How to Switch Car Insurance Companies


WRITTEN BY: Julia Matseikovich

UPDATED: SEPTEMBER 24, 2022 | 1 MIN READ

Switching car insurance companies is a lot easier than most people may think it is. Unlike health insurance (which can be a stressful change that requires a lot of review and waiting periods), car insurance companies don’t have to do that.

With enough notice, car insurance companies even have policies that are put in place that are associated with cancellations mid-policy.

Whether you lose coverage, don’t like your current coverage, or simply want to switch between providers, there are multiple ways to do so. 

Switching Car Insurance Companies Key Takeaways

  • How to get the best car insurance rate – shop around, compare quotes, read company reviews, and ask for recommendations from friends and family
  • When to switch between providers – when you find a better offer from a reputable company offering equal or better coverage
  • How to avoid a coverage lapse – communicate with your insurance companies to coordinate a seamless coverage transition.
  • How to ask for a better offer – talk to your current insurance company and give them a chance to offer you a better rate.
  • Understanding what your coverage offers – don’t just sign the paperwork blindly. Read your policy, understand what it offers, and ask questions if you have them.

Most Important Steps To Switch Car Insurance Companies

To get the best coverage at the best rates, it’s important to compare as many quotes as possible. You do not want to switch insurance companies to one that does not meet all of your needs or one that offers the same coverage at a higher cost.

There are many car insurance companies on the market, and they all offer a wide range of policies and associated costs.

Using an unbiased third-party service or agent is the easiest way to compare quotes within your area. Often, using a car insurance company’s website to compare quotes can result in an inaccurate depiction of the market rates and policies since they don’t want to lose clientele to a better offer.

Websites are created to help people search for optimal prices and policies. These websites use an extensive database of updated and accurate prices in specific zip codes, and not only do they compare prices, but they compare benefits and coverage options as well.

Picking the Right Time to Switch Is Important

To avoid costs associated with switching mid-policy, it’s essential to know when to schedule your switch between car insurance companies. If you’re moving, this can be a great time to switch or necessary if you are moving a far distance or between states.

If you are getting a home insurance policy, many companies offer bundling deals between home and car policies that can help you save overall and on your car insurance policy.

Another prime time to switch between insurance providers is if you are getting married. Typically, car insurance policies have special rates for married partners, so you may be able to get a better cost than you currently have. 

Just as there are good times to switch, there are also wrong times to switch that can cost extra money out of your pocket. One example of when not to switch is when you just got into a car accident or have an open claim for a previous accident.

Insurance companies will see this and often give a higher rate than if you were to stay with your previous provider for a few more months until the claim settles.

Additionally, you will have to deal with two insurance companies until the accident or claim closes. Just because you switch policies does not mean any records from your previous policy go away.

Don’t Let Your Coverage Lapse!

Suffering a coverage lapse can result in hefty fines from your car insurance company and legal fees for violating the law.

First, car insurance companies look closely at if you have a lapse in coverage, meaning if you switch insurance companies or did not renew your insurance in time and have a gap of not having insurance between your two providers. This gap can result in a hefty fine from your new provider.

Additionally, it’s illegal in the U.S. to drive without car insurance. If you get pulled over during your lapse in coverage, you will be given a ticket and charged a fine for not having insurance.

To ensure that you aren’t a victim of a coverage lapse, it’s essential to check the end date of your current or former policy and ensure that your new insurance policy starts on the same day your previous one ends.

You can also make the policy overlap for a few days if you want to begin with your new policy immediately. Getting the end date and start date in writing from both insurance providers is important to avoid any costs they may try to put in place.

Check With Your Current Auto Insurance Provider First If You Find a Better Offer

Although insurance companies don’t have to or may not want to negotiate with customers switching plans, many agents may still be willing to keep you as a client and give you an offer.

Although these offers won’t be a reduction in price on the same coverage, they may be able to find you if you qualify for additional discounts, such as safe driving discounts, student and teacher discounts, loyalty discounts, and more.

Another tactic the insurance agent may use is finding a new option that works for you at a discounted price. It may have a small difference in coverage but a more significant difference in price that’s more appealing to you.

Understand Your Coverage Options Before Making a Switch

Looking at the bigger picture when understanding your coverage and before making a switch is essential.

Although a smaller price tag may look appealing, if you’re downgrading your coverage for a cheaper premium, this may turn out more costly in the case of an accident.

Car accidents are always unforeseen, and you should always prepare for the worst and ensure you have coverage that can protect you when these accidents occur, even if you are a safe driver.

Another essential aspect to note is the quality of the insurance company. Do not just compare quotes. Although the quotes are essential, you should also compare the reviews and testimonials of previous clients of the insurance companies you’re looking at.

Customer service is crucial when choosing a new company to switch to, and you want to ensure you are constantly upgrading when switching providers.