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How Can I Change My Car Insurance?

Finance | 06/26/2023 15:25

There are a number of reasons why a person may want to change their insurance carrier. Maybe they are unhappy with the coverage or the customer service, or maybe they just found a better premium elsewhere. 


Here’s how you can change your car insurance. 

How often should you change car insurance?


You should get in the routine of comparing car insurance premiums about once a year. This will help ensure that you are always getting a good premium. You do not need to wait until your policy ends to switch. You should actually make sure that there is some overlap so that you do not risk being without insurance, even for a day. A lapse in insurance can open you up to a lot of risk.


While you shouldn’t necessarily change policies every year, a yearly check in will help to make sure the premiums are staying competitive.

When should I change my car insurance?

There are a number of things that may happen in your life that will tell you that it is time to change insurance. 


You moved.

If you move to a different zip code, chances are your premium will be affected. You need to notify your insurance company when you move, even if it is just a temporary move. Your location is a key factor when determining premiums. So when you move it is a good idea to look around the area and see if you can find a better premium elsewhere.


Your premium has increased.

When it’s time for your yearly renewal, you may see an increase in premium. This is why we recommend comparing prices every year. If you notice an increase there is a good chance you may be able to find a better premium elsewhere.


You have a major change in your life.

Because insurance premiums are calculated based on a number of factors, many life changes can affect how much you pay. Getting married, starting a new job, and buying a new home may all affect your insurance premium. Looking around and comparing coverage can help ensure you don’t pay too much.


Your child begins driving.

When your child finally gets on the road, it is scary for a lot of reasons. And one of those reasons is the increase in insurance premiums. Inexperienced drivers tend to have higher premiums because they are more of a risk on the road than other more experienced drivers. So when it’s time to get them insured be sure to look around and compare your options. Some insurance companies cater more to younger drivers and have better good student discounts than others. 


You buy a new car or get an additional car.

Insurance premiums depend largely on the vehicle you drive as well. A new car can change your premium significantly so it’s best to check in and compare whenever you get a new vehicle.

What are some car insurance terms I should know?


Before we get into changing policies, let’s go over some of the terms you should know when it comes to car insurance.


Automobile Insurance: Insurance that protects against losses involving automobiles. Car insurance policies vary greatly from policy to policy and company to company. The coverage will depend on the state requirements and the wants of the policy holder. Liability for bodily injury and property damage, medical payments, uninsured motorist, comprehensive, and collision are some of the common coverages of car insurance.


Comprehensive Coverage: Pays for damage to your car caused by a reason other than collision. Fire, vandalism, flooding, etc all fall under this coverage. 


Collision: Pays for damage to your car caused by contact with another vehicle or with another object (tree, sign, structure, person, etc). 


Deductible:  The amount that the policyholder is responsible to pay before the insurance begins to pay (applies to comprehensive or collision coverage only).


Liability Insurance: Coverage for a policyholder's liability if they cause an accident that results in injuries and/or damage to other persons or property. 


Loan Gap CoverageThis covers the difference between the value of the car and the amount a person owes to a lender if the car is financed. 


Medical Payments Coverage: Covers medical costs resulting from an auto accident for anyone in your car (you and your passengers) regardless of fault.  


Personal Injury Protection: Covers medical treatment, lost wages, or other accident–related expenses. 


Policy: An insurance contract between the insurer and the insured.


Premium: The price of insurance policy, typically paid every year.


Surcharge:  An extra charge added onto the premium by an insurance company. This usually happens when there is a moving violation or at-fault accident. 


Uninsured Motorist Coverage: Provides coverage for a policyholder when there is a collision with a driver who does not have insurance (or sufficient liability limits) to pay for damages.

How to change your car insurance.

When it’s time to change your insurance policy you can follow these simple steps. 


Compare policies.

When you look at insurance policies there are a number of things that you need to compare. First things first, be sure that you enter accurate vehicle information when comparing policies. A VIN number will help ensure that the policies are accurate. Be sure to look at the following:

  • Coverages. Look at what is specifically covered under each policy. Do they have the same coverages (collision, medical, uninsured, etc)?

  • Deductibles. You will have a choice of deductibles which will affect the premiums you are offered. Making sure that you have the same (or very similar deductibles) will help you compare the policies more accurately. 

  • Liability limits. You will also need to compare the liability limits to ensure that the policies are covering similar things. 

Compare insurance companies.

Additionally, think about the insurance company itself and not just the policy. Are the customer satisfaction ratings high? Do they pay out claims or do people seem unhappy with how payouts work? 

Select your policy and avoid a gap.

When you find the policy that is right for you, be sure to start your new policy before canceling your old one. Avoiding a gap in coverage is very important. Your new company is typically not allowed to cancel on your behalf, so it will be up to you to cancel it. 


Cancel your old policy. 

When you call to cancel your old insurance company may require proof of new insurance. They will then cancel your policy and refund you any money that remains on your premium. (If you are only 6 months into your 12 month policy, they will refund you half of your premium minus any cancellation fees).

That’s how you change insurance companies.

Changing insurance companies can save you a lot of money, and so can refinancing your car loan. Contact Auto Approve today for your free quote!


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