You can change your auto insurance anytime if you’ve had your current coverage for a few weeks or several years. In this post, we’ll go over the five steps to switching car insurance and the possible causes of your decision.
It pays to compare car insurance quotes from several providers because the best car insurance company for your neighbor may not be the best option for you.
Why do I need to change car insurance?
If you switch car insurance providers, your monthly premium may be lower. But this is not the only reason you might decide to change insurance. Some additional reasons are:
- You’ve moved, so your premium has increased
- You bought a new car
- Your child received their license
- Someone driving your car entered or left your home
- You got married or bought a house
- You’ve reduced your driving due to a change in circumstances, such as working from home or becoming a parent
- Your credit score had an improvement or decreased significantly (credit does not affect rates in California, Hawaii, or Massachusetts)
These circumstances have one thing in common: your driver profile has changed. Even a small change in your zip code can impact your rates for auto insurance companies.
Each vehicle insurance company has a formula for calculating premiums based on several characteristics. For example, once you get married, other companies might offer better rates even if you have a cheap provider when you have coverage alone.
The process for changing companies
Sometimes, switching vehicle insurance companies may not be a wise decision, although doing so may have its advantages. For example, you may not be allowed to switch companies if you have recently had a claim.
Your new auto insurance provider may not be able to accurately assess your policy if the claim has not yet been settled and paid. Suppose you did not inform your new company about the pending claim. In that case, it could result in a rescission for misrepresentation and a significant increase in the cost of renewing your new policy.
Because of the above point, knowing the best procedure for making an auto insurance change is necessary. The steps can be simple and quick if the proper steps are followed.
Find different options for coverage
Low car insurance can leave you financially vulnerable, but having too much coverage can cause you to overspend. For example, paying the higher premiums associated with a full coverage policy may not be worth it if you drive an outdated, low-value car.
You may want to change your auto insurance if you spend too much. Ultimately, your auto insurance policy will cost more the more coverage you add.
Understanding the many types of auto insurance coverage and which ones you require is a crucial first step if you are wondering how to change auto insurance.
Consider the potential penalties
Suppose you determine that changing auto insurance is the best option. In that case, you may want to see if there are any penalties, such as a cancellation fee, because you made the vehicle insurance change before the end of the coverage period.
Fortunately, there is usually the option to terminate your auto insurance policy at any time, as long as you give adequate notice. While most auto insurers will probably refund any unused payments, some may impose a cost if you decide to cancel in the middle of your policy term.
Ask your representative if the company has any special cancellation policies before canceling your insurance, or talk to your company’s customer service team.
Make comparisons of different insurances
If you’ve decided it’s a good idea to switch companies, the first thing you should do is get quotes from several auto insurers. You should get a minimum of three quotes when shopping for coverage, according to the Insurance Information Institute (Triple-I).
You can do this to evaluate the costs of different auto insurance policies and your coverage and discount options. Just be sure to get quotes for the same coverage to compare premiums.