ll be covered by your agreed-upon limits at your agreed-upon rate for a full six-months. Once the term ends, your policy is up for renewal and your rates are reevaluated. The national average for six-month auto insurance is $515, but some companies offer a 20 percent discount if you pay your policy in full. Compare companies and quotes here to find cheap six-month auto insurance.

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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insuranc...

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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, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com and Safeco. He reviews content, ensuring that ex...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Jul 16, 2021

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Things to Remember

  • One benefit of a six-month policy compared to a 12-month policy is that you can qualify for discounts sooner, and you can change providers sooner if you are unhappy with your company.
  • The length of your auto insurance policy only minimally impacts your six-month total policy premium. Your driving record, age, vehicle make and model, and the state you live in will have a stronger impact on your insurance costs.

It’s no secret that auto insurance companies charge different rates. But did you know auto insurance companies also offer different term lengths? Most policies will cover you for either six or 12 months.

Purchasing a six-month total policy means you will be covered by your chosen limits at your agreed-upon rate for six months. After that period ends, your rate will be recalculated by the insurer, and your rates will change accordingly.

You then have the option to renew your policy, or shop around for cheap auto insurance from a different provider if you’re unhappy with your insurer.

Read through our brief guide all about six-month insurance policies to learn how your rates are calculated, what you can do to keep your rates low, and if a six or 12-month policy is right for you.

Start comparing six-month auto insurance rates right now by entering your ZIP code into our free quote tool above.

What does policy mean?

In terms of auto insurance, the policy refers to the agreement that is made between you and the insurance company. This policy determines what claims the insurance company is required to cover.

A policy also includes the price that you will pay and the length of that policy term. For auto insurance, the policy typically lasts between six months and 12 months.

Make sure to find a policy and term length that works for you and your budget.

How does a six-month auto insurance policy work?

Auto insurance is legally required in 49 states. Depending on what state you live in, you will be expected to purchase at least a minimum level of coverage to drive on the roads.

Most providers sell six-month auto insurance policies. However, some will sell 12-month policies.

How does six-month auto insurance work? A six-month insurance policy simply means that you will be covered by your agreed-upon limits at whatever rate your insurer provided for you in your contract for six full months.

When that six-month term ends, your provider will reevaluate your rates.

You can purchase a term-length of six-months for auto insurance but make monthly payments for the duration of your policy. You do not have to pay for all six-months upfront. But some companies will provide you with a small discount if you do choose to pay for your policy in full.

Depending on your driving record, the number of claims you filed, and a few other major factors, your rates will either increase, decrease, or stay the same.

You also have the opportunity to change providers without paying cancellation fees if you are not satisfied with your current provider.

Just be careful. You must maintain continuous coverage or else you risk getting caught driving without insurance. Therefore, if you are considering changing providers, it is better to secure your new policy first before canceling your old policy.

How much does six-month auto insurance cost?

Is it possible to find cheap six-month auto insurance?

In the following table, we compare the average cost for six-month rates compared to annual and monthly rates. Check them out below.

Average Auto Insurance Rates for Different Term Lengths by Company
CompanyAverage Monthly Auto Insurance RatesAverage Six-Month Auto Insurance RatesAverage Annual Auto Insurance Rates
State Farm$272$1,630$3,260
American Family$287$1,722$3,443
Liberty Mutual$506$3,037$6,073
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What is the average cost of six months of auto insurance? According to the National Association of Insurance Commissioners, the national average cost for full coverage auto insurance is $1,030 per year. Therefore, the national average for six months of insurance is $515.

You can break these rates down further to discover the average monthly cost for full coverage auto insurance by dividing the annual average by 12, making the estimated monthly rate about $86 per month.

However, your actual six-month auto insurance quote could look very different depending on a variety of factors.

Auto insurance companies will charge you more or less when calculating your individual rates. Depending on where you live, your age, gender, ZIP code, the type of vehicle you drive, your credit score, and your driving record will all be factored in.

As you’ve learned, there are many different factors that go into calculating auto insurance rates. To complicate things further, each state has different laws and regulations surrounding how companies can determine costs.

For example, some states have banned providers from using gender, credit history, and ZIP codes.

Therefore, looking at average rates for auto insurance is a little misleading because there are so many changeable factors involved. Rates are calculated differently by every insurance company.

The policies themselves can also vary and will affect the rate. So think of these numbers as helpful guidelines.

For example, we provided you with average six-month full coverage rates, but there is no universal definition for what a full coverage auto insurance policy actually is.

Customarily, full coverage implies that you are carrying your state’s minimum car insurance requirements, along with collision and comprehensive coverage.

However, the deductible you choose for collision and comprehensive coverage can change, which will impact your rates. The levels you purchase can also be different.

You might even have additional coverage options on your policy that are unique to your company, like roadside assistance, GAP insurance, or rental auto reimbursement.

Why do most auto insurance policies only last for six-months?

When you seek out an auto insurance quote, you’ll find most companies will provide you with a six-month term length. In fact, it can be quite difficult to find a 12-month policy. Some major companies, like GEICO, will not even sell them.

There are a few reasons for this, some benefit the provider, and some benefit you as the consumer.

One major reason that benefits the provider is that it allows your rates to be reevaluated more often. In some cases, your rates might increase. For example, if you’ve filed multiple claims, or if you committed a driving violation, your rate will go up.

Rather than waiting a full year to readjust your rates, the provider will be able to do it after only six months.

In other instances, your rates might actually go down. This is, of course, a benefit to you, the consumer. The shorter-policy length allows you to qualify for discounts sooner, and readjust your coverage levels.

Similarly, if you want to change providers without paying any cancellation fees, it’s easier to wait until the end of a six-month policy than a 12-month one.

Ultimately, six-month policies are the norm because of the ability to perform routine price evaluations and make regular updates and changes to your driving profile. Therefore, the shorter six-month term policy length often ends up being more beneficial for both the driver and the provider.

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Does your auto insurance policy length dictate the coverage period?

The length of your auto insurance policy is going to dictate the coverage period. In other words, how long you are protected by your insurer. There is no standard length of time as to how long an auto insurance policy is going to be written. However, the most common term length is six months.

Some auto insurance companies can write you a policy that is in effect for just a day, while others may write you a policy that is in effect for one year or even longer in some instances.

For example, if you rent a vehicle, the agency will likely ask if you want to also purchase an auto insurance package to protect the rental car. This policy will last for as long as you are renting the car, which could be anywhere from one day to six months.

All in all, how much you pay for auto insurance depends more on the company you use and your individual demographics as a driver, and less so on the term length you choose. However, some companies will provide you with a discount if you’re able to pay for your policy in full.

It is often easier for most consumers to pay for a six-month policy in full compared to a 12-month policy.

In the table below, we provide you with details about what auto insurance companies give this kind of discount. If the specific savings amounts are available, they’ve been included.

Full Payment Auto Insurance Discount Available By Company
CompaniesFull Payment Discount Available
21st CenturyNo
AllstateYes -10%
American FamilyYes
AmicaYes - 4%
Country FinancialYes
EsuranceYes - 10%
Liberty MutualYes - $5
Safe AutoYes - 5%
SafecoYes - 15%
State FarmNo
The GeneralYes - 8%
The HanoverYes - 15%
The HartfordYes - 20%
TravelersYes - 7.5%
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Out of the 22 providers we compared, 17 of them offer a pay-in-full discount. Remember, your auto insurance discounts stack. Take advantage of these savings.

If your provider does not offer this discount, consider comparison shopping to see if a different company might be a better fit for you.

Why should you pay attention to effective auto insurance dates?

The length of your auto insurance policy is driven by the effective dates of said policy. Therefore, if you have a six-month policy and it goes into effect on January 1st, then you’ll be covered by that policy until June 30th of the same year.

In other words, a full six-months. A 12-month policy will terminate on December 31st of the same year.

When you submit an auto insurance payment, you are basically paying for coverage in advance. Let’s say you purchase a six-month auto insurance policy and are able to pay for the full term upfront.

For the next half-year, you’ll be covered by a policy you’ve already paid for.

Now let’s imagine you purchase a six-month policy but decide to make monthly payments; the same logic applies.

If you pay your fee on January 1st, you are covered for the full month of January. In February, you will have to submit another payment to keep your coverage for that month.

Your rate will not change, however, because you’ve entered a contract with your insurance provider guaranteeing that you will receive the agreed-upon level of coverage for the agreed-upon rate. It will be set in stone until your policy term ends at the end of the six months.

Your payments can be due on any random day of the month. This means some effective dates are not going to be as black and white in terms of starting on an easy date like January 1st.

Make sure you know your specific due dates so you never miss a payment. If you miss a payment, you risk losing your coverage because of a breach of your contract.

Most companies will give you a limited number of days to make your payment before dropping you. You must make the grace period car insurance payments on time in order to maintain coverage.

That being said, don’t worry too much about a surprise termination of coverage. According to the Insurance Information Institute, your provider legally must send you a letter ahead of time explaining to you exactly why your coverage is being terminated, and on what date.

Is a six-month or 12-month auto insurance policy cheaper?

The term length you choose for your auto insurance policy may have a small impact on your rates, however, it will be minor. Therefore, choosing a six-month policy over a 12-month policy will not necessarily help you substantially lower your costs.

To find a progressive rate quote, make sure to shop around and compare rates and levels of coverage between companies.

What are the pros and cons of six-month and 12-month auto insurance?

A con to a six-month insurance policy is your rates can change after that six months.

The real benefits of a 12-month policy are not about cheaper upfront rates. What actually draws drivers to purchase a year-long auto insurance term length is the lack of surprises.

For a full year, you know with certainty that your auto insurance costs will not change. For drivers who pay for auto insurance in monthly installments, this can be a huge plus.

A common complaint we hear is, “Why does my auto insurance go up every six months?”If you invest in a 12-month policy, you will no longer feel that frustration. Your rates will be re-evaluated every 12 months instead.

During rate reevaluations, auto insurance companies will increase your rates because the company might be dealing with more claims from other customers.

Your driving choices can also cause your rates to go up. For example, if you committed any traffic violations, your rates will likely increase.

An advantage to a six-month policy is that you can get a discount faster if your circumstances change. Your policy is much more flexible with a shorter term.

One downside to a 12-month policy term is that you’ll have to wait longer to apply for discounts to your policy. This might mean you’ll be stuck paying slightly higher rates until your policy is up for renewal and reevaluation after a year’s time.

For example, if you now work from home and are considered a low-mileage driver, you will have to wait until the end of your year-long term to qualify for this discount.

Auto insurance policies come with all different coverages and terms, as well as effective periods. When you are shopping for your insurance policy, be sure to ask what the length of your policy term is and when it will go into effect.

Do some comparison shopping so that you can find a policy that is packed with value, coverage, payment terms, and the customer service you deserve.

By taking some time to consider the pros and cons of each term length, you’ll be able to choose the policy that best fits your individual and personal needs.

You’re ready to find affordable six-month auto insurance quotes and we can help. Simply enter your ZIP code into our free quote comparison tool below to compare six-month auto insurance quotes.

Frequently Asked Questions: What does a six-month auto insurance policy mean?

You are now an expert on what constitutes a six-month total policy rate. Refer back to this guide as much as needed while you comparison shop for your best six-month auto insurance rates.

Did you think of something we missed? Check out our frequently asked questions below for even more information.

#1 – Does Progressive offer a six-month policy or a 12-month policy?

Progressive has recently adopted 12-month policies for its customers. However, you have the option to also choose a Progressive six-month policy.

#2 – Is it better to pay auto insurance monthly or every six months?

That’s up to you as the customer. For some budgets, paying monthly is easier than paying for the entire six-month policy at once. However, many companies provide discounts if you do pay in full. Ask your agent for more details.

#3 – What auto insurance companies offer 12-month policies?

Some auto insurance companies that offer 12-month policies include Liberty Mutual, USAA, Erie, The Hartford, MetLife, The General, Infinity, Kemper Speciality, SAFECO, and Unique.

#4 – Does GEICO offer 12-month auto insurance policies?

When you get a GEICO quote, it will be for a six-month auto insurance policy. GEICO has stopped using 12-month auto insurance policies.

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