The length of time you should retain your car insurance records depends on the type of document and its relevance to your policy or claims. While the general rule is to keep these records until your insurance policy expires and any claims have been settled, there are situations—especially for business owners or the self-employed—that may require holding onto them longer. Below is a detailed guide on how to manage your car insurance documents, provided by Bankrate’s team of insurance experts.
Key Insurance Documents to Retain
It’s crucial to maintain certain auto insurance documents until the relevant policy period ends. Here’s a breakdown of the most important records to keep and how long you should hold onto them:
Insurance ID Card
Your insurance ID card is proof of your active auto insurance policy. It is often required by law to be shown to a police officer or shared in the event of a car accident. You should keep this card for the duration of the policy period, either physically in your wallet, glove compartment, or center console, or as a digital file on your smartphone. Once the policy has expired, this document can be discarded.
Declarations Page
The declarations page of your auto insurance policy provides a summary of your coverage, including limits, types of coverage, and exclusions. This document is essential for understanding your policy at a glance and should be kept in a safe, accessible location—such as a file cabinet or desk drawer—until the policy expires and any pending claims have been resolved.
Claim-Related Documents
If you’ve filed a claim with your car insurance provider, you should retain all paperwork related to the claim, including receipts, repair bills, and correspondence with the insurer. These records should be held until the claim has been fully settled and you’ve received any payments owed. Once the claim is closed, these documents can be safely disposed of.
Monthly Billing Statements
Monthly billing statements should be kept until your payment has been processed or the policy period ends. For personal policies, it’s generally safe to discard them after confirming payment, but if the policy pertains to a business, consult with a tax professional. They may advise you to retain these records for a few years for tax purposes. Keep these statements in a secure location, such as a locked file cabinet.
Safeguarding and Disposing of Insurance Records
When your insurance policy has expired, and any related claims are closed, it’s important to dispose of your documents securely to prevent identity theft or fraud. Shredding physical records is the safest method, while digital records can be deleted after ensuring they are no longer needed. Make sure to double-check that any sensitive personal information is completely erased.
Retaining the right insurance documents for an appropriate amount of time helps ensure you’re prepared in case of legal issues, tax matters, or disputes over claims. By understanding which records to keep and when it’s safe to dispose of them, you can better manage your insurance paperwork and protect yourself from potential risks.
