How To Switch Auto Insurance Carriers

Posted on: 24 July 2018

There comes a time when your current auto insurance coverage doesn't just cut it for you anymore and you have to switch carriers. If that time ever comes, you should be careful about how you handle the switch. Here are a few tips to follow if you want everything to run smoothly:

Don't Just Go Underground

Failing to renew your auto insurance is not the same as cancelling your policy; neither is failing to pay your auto insurance premiums. Auto insurance companies have specific steps that their clients must follow when canceling policies, and in most cases official notification is required. Therefore, ensure you know how to cancel your policy, and follow the steps to the letter. Don't just go silent on your insurer hoping it will realize that you have canceled your policy. Going underground like that will make you a defaulter with a gap in coverage, which is a pretty dangerous situation.

Ensure the New Policy Is In Place before Cancellation

It's also advisable to have the new policy in place before canceling the other one. Starting with the cancellation of the existing policy is risky because it may take you some time to buy the new policy. Even a small human error can mean the difference between having your policy active today and activating it tomorrow. That would create a small window without auto insurance coverage, and no insurer will honor any claim for accidents occurring within that window.

Understand the Potential Penalties

Some auto insurance carriers apply cancellation penalties for those who terminate their policies before expiration. You need to know how much the cancellation fee is, when it is applied, and what you can do to avoid it, among other things. You don't want to incur a five hundred dollar fine that you could have avoided by waiting for a few days before canceling your policy.

Ask For a Refund

Lastly, many auto insurance companies will refund your unused premiums if you cancel your coverage mid-policy. In most cases, you have to apply for the refund; therefore, don't forget to talk to your insurance agent about it. The refund money can help you pay for your next coverage so that you don't lose much from the cancellation of the previous policy.

Hopefully, you won't have a problem switching your auto insurance carriers and your new coverage will prove better than the old one. Don't forget to consult an auto insurance agent like those with Crowel Agency, Inc. prior to the switch to help you confirm you are making the right decisions.