Simply put, switching your car insurance rate could save you hundreds every year.
But, few people take the time to review their insurance coverage. Why? The task is time-consuming and confusing. Changing car insurance can seem like another complicated to-do on a list that’s mutated into an unruly mess.
But it doesn’t have to be a headache!
I promise that by the end of this article you will be equipped with everything you need to make a tactical switch between insurance providers. Using auto insurance quote comparison tools provided by Insurify, you can do all of this:
- Research new coverage options
- Compare auto insurance policies
- Adjust coverage options and unlock discounts
- Choose a new policy
- Make the switch
And you can complete all of these tasks in less time than it takes to make a sandwich. It’s laid out below in four easy-to-follow steps.
Step 1: Evaluate the Need to Switch
First things first: How often should you check?
In a perfect world, you should do this 4 to 6 weeks before the end of your policy period. Because most policies will allow switching even in the middle of a policy period, you can make the change at any time and as often as you want to. At the very least, check once per year.
Of course, there is no reason to change car insurance unless you’re getting something out of the deal. And I don’t just mean cheap car insurance! Each company has a unique set of bells and whistles that can make them more or less attractive to your specific circumstances. And with hundreds of auto insurance options out there, it’s easy to feel a little overwhelmed.
Deep breath. There are essentially only four factors that will determine the need to switch:
A better rate is the most common reason people decide to change their car insurance policy. Companies change. Algorithms change. The market changes. It’s no wonder your costs can change too…sometimes dramatically.
While it’s true that insurance rates differ from company to company, many overlook how life changes might also lower their rate (more on this below).
If you are switching in the middle of a policy, don’t forget to factor in if your current company has any cancellation fees! Additionally, some car insurance providers offer perks or discounts that may be valuable to you. Be sure to take these hidden assets into account when evaluating if a new plan saves you money.
2. Life Changes
Additionally, as life circumstances change, an old policy may have too much or too little coverage for what you need. Here are some common life changes that can have an impact on your coverage costs or needs.
- Changes in your driving record can change your cost of coverage. If you’ve had any accidents or violation that impacts the cost of coverage, you will want to pay attention to how long a company penalizes you. For example, some companies offer accident forgiveness after three years. Others, after five.
- Changes in your household can also mean changes for your current coverage. If you’ve recently gotten married, you may qualify for discounts. If you’ve recently had a child, you may want to increase coverage for bodily injury or, available in some states, Personal Injury Protection coverage.
- Changes with your vehicle should prompt a comparison shop. If you’ve bought a new car, your coverage needs and costs may change. Additionally, a current vehicle’s value may be so depreciated that comprehensive coverage no longer makes sense.
- Changes to your loan status. If you’ve recently paid off your loan, your costs can change. If you had gap insurance, you may be entitled to a gap insurance refund.
- Changes in location can mean big changes in your policy. Moving from a small town to a big city can cost hundreds. Weather can also change your needs. For example, is hail a greater threat where you live?
- Changes in your credit score can also make a difference in the cost of your policy.
- Changes in employer or memberships may offer you discounts on insurance as well.
3. Valuable Perks
When cost saving is at the top of a priority list, it can be all too easy to focus exclusively on the cost of your insurance premium. But a better deal can come in many shapes and forms. Your policy price may actually be the same from one company to the next, but the value can be radically different.
For example, two policies might have the same price. But suppose Policy A includes roadside assistance and discounts on hotel chains. Policy B offers free vehicle history reports and discounts for a new car purchase. If you often travel by car and stay in hotels, Policy A will offer you more value for the same price. If you’re planning to replace your vehicle or buy another vehicle, Policy B will offer you more value.
4. Customer Experience
How’s the customer service at your current provider? Are you able to get ahold of a live person easily? Are the customer service reps helpful and kind? It’s hard to replace great customer service. If you encounter reps who lack knowledge or the ability to care for your needs, you might consider switching.
Customer experience is about more than people-to-people contact. Do you like the technology your current auto insurance company provides? My favorite thing about my company is its mobile app. Not only is it super easy to use, but it keeps an up-to-date insurance I.D. card on my phone. This acts as an added safety net during policy renewal.
Is there a bad time to switch car insurance companies?
Yes. There are times when switching will not be in your best interest. While it never hurts to check, especially if it takes only two minutes, these two circumstances will generally mean that the time is not right:
- You’ve just had an accident. Switching could end up costing you more because your rate typically goes up only at the time of your renewal. So, if there are four months left on your policy, your premium will most likely remain the same during that time.
- You’ve had a lapse or gap in coverage. Typically, if you’ve experienced a temporary lapse in coverage—for example, you missed a payment—it will likely be easier and cheaper to reactivate coverage your current policy.
Step 2: Compare Options—the Old Way vs the Easy Way
Begin with reviewing your current policy. What does your provider need for you to switch? Is there a minimum advance notice or an (unlikely) cancellation fee? Make note of any requirements, as that can affect your policy start date.
If you need to provide notice, the day you begin coverage will need to be planned in advance. Thankfully, companies will allow you to choose the date your coverage begins.
In addition to this research, you should note any preferences you have. Once you know what you need and what you want, you’re ready to begin comparing car insurance quotes.
You can do this using one of two methods:
1. The “Old Way”
Compiling notes may or may not appeal to you. If it does, get your notebook or Excel spreadsheet ready! Using your list of needs, you can make a chart noting the costs, benefits, and pitfalls of each policy.
Simply call or go online to get a quote from each insurance company you are interested in using. Be sure to compare at least five.
2. The “Easy Way”
If that’s not how you’d like to spend your entire afternoon, you can use Insurify. Insurify can help you compare quotes from several car insurance companies in less than two minutes. You can also set alerts and notifications when you create an account.
All you have to do is fill out one form, and Insurify searches for the best car insurance deals for you, providing your options in an easy-to-read list. You can use this list to learn more about each company and quote. There is also a virtual agent available to answer questions. And, you can even purchase your new quote when you’re ready.
Step 3: Make the Switch
Before the Switch
Once you’ve decided on your new policy, it’s time to make the call. While some companies will allow you to sign up online, we recommend making at least one phone call to test the customer service and ask your insurance agent any questions.
Writing down your questions beforehand helps you make sure you be thorough and keep your call short. Here is are some common questions:
- How soon am I able to get my insurance I.D. cards?
- What discounts are available to me?
- How long is the average wait for claim reimbursement?
- Are there extra perks or incentives I should be aware of?
But that isn’t the only phone call you will want to make. Contact your current insurer to see if you can negotiate a lower rate. Don’t be afraid to advocate for yourself. If you’ve been a loyal customer or have had an excellent driving record, you are valuable.
However, there may be many reasons to leave your current company. Doing so properly saves you time, money, and a lot of annoyance. Once you’ve made your decision and your purchase, follow these steps to make sure you make the change as efficiently as possible.
- Review the declarations page. The declarations page is usually the front page of your new car insurance policy. It details who is insured, the address, the policy period, policy limits, and other important information.
- Optional: Set up your online account. Download your new app and make sure it is easy to use.
- Save your new company phone number in your phone book.
- Print your new insurance I.D. card and store it in a designated place in your glovebox. Download a digital copy to your phone.
- End your old plan as soon as you have proof of insurance.
This last step is important for two reasons: first, you must avoid gaps in coverage. Gaps leave you vulnerable to losing your license and leave you 100% liable for any accidents during the gaps. But even if nothing bad happens, insurance companies may raise rates if they see coverage gaps in your history.
Second, if you are canceling in the middle of your policy, you are entitled to a refund of your premium. The earlier you can cancel, the more of a refund you will receive.
Bear in mind that your insurance company may require you send a letter in order to cancel your policy. Set a reminder to follow up with your old insurance company to ensure you have canceled properly and have received your refund if you’re expecting one.
Step 4: Wrap Up
If you have a lease or loan, make sure you contact the holder of your title. Because most loan providers require that you carry insurance, it is best to keep them up to date with your new insurer. This avoids the risk of repossession or other penalties.
You should also be aware that insurers can drop your coverage within the first 60 days of your new policy. So long as you have been honest in your application, it is unlikely you’ll be dropped. Even so, you may want to set notification alerts for any emails from your new company.
Lastly, schedule your next insurance review or set up notifications with Insurify. Reviewing rates at least twice a year ensures you don’t miss future opportunities to save.
The Bottom Line
Whether you end up with a new insurance company or keeping the old one, peace of mind is easy to achieve in the digital age. For most of us, the chance to save money can make a big difference to our annual bottom line. All the more reason to take a little time to evaluate your current insurance against new providers!
Check out Insurify’s auto insurance quotes comparison tool today.