Can You Change Your Car Insurance Before the Policy Period Ends?
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If your current insurer or policy isn’t working out, you might be asking, “Can I change my car insurance before the policy period ends?” You may face a cancellation fee, but the rate changes and cost savings might make the switch worthwhile. You might also want to change insurance when moving or adding or subtracting others to your current policy. This guide will help you understand if the switch makes sense and how to change auto insurance providers for the better.
Factors To Consider Before Changing Insurance
Before you change car insurance, it pays to do some math and consider the following factors:
- Cancellation fees: Some insurance companies don’t charge a cancellation fee, but if yours does, it will likely cost you $50 to $100 or 10% to 15% of the remaining premium on your policy.
- Prorated premium: If you need to pay a prorated premium, what does that number look like? For drivers close to the end of their policy period, this number might be relatively small. Some companies might also refund your advance payments if you are switching.
- Policy changes: A new company might offer changes such as a difference in terms, costs, payment plans, or coverage options. Of course, you'll also be assigned a new policy number. Take these changes into account before making a final decision.
- Switching companies: When considering changing car insurance providers, it's smart to do some online research into your options. Some companies might give discounts for payment in full. Some might have more robust options relating to the weather conditions in your area. And some might simply be more affordable.
- Rate changes: Does another company offer significantly better insurance rates? Even if you have to pay a fee for cancellation, it might make financial sense to switch to a less expensive insurance company.
- Cost savings: Any cost savings can make a big difference in your budget. Fortunately, you can use online calculators and comparison sites to help you make a good decision for your financial future. Don't forget to factor in different companies' insurance discounts and incentives.
The Process for Changing Insurance Early
Drivers have a variety of coverage options, which makes it easier to change insurers before the end of a policy period.
- Secure a new policy before cancellation: You don’t want to get stuck without car insurance, especially if you are in an accident or face weather-related damage. Make sure you have secured a new policy and that you have proof of insurance before you cancel your current policy. And don’t forget to officially cancel. If you simply stop making payments, you risk getting reported for a lapse in payment.
- Notify your lender or leasing company: Let your lender or leasing company know that you are switching car insurers and on what date. It will want to know the details of the new company to ensure you have continuous coverage.
- Insurance ID cards: You should receive new insurance ID cards online or in the mail.
Pros and Cons of Changing Insurance
Naturally, there are benefits and disadvantages to changing your auto insurance provider.
The pros:
- Potential rage changes: Just like you can make more money when switching jobs, you can save a lot of money by switching car insurers if the new company offers a better rate.
- Impact on premium discounts: You might also find new premium discounts with a different insurer. You can look for discounts for low mileage, a safe driving record, military service, and more.
- Bundling: Some insurance companies allow you to bundle home and auto insurance, for instance, which can offer both convenience and cost savings.
The cons:
- Paperwork: You will have to complete some paperwork to switch companies. You can get the ball rolling by calling your current insurer, but it will probably ask for the news in writing. While this shouldn’t take too long, it is more work than simply renewing your current policy.
- The unknown: Switching to a new company can take you out of your comfort zone because you can't be sure how it will treat you if you submit a claim. However, researching the insurer's reputation and reading online reviews can help put your mind at ease.
Understanding Your Policy Period and Renewal Processes
If you signed up for automatic renewal, your policy period and its accompanying renewal might breeze by without you noticing. Pay attention to the length of your policy period and what is required for renewal — or non-renewal — so you don't get caught off guard. When you read the fine print and understand what it takes to leave an insurer, it will be that much easier to make a sound decision.
FAQs
Do I need to cancel my car insurance before switching?
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Can I switch insurance companies in the middle of a policy?
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When’s the best time to switch car insurance?
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Does switching car insurance affect credit?
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Make an Informed Decision
EverQuote can help you make a smart decision by offering custom quotes and comparisons, no matter where you live or what kind of car you drive.
If you are still wondering, “Can I change car insurance before my renewal date?”, the answer is a definite yes.