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Your car insurance statements are helpful for you to know the price that you pay for your premium as well as other identifying information about your specific car insurance policy. Most of that information is also accessible through your proof of insurance card or your policy agreement.
The real reason that you would want to keep proof of the payment amount of your auto insurance premiums is if you deducted your auto insurance premium for tax purposes. The longest you would need to keep them is seven years.
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When You Can Deduct Your Auto Insurance Premium on Taxes
Saving your auto insurance statements is really most important for tax reporting purposes. This is typically only applicable if you take a deduction for your auto insurance premium because you have a business expense. If you do not use your car for a business, then there would not be a reason to take a tax deduction for your car insurance premiums.
Even though you most certainly could use a car to commute to and from work, this is not the same as using your car for your business.
Regular commuting miles do not count towards a tax deduction. Unless you have some special use for your car as a part of your job, it will probably not come into play for a tax deduction.
Another thing to remember is if your boss reimburses you for car expenses when you use your vehicle for a work purpose, then you do not have the ability to deduct this travel expense on your income taxes.
If you are audited for reporting the cost of insurance premiums on your taxes, the audit may go back seven years. This is why it is helpful to have a record of your payments for that time period.
However, if you have access to electronic statements through your car insurance company’s website, then you would not need to bother with keeping extra paper copies of the statements on hand.
How to Gather Your Auto Insurance Information
If you are missing information about your auto insurance policy, such as the policy agreement or your insurance card, the best thing to do is get in touch with your auto insurance company. They can either mail or email you all of the relevant information about your policy.
Some auto insurance companies even offer online chat for contacting an insurance company representative. This may be even faster for you than calling your auto insurance company and waiting on hold. If you have a local agent, you could show up at the office in person.
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Payment Information When Switching Car Insurance Companies
You may decide to go to a different auto insurance company because you find that you can get a lower rate by using another company. It is fairly common for drivers to change car insurance companies in the middle of their policy terms.
If you get a new car insurance company, you do not necessarily have to show them proof of your last payment to your previous auto insurance provider.
It might give you some peace of mind to keep a record of your last insurance payment while switching providers because you will know that you have proof of not missing an insurance payment.
Other than getting a lower price, another reason to consider switching companies is if you cannot get the service that you expect. Comparing rates between different companies is important in terms of not paying too much for coverage.
However, paying the lowest price is not the only criteria you should have for going to another company. You also want to make sure that you are switching to a company that is responsive to your needs.
Wrap Up on How Long You Need to Keep Car Insurance Statements
The most convenient way to store all of your car insurance policy information is online. You may still need to carry your physical proof of insurance card with you when driving because you could be stopped by a police offer or caught up in an auto accident.
If you only get paper copies of your insurance statements, you really do not need to keep them past seven years. If you do not take a deduction for auto insurance premiums on your taxes, then there would be no real need to keep copies of your auto insurance statements because you would not have any risk of being audited for that information by the IRS.
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