How To Switch Car Insurance Companies

Matthew Lloyd
February 8, 2021
Matthew Lloyd

How To Switch Car Insurance Companies

There has been a notable increase in the number of car insurance providers in the past few years. Even though the primary purpose of insurance is to make your life easier, that isn’t always the case. 

If you notice, you'll see that no two car insurance companies offer similar coverage and benefits at the same rates. This means that there could be an insurance policy out there that would suit you perfectly at a lower premium. All you need to do is to look for the perfect deal and sign up as soon as possible. 

All car owners should not be afraid of switching companies. Many savvy insurance shoppers even change policies every year based on price changes in the market. Even if you’re happy with your current insurance, there’s always the possibility that you might end up finding even better insurance elsewhere. Your search for new car insurance can also tell you whether you're paying more than what is required. It’s a great way to decide whether or not your car insurance is good value for your money. 

Should You Switch Your Car’s Insurance?

Let’s say you manage to find the perfect car insurance that you’d love to buy. Chances are, your vehicle is already insured. You won’t be able to get the new insurance without canceling your coverage with the old insurance provider.

Aside from a few awkward meetings with your old insurance provider, there are no real obstacles in your way. Many insurance companies even provide individuals that switch over with discounts to encourage more new customers. It’s important to remember that the insurance companies are competing with one another as well. 

Switching to a better insurance policy helps you save more money in terms of vehicle insurance. Most of the time, switching the policy can give you better overall coverage. With more insurance coverage, you’ll naturally feel safer, and it’s a worthwhile investment that everyone should look to make. 

Despite such benefits, many car owners give up hope when it’s time to switch their insurance. They don’t try buying better insurance because they aren’t sure about switching to something new. 

A few don’t do anything while knowing that there’s no harm in switching to a new and better insurance policy. This is because people think that switching insurances is a very complicated process.

You may also hesitate to take such a step if you don’t know how to switch car insurance companies. We advise you don't let your fear stop you from enjoying the benefits of better insurance. 

Given below is a simple step-by-step guide on how to switch car insurance companies. Reading this will give you the needed confidence and will motivate you to take advantage of better insurance right away: 

Switching Car Insurance Companies – Step-By-Step Guide

Let’s suppose you aren’t happy with your current insurance policy. It could be because of high costs or its minimal coverage. You might not have any suitable options to switch to at this point, either. However, you want to find one as soon as possible and switch over without experiencing a gap in coverage.

Following the steps given below can help you in this case:

1- Determine your needs and budget

You should begin with writing down all that you need from an insurance policy. Evaluate your car’s current condition and try to keep only the important coverage options in this list. You can also decide the amount you can afford to pay for car insurance in this step. Doing so can help save time since you’d only be looking for the most suitable insurance options later.

2- Decide if it's the right time to switch

There's no restriction on when you can switch your insurance company. However, doing so at certain points is better and more beneficial than others. Here are some ideal cases for timing when switching your insurance policy:

  • You’re moving to a new place and can find an insurance policy that covers both your new home and vehicle,
  • You’re buying another car and can buy a policy for two cars, hence accessing a discount,
  • Your policy’s renewal date is coming soon, and you’ve paid out most or all of your previous premium.

Alternatively, there are some cases when you shouldn't consider buying new insurance at all. One such case is that you've just renewed your policy. Another could be when you've just had an accident and are dealing with a claim you filed.

3- Check if you’ll have to pay a penalty

Some car insurance companies allow their clients to opt-out at any time during their coverage period. However, a few require prior notice before they can let go of an insured party. It's better to check the penalties you need to pay if you're canceling a policy in the middle of your insurance term. You can wait if the amount is too much.

4- Compare different car insurance providers

You need to compare all the insurance options available to you before settling for one. Don’t just compare car insurance quotes and costs. Rather, see the coverage, validity period, terms and conditions, and the benefits of each too. Drawing a detailed comparison between all the policies can help you pick the most suitable one easily.

Carry out some research on the company you have finalized to be sure of its credibility. Read their rules and regulations before you cancel your current policy. This can help you ensure a smoother switching with fewer complications.

5- Inform your current insurer

You need to formally inform your insurance providers about the cancellation. They can guide you about the procedure and the requirements you need to fulfill to cancel your subscription with their company. Your current insurers may also ask to pay a cancellation fee and submit a written request for policy cancellation. Make sure to follow everything and confirm your cancellation.

You can also ask the company about any refund policy that may have for insurers who leave midway. Claim a refund if you are eligible for it.

6- Ensure no coverage gap

It’s better to sign up for the new insurance on the day you cancel your previous one. This way, you’d have your car covered instantly after the cancellation. Some insurance companies offer discounts to people who ensure no coverage gap. Others require them to sign up for the new policy at least a week before canceling the previous one. Pre-setting the coverage start date with the new insurer is also common.

7- Get a fresh insurance ID card

You need to get a hold of your new insurance ID card right after signing up for the insurance. Some companies let you check your ID digitally and save it on your phone. Ask your new insurers if they offer a digital ID download. No matter what, don't forget to get your new ID card as soon as you can. Not having this ID with you can become a significant hurdle at times. This is why you should give utmost attention to this step.

8- Inform your leasing company

You need to inform your leasing company and loan lenders about your insurance switch as soon as possible after getting your new insurance. Some lenders make it mandatory for their borrowers to buy a coverage policy for the cars. 

Your lenders hold some rights on the vehicle if you haven't paid them the full amount. This explains why you must inform them of the switch as soon as you can. Not informing such people in time about such major changes might lead them to cancel your ownership too. Most of the time, your new insurers can inform the leasing companies of this change on their own. However, you have to ensure that they are informed irrespective of the channel through which they get the information.

Conclusion

Switching your car’s insurance company can be a perfect move at times. It can save your money and can comparatively provide you with more coverage options too. The process of making such a switch is a little long and tiring. However, you shouldn’t be afraid to make a switch if you think you can benefit. Switching your car insurance company is not complicated at all. All you need to do is to be a little vigilant with your choices and carefully compare the quotes and prices from the available options. 

You can visit https://www.officialcarinsurance.com/ to apply for quotes from several auto insurance providers and can compare their pricing easily.