What You Need to Know When Switching Car Insurance Companies

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Financial advisors recommend comparing car insurance quotes at least every two to three years. If you've found a significantly lower rate on car insurance premiums while keeping all the coverage you want and need, there are a few steps you should follow to ensure a smooth, trouble-free transition to your new coverage.

When should I consider switching car insurance?

If you've kept your car and insurance policy for several years with no claims, but have seen your premiums continue to rise, it's a good idea to investigate quotes from other companies. Insurance companies may provide loyalty discounts ranging between five to 25 percent, so definitely compare your existing company's best rates as well as shopping around.

Other occasions to investigate new insurance rates include a change of address, a new car, or family members joining or leaving your policy. If you're over age 21 and having a milestone birthday, also consider shopping for a new policy. Age cohorts influence insurance risk and rates, so if you're entering a new decade or half-decade of life, you may be able to find better rates from a different company.

It may sound counter intuitive, but if you've received a ticket or had a minor accident , you can also check for better rates. You may find another company willing to provide a better deal after you've experienced a mishap.

Is there a best time to change car insurance policies?

The best time to change policies is on or near the time your coverage is scheduled to renew. You can switch your auto insurance policy in the middle of your coverage period. However, some companies may charge a cancellation fee. You will usually receive a pro-rated refund of your premium that represents the number of days of coverage you haven't used, minus any cancellation fee.

Which steps should I follow when I'm ready to switch car insurance?

If you have found a company that offers the coverage you need for a better price, you should time your switch so you're fully covered at all times.

Check your current written policy to make sure you're following all the specific required steps to switch. Contact your current insurance company as well as the one who'll be providing your new policy. Request confirmation in writing of your final date of coverage with your old policy. Make certain there's no gap between the end of your old policy and start of the new one.

Comparing the best car insurance rates and coverage is easy using InsuranceHotline.com.