Lifetime Cost Comparison

The comparison almost everybody makes is between this year’s renewal and this year’s quote. The comparison that matters is between the two total costs across however long you actually keep the policy.

Those are different questions because carriers price new business and renewals separately. This tool projects both forward at rates you supply and reports which is cheaper over the period, and when the ranking flips.

Result

Cheaper over the period

Policy B

Total difference

$1,085

Policy A total: $12,616
Policy B total: $11,532
Policy A final year: $2,637
Policy B final year: $1,847
Crossover year: Year 4
Policy A average: $1,802
Policy B average: $1,647

This is an estimate based on the values you entered. Actual premiums, coverage, eligibility and pricing vary by provider and by individual circumstances.

Increase rates are your assumptions. No carrier guarantees a future rate, and a policy that is cheaper today can be the more expensive one within a few renewals.

Premium by year

Year	Policy A	Policy B	Difference	Cheaper that year
1	$1,140	$1,460	$320	Policy A
2	$1,311	$1,518	$207	Policy A
3	$1,508	$1,579	$71	Policy A
4	$1,734	$1,642	$92	Policy B
5	$1,994	$1,708	$286	Policy B
6	$2,293	$1,776	$517	Policy B
7	$2,637	$1,847	$790	Policy B

How to use the lifetime cost comparison

Enter the first-year premium for each policy.
Enter the annual increase you expect for each - renewal history is the best guide.
Set the number of years you realistically expect to hold it.
Compare the totals, and note the crossover year.

What people use this for

Deciding whether an attractive first-year quote survives a longer horizon.
Comparing a carrier known for stable renewals against one known for discounting.
Budgeting insurance across the term of a loan or a lease.
Deciding how often re-shopping is actually worth the effort.

Worked examples

Every figure below is produced by running this calculator against the example inputs, so the numbers always match the tool.

Aggressive new business pricing

A at $1,140 rising 15% a year against B at $1,460 rising 4%, over seven years.

Cheaper over the period: Policy B
Total difference: $1,085
Crossover year: Year 4

A three-year horizon

The same two policies where you intend to re-shop after three years.

Cheaper over the period: Policy A
Policy A total: $3,959
Policy B total: $4,558

The horizon is doing the work

The same two policies can rank in opposite orders at two years and at seven. That is not a flaw in the comparison - it is the actual answer, and it means the honest first question is how long you intend to stay.

Someone who re-shops every two years should optimise for the first-year price. Someone who sets a policy up and leaves it should optimise for the renewal trajectory, and those are different purchases.

What an increase rate is really measuring

It combines the carrier’s filed rate changes, changes to your own record, and the expiry of any introductory discount. Only the first is genuinely about the carrier, which is why your own renewal history is a better input than any published figure.

Three years of renewal notices with no coverage changes in between will tell you more about a carrier’s behaviour than any amount of comparison shopping.

Methodology and assumptions

What this calculator does, and what it deliberately does not do.

Each year’s premium is the previous year multiplied by (1 + increase). Totals are summed across the chosen period.
Increase rates are assumptions you supply. No carrier guarantees a future rate and this tool has no pricing data.
All figures are estimates produced from the values you enter. This site has no rate feed and no carrier data, so it cannot quote or price a policy.
Nothing you type is transmitted or stored - the calculation runs entirely inside your browser.

This calculator provides an estimate based on the information you enter. Actual insurance premiums, coverage, eligibility and pricing vary by provider and individual circumstances.

This website is not an insurance company, an insurance agency or a licensed broker. It does not sell insurance, does not provide insurance quotes, and is not authorised to give advice about which policy you should buy.

No result produced here is an offer of insurance or a guarantee of coverage. Only a licensed insurer or agent, working from your verified details, can quote or bind a policy.

Frequently asked questions

What increase rate should I use?

Your own renewal notices over the last three years, with no coverage changes between them. Failing that, ask the carrier what their average renewal change has been.

Does this include claims or deductibles?

No. It compares premiums over time only. Bring deductibles and claims in with a coverage comparison tool.

Is the crossover year reliable?

It is as reliable as the increase rates entered. Treat it as a sensitivity test rather than a prediction.

Should I just re-shop every year?

It is a valid strategy with real costs: time, lost loyalty benefits, and the pricing effect of a gap in continuous cover if a switch goes wrong.

Related calculators

More comparison tools on InsuranceComparisonTools.

Browse all 4 tools →

Your numbers