Online Auto Insurance Helps Consumers Weigh the Benefits of Monthly Coverage Payments

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In a new FAQ, the writers at OnlineAutoInsurance.com outline the pros and cons of deciding to go with monthly payments for auto insurance.

In a new FAQ, the writers at OnlineAutoInsurance.com outline the pros and cons of deciding to go with monthly payments for auto insurance.

For many consumers, the prospect of paying for auto insurance on a monthly basis may be tempting; many carriers offer the option, and such plans eliminate the need to come up with a lump sum that covers an entire policy period. But insurance buyers should keep in mind that going with month-to-month installments — although attractive at first glance — could end up costing more in the end. OnlineAutoInsurance.com encourages consumers to use the site's free informational resources and online quote-comparison generator to decide whether monthly coverage is truly the best option.

Many consumers look for monthly car insurance with no down payment so that up-front costs are kept as small as possible. Plans without any initial cost, however, are few and far between, and monthly installment plans, though convenient, may come with extra costs. Insurance policies in which an entire period’s premium is due upon initiation often do not require the policyholder to pay the extra fees that may be demanded of a person on a month-to-month plan. These monthly processing fees can sometimes be around $10, meaning that opting to go month-to-month for a six-month plan could end up costing the policyholder an extra $60 in the long run. And, if any of the payments are late, the consumer could be looking at additional fees.

If consumers do decide to go with monthly installments, they should know the rights that are afforded to them. The Texas Department of Insurance, for example, outlines the rights of month-to-month insurance customers in its Consumer Bill of Rights. In the Lone Star State, drivers have the right to pay the balance in at least 10 equal installments for a yearlong policy and in at least four equal installments for a half-year policy. Also, installment plans extended to Texans cannot contain an initial down payment that is more than the cost of two months’ worth of coverage.

Source: http://www.tdi.state.tx.us/rules/bor-auto-english.html

To access the FAQ and to learn more about the options afforded to motorists looking for manageable coverage, consumers can go to http://www.onlineautoinsurance.com/learn/ where visitors can also fill out a quick form in order to get a range of quotes from a variety of carriers.

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John Pirro
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