How to Switch Car Insurance Companies

Start by browsing. Thanks to the Internet, it is easy to browse different policies from different car insurance companies. In fact, there are many sites that allow users to compare policy prices and features side by side. Simply getting a better idea about all of the items that are out there can help you better understand if you truly want to switch car insurance companies or if you may be better off simply sticking with your current company.

Buy the new policy first. It sometimes can take a few days for a new policy to go into effect. It also can take a few days to get all of the proper documentation needed if a new policy is purchased. Because of this, it is important to not cancel the old policy until the documents for the new policy have arrived. Canceling your old policy before buying the new policy sets you up for the risk of driving without insurance or you could be found to be in violation of the terms of your car loan if your vehicle is not properly insured at all times.

Cancel the old policy at the end of the term. This can be done by calling the company. Some companies will allow people to cancel through email, but this is rare. For the most part, when you switch car insurance companies, do so toward the end of the policy you hold with the old company. When you cancel earlier than a couple of weeks before the end of the policy period, you could be viewed as a risk from the car insurance company if you ever gets the desire to switch back at some later point. If you are enrolled in automatic payments, be sure to cancel your policy at the end of the renewal period before the money for the first month of the next period is taken from your account.

Don't be afraid to cancel any time. One of the things that few people realize is that there is no contractual obligation to stay with a car insurance company for any longer than you want to. For example, if you are 2 months into a 6 -month term, you can cancel the insurance at any time without fear of having something show up on a credit report. As long as you are current on your payment when you cancel, you do not need to worry. However, if you cancel before the full term is over, you may have difficulty being approved from the car insurance company should you ever decide you want to switch back.

Don't make a habit out of switching. Many car insurance companies will reward their loyal customers with rate decreases for each term that they are insured with the company. A person who switches companies for immediate short-term relief may miss out on long-term savings down the road.