Switching Car Insurance: A Step-by-Step Guide

Considering switching car insurance companies? Here’s an overview of the process. (iStock)

Getting a new car insurance policy can be a more involved process than you might realize. It takes more than just finding a cheaper quote and switching insurers.

Before making a change to your policy, you should carefully note your current coverage, compare quotes and research auto insurance companies that suit your needs.

Here are a few simple steps to guide you through the steps of switching car insurance policies. You can compare policies and explore your coverage options on Credible.

1. Research your coverage needs

If you’re considering switching auto insurers, your first step is to re-evaluate your coverage needs to see if they’ve changed. That way, you can opt for a new policy that saves you the most money. For example, you might realize you’re able to pay higher deductibles than you could before, in exchange for a lower rate. Or, you might be eligible for insurance discounts that didn't apply to your situation before.

You could also adjust your coverage on an older vehicle by dropping your collision and comprehensive coverage, keeping in mind that these coverage options would be less thorough if you end up in an accident.

2. Change coverage at the right time

If any of the situations below sound like yours, now could be a good time to change your car insurance:

• Milestone moments: Getting married, graduating or moving across the country for a new job? A big life change could prompt you to change your policy.
• Upcoming renewal: If your policy’s renewal date is getting close, it could be a good time to switch to a new company. On the other hand, leaving a policy too long before its renewal could result in penalty fees.
• New car/driver: If you’re adding your teen to your car insurance policy or you purchased a new vehicle, your rates are likely going to change. Some companies offer better student and multi-car discounts than others.

While you can compare coverage options any time, hold off on switching car insurance companies while you have an open claim. The claim could result in higher insurance rates and complicate the claims process, requiring you to stay in contact with your old and new insurance company until the claim is settled.

Visit Credible to explore your auto insurance options.

3. Compare quotes

The only way to be sure you’re actually getting the best rates is to compare car insurance quotes across several insurance carriers. You can compare car insurance quotes by visiting a few auto insurance providers' websites. All you have to do to get personalized rates is enter a few details about yourself and your coverage needs, and you'll get a free quote. 

During this step, it’s also smart to contact your current provider to see if the company is willing to match the quote and offer you a better rate. 

4. Do your research

You should dedicate some time to researching auto insurance companies and the transition process before you make a move. Look into:

• Customer experience: Online reviews can give you an inside look at how a company treats its customers.
• Savings opportunities: You may also want to look into their discounts and rewards, comparing those to your current provider.
• Terms: Investigate your current provider’s cancellation terms. While you can cancel your policy at any time, some providers may charge a fee if you switch providers in the middle of your coverage period.

To make sure you are not overpaying for car insurance, it’s free to check online through Credible’s partners.

5. Make the switch from one carrier to the next

Switching auto insurers should be an easy process. While you should ideally change car insurance companies just before your policy expires, be careful not to let coverage lapse. Doing so could result in higher rates. 

Simply stopping your payments won’t end your coverage, but it could damage your credit. To cancel your old policy, you need to let your insurance agent know that you want to terminate coverage. You can even ask for written confirmation, which can be helpful if you need to dispute a credit entry or charge related to your policy.

You should also log into your online account to make sure no future auto-payments are set to withdraw.

Once you’ve contacted your old carrier to cancel your policy and activated your new coverage, you’re all set. Just switch out your ID cards.

Changing car insurance companies can pay off

Switching car insurance is a simple process that could come with significant savings over time.

Whatever stage of life you’re in, take a few moments to reevaluate your coverage amount and policy type to see if it’s still the best fit. If it’s a good time for a switch, you could benefit from applying for a new policy with lower rates or more comprehensive coverage.

Comparing multiple insurance quotes can potentially save you hundreds of dollars per year. And it’s easy to get a free quote in minutes on Credible.

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