Reasons for Mid-Contract Auto Insurance Rate Changes

Mid-contract auto insurance rate changes generally occur when you move, get a new car, or opt to buy more coverage. Otherwise, your rates shouldn't go up in the middle of a policy term. Insurers update your rates at the end of each term and issue a new rate when you renew.

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Rachel Bodine graduated from college with a BA in English. She has since worked as a Feature Writer in the insurance industry and gained a deep knowledge of state and countrywide insurance laws and rates. Her research and writing focus on helping readers understand their insurance coverage and how to find savings. Her expert advice on insurance has been featured on sites like PhotoEnforced, All...

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Written by Rachel Bodine
Feature Writer Rachel Bodine

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 and Safeco. He reviews content, ensuring that ex...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent Daniel Walker

UPDATED: Jun 13, 2022

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Things to Remember

  • Throughout the year, you have the flexibility to make adjustments to your insurance coverage
  • You must inform your auto insurance company if you buy another car, which could result in changes to your auto insurance premium
  • An auto insurance company can only make changes to your premium mid-contract if you are convicted of fraud, miss payments, or have your license revoked

Your insurance company is bound by the terms of your contract, and they can only legally make adjustments for certain reasons. On the other hand, as the purchaser, you have more flexibility in modifying the contract provided you understand any conditions that might restrict revisions in specific instances. What are some reasons your car insurance rates might change mid-contract? Read on to find out.

What are some reasons to change your auto insurance premium?

Multiple situations may cause your insurance premium to change before your contract term is over. Some of the most common reasons for insurance rate changes include:

  • Changing the usage of your car, for example, increasing the monthly mileage
  • Removing an existing driver or adding a new one
  • Changing your address
  • Adding a new car or removing an old one
  • Changing the coverage limits 
  • Modifying your car in a way that increases or decreases its value

Mid-policy changes are rarely an issue. Insurers know customer needs can shift rapidly and that these adjustments don’t often occur at the exact moment when a car insurance policy is up for renewal.

Most of the time, all it takes to change your insurance policy is a quick phone call or visit to your auto insurance company’s website. You may even need to start over with a fresh policy at some point. That being said, moving from one state to another may cause you to have to purchase a new policy, even if you continue to use the same auto insurance company.

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Restrictions to Changing Insurance Premiums Mid-Contract

The best auto insurance companies will want to retain your business, so they make it as easy as possible to update your coverage. That being said, while most insurance providers allow customers to make changes to auto insurance policies, you might find some who only allow changes during contract renewal.

Moreover, some changes cannot be made in the middle of your contract, and you’ll have to wait until the contract is renewed. These changes are usually associated with ‘extra’ coverage, such as:

  • Accident forgiveness
  • Replacement of a new car
  • Forgiveness for minor violations

If you have any questions about how changes in your policy may affect you and your rates, contact your insurance company.

Can your insurance company change your rate? 

Now that you know what changes you can initiate, can the insurance company change your coverage? 

Legally, auto insurance providers are required to inform you of any changes to your policy within 60 days from the time your contract begins. After this duration, they can make changes only if you are convicted of fraud, you cease making timely payments, or your license is suspended or revoked.

Does an accident affect your insurance? 

Auto insurance providers cannot reduce or raise your premiums until you renew your coverage. For example, if you have an accident where you’re at fault, your insurance company can’t change your rate throughout the remaining term of the contract. It’s the same for a DUI as well. So long as you don’t commit fraud, lose your license, or stop making payments, your insurance prices will not vary during your contract, even if you are involved in more than one incident.

However, your renewed contract will likely reflect higher rates. Moreover, if you are involved in multiple incidents, they might refuse to renew your policy. If you’re not happy with the increased premium, you can cancel your auto insurance contract and consider switching to another auto insurance company. 

Auto insurance companies consider a lapse in insurance coverage an indication of risk, and you will not get a discount for having prior auto insurance coverage.

You can see in the table below how your rates can increase after a lapse in coverage.

Percent Increase in Car Insurance Rates After Car Insurance Coverage Lapse
CompaniesIncrease in SC After a Lapse in Car InsuranceIncrease in CA After a Lapse in Car InsuranceIncrease in FL After a Lapse in Car Insurance
Liberty MutualN/A16.38%N/A
FarmersN/A in SC11.90%6.89%
NationwideNo quote offered13.10%N/A in FL
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A lapse in coverage can more than double your auto insurance rates.

Final Thoughts on Changing Auto Insurance Premiums Mid-Contract

You may need to change your insurance policy at any time, and most providers understand that these changes don’t always sync with the contract renewal period. There are several reasons you might want to change your coverage, and most likely your provider will allow you to do so. When your existing auto insurance coverage expires, you can change companies.

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