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Most insurance professionals will recommend shopping for car insurance every six months. The reason for this is simple — your rate is reflective of you and your surroundings, which change over time. So, you absolutely need to shop around before your policy renewal (every 6 months) to make sure you're paying the best price for the best coverage.
If you’re wondering how to switch car insurance companies, you’ll be happy to know that it’s not as complicated as you might think. Having an idea of how the process works can help to ensure that you get the best coverage. We’ll review how to switch car insurance in this step-by-step article.
Many insurance companies know their customers don't want to go through the trouble of shopping for car insurance. This is why, on average, most companies raise their rates 4-6% every year because their data shows that the threshold isn't high enough to warrant an immediate switch from their customers. Furthermore, if you've had an accident, added a driver or a car, you should expect your rates to be even higher.
Your first step in getting the best auto insurance coverage should be to see what other companies are offering. Here at The Zebra, our online quoting process allows you to get real-time, bindable quotes from different insurance companies on a local and national scale. We take your privacy seriously, which is why we don't even ask for your phone number, making it impossible for us to spam you. Enter your zip code below to get started!
As you start requesting car insurance quotes from other companies, it’s important to start thinking about what your current insurance policy covers and the coverage you’ll need going forward. Do you need collision, comprehensive, and uninsured/underinsured coverage? What’s your deductible? If you’ve just moved to a new state, what is the minimum level of insurance required by your state?
This information can be found on your declarations page of your current policy. You should always keep a copy of this page — also called a “dec page” — on-hand at home. More specifically, you should have your current dec page directly in front of you when requesting auto insurance quotes. If you do not have one at home, request a hard copy via your current insurer or try to access your account online.
FYI, you need comprehensive and collision coverage if:
Before signing up for coverage with a new company, a little research never hurts. The best rate doesn’t always guarantee the best coverage. Does the company have good reviews? Does the rating organization J.D. Power give the company its seal of approval? You can also check with the National Association of Insurance Commissioners (NAIC) to check an insurance company's financial viability, as well as looking into the company’s customer complaint ratio.
Firsthand reports are extremely valuable. If the insurance company has a Facebook page, check out examples of back-and-forth with customers (remember online forums should always be taken with a grain of salt). Is the company responsive after someone files an insurance claim? Are they courteous after a car accident? Chances are that the way a company responds to other customers is how they will respond to you.
Make sure your current discounts will carry over to your new company. Telematic and bundling discounts are typically the ones that will not automatically transfer — as a good driver discount might. If you are going to bundle, which is recommended, make sure you get a renters/homeowners quote with your new company. Telematics works a little differently based on your chosen company.
Some insurance agents advise to you call your old company before canceling — which you're encouraged to do for a few reasons. First, ask if there are any cancelation fees. Depending on your company and when you cancel your policy, you can be charged a cancelation fee. Next, ask for a policy review. A policy review is basically a check-up on your current plan. You can speak with a company representative who can scan the policy for any discounts for which you qualify that weren’t available when you originally joined. Also, make sure that you aren’t being charged for tickets or accidents that should have by now fallen off your record.
However, if you're calling to "price match" with your new provider, you're out of luck. Because of the way insurance is regulated, car insurance companies do not negotiate — even if you've been a loyal customer for years. In the end, your current company might already be giving you every possible discount on your insurance premium. Still, it never hurts to ask.
No matter if you choose to transfer your car insurance policy to a new company or re-up with your current insurer, do not let your coverage lapse. Car insurance companies look closely for lapses in coverage, and you could be penalized for even the smallest of gaps. Another important consideration: driving without car insurance in the US is illegal in almost every circumstance. Learn here how best to cancel your coverage.
You’ve got a new policy, a better insurance premium, and maybe even improved coverage. With this comes new ID cards and a new dec page.
Make sure to keep your documents where you can find them. You’ll need your dec page if you want to review your policy limits and coverage. Also, have your ID cards handy in case you get pulled over, are involved in a collision, or purchase a new vehicle. Most larger insurance companies have an app that allows you to store or download policy documents, but having printed copies is never a bad idea, as a lost phone or some other technical glitch could prove problematic.
Switching insurance companies can seem daunting, but that shouldn’t keep you from finding the best insurance rate possible. Take it one step at a time and you'll be driving around with the coverage you need — hopefully with a little extra change in your pocket.
If you have just purchased a policy with a new car insurance company, you’ll need to cancel your previous policy to avoid overlapping coverage. While each car insurance company has its own specific policy cancellation protocol, have a look at these basic guidelines to see how the car insurance cancellation process works.
If your old company fails to cancel your coverage and you're still being charged, call them immediately. Your new policy information (with policy inception date) should be all you need to effectively cancel the policy. If you were charged an unnecessary premium, you can be refunded back to the start date of your new policy.
Canceling car insurance because you're no longer driving?
Maybe you’ve moved to a city where having a car is more of a burden than a convenience, or perhaps you’re just tired of the expenses associated with maintaining a car. For these purposes, canceling your insurance coverage follows much the same process as above. However, depending on your insurer, you may be required to show a bill of sale for your previously insured vehicle if you are not providing new proof of insurance.
That said, if you plan to continue driving at some point in the near future, canceling your car insurance might not be the best idea. Car insurance companies like to see continuous coverage when putting together your policy. A lapse in coverage may cause your rates to increase in the future. If you think you may be going carless for a few months, consider a non-owners policy to maintain your coverage.
If you're moving within your state, you may be fine by just updating the address on your old policy. Keep in mind: moving to a different zip code will impact your premium. Because risk is calculated at the zip code level, you should expect your premium to change whenever you move. For example, if you move to an area with fewer accidents and drivers, insurance companies would view that area as less risky and thus your premium would lower.
Regardless of whether or not you switch insurance carriers, it is mandatory to update your address. This is especially true if you move states, as each state has its own insurance laws. Not updating your information can lead to having your claims denied or being dropped from your current coverage altogether.
Learn more about how to handle car insurance when you move between states.
Yes, you are allowed to switch auto insurance companies with an open claim. As long as the incident occurred while you were covered by your previous insurance company, the insurer will still pay out your claim.
Insurance companies don’t penalize you for switching your car insurance with an open claim. Stay in contact with your previous insurer until the claim is settled. Keep in mind some claims can have an impact on your rates.
If you’re looking for the best car insurance rates, comparing different companies is a no-brainer. Whether you plan on switching car insurance companies mid-policy or waiting until your current policy ends, getting the best coverage doesn’t have to be complicated. Start the process by gathering free car insurance quotes by entering your ZIP code below and you could enjoy a better rate before you know it.