Changing Car Insurance Providers

You might have any number of reasons for changing car insurance providers. Perhaps you are moving out of state, getting rid of your vehicle completely, or are simply displeased with your current insurer. Whatever your reason for switching, you can make the transition a smooth and seamless one by following these tips when you change car insurers.

• Notify your current provider. Most car insurance companies will allow their customers to cancel a policy at any point during the term by providing written notification indicating the cancellation date. Send a letter to your insurer that clearly states when you would like your car insurance coverage to end. You can also call your insurer and request a cancellation form, which they will send via mail. Remember that an auto policy does not automatically terminate at the end of its term, so it’s up to you to terminate your coverage in advance.
• Avoid cancellation. If you fail to terminate your current coverage and the policy renews, you must pay the car insurance premium or your insurer will cancel the policy. When cancellation occurs, it goes on your credit report and could give you a “high-risk” label as a policyholder that will drive up your

  auto insurance premiums on your future coverage.

• Coordinate your termination and effective starting dates. Lapses in auto insurance coverage are dangerous not only because they leave you unprotected, but also because auto insurers frown upon them. A lapse in coverage, no matter how small, could raise your car insurance premiums in the future. When you’re switching auto insurance companies, make sure that your new coverage takes effect on or before the cancellation date of your previous coverage.
• Obtain proof of your new coverage. Insurers will usually send official proof of car insurance coverage in the mail once you sign up for a policy, but they should also provide you with a temporary document in the interim. Carry proof of your new auto insurance policy with you in your wallet and in your vehicle at all times. Most states require proof of insurance coverage from drivers during traffic stops.
• Inform the department of motor vehicles, if necessary. Some states have laws that require drivers to inform the department of motor vehicles of any changes in auto insurance. The DMV may need a copy of your new insurance card for their records once you switch auto insurance providers. Check with your local motor vehicles department or state insurance department for details.