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Things to remember...

Getting car insurance can be an involved process. Not only do you have to gather all of your licensing and vehicle information, but you also have to solicit quotes to find the best rates in town.

Once you’ve compared quotes, you’ll have to select the best combination of coverage limits and the best policy.

Then, after you’ve made your final selection, you’ll have to start the application process which can last anywhere from 30 to 60 days.

You’ll have coverage from the moment you apply even though it takes a while to finalize an insurance rate and issue a policy.

Be sure to submit your first payment with your application and ask for a binder so that you’re not going without coverage.

Use our free comparison tool to get started!

If you decide you want to cancel your policy shortly after you apply, here’s what you should know:

Are you legally allowed to cancel an auto contract you’ve applied to enter into?

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Auto insurance is a contract that’s legally binding. If you read through your policy booklet to understand the terms and conditions of the contract, you would find a lot of legalese that’s difficult for the average consumer to understand.

Even so, both parties that enter into the contract must satisfy their duties when an application is submitted.

Some of the rules laid out in a policy are dictated by the consumer rights that are set forth by the state.

One of your consumer rights when you buy auto insurance is that you’ll be able to cancel your policy at your request.

It doesn’t matter if you are approaching your renewal or if you have almost an entire year left on the term, you  have the right to request a cancellation.

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What are some legitimate reasons to cancel your policy early?

It seems like a lot of work to apply for a policy that you’re only going to have for 14 days.

It’s not ideal to cancel your insurance this early, but sometimes there are factors beyond your control and other times failing to do your research costs you money.

Here are a few valid reasons you should cancel early:

  • You sell your vehicle and don’t plan to buy a replacement
  • You give your vehicle away and decide to surrender your driver’s license
  • Your vehicle is totaled in a loss, and you decide not to purchase a new one
  • You move out of state suddenly
  • Your final rate is higher than expected and you buy insurance elsewhere

Is there going to be a fee for canceling insurance within 14 days?

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There may be a fee for canceling your insurance early on in the policy. Some carriers charge these fees to protect themselves from incurring costs to underwriting an application.

Since insurers spend money on manpower and on reports, they need to be sure that the money spent isn’t in vain.

If you are charged a fee, there will be a provision in the policy saying the company processes short-rate cancellations. The fee that’s charged will either be a percentage of the premiums that are still left unpaid or a fixed amount that’s spelled out in the policy.

If you’re canceling your insurance because you found a better rate elsewhere, take a look at the fee you’ll have to pay first. It’s probably not worth the switch to save $50 each term if you’re being charged 10 percent of your $1,000 balance.

If the fee is only $10 and you’re saving $50, then the effort is well spent. Assessing the cost and savings is important.

How do you submit your cancellation request?

Submitting your cancellation request isn’t difficult if you request the current date or a date in the future. All you’ll have to do is write up a letter saying that you want to terminate the policy effective a certain date.

Be sure to include the following:

  • Your name
  • The date
  • The policy number
  • Your contact information
  • Your signature

Turn the request in at least five days before any automatic payments are coming out of your account.

Why You Shouldn’t Buy Short-term Insurance

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You could apply for a short-term policy that lasts one to 30 days, but it’s not in your best interest. These policies have extremely high premiums because they aren’t underwritten.

They are designed for people trying to get their license back because they don’t qualify for standard coverage.

Look for an insurance policy that you’ll want to keep for the entire term. If something comes up or you’re not happy with the carrier, you can cancel your policy. Start getting quotes through carriers online, and see which carrier has the best rates for you.

Use our quick and easy comparison tool today to get started.

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Things to remember...
  • Auto-renewal is offered by many auto insurance companies
  • It is a way to get coverage immediately and to stay covered without having to remember to pay
  • Make sure you know the renewal dates to avoid misunderstandings or a lapse in policies

When shopping for auto insurance, some people wonder about auto-renewal. In fact, this issue is not unique to the insurance industry.

Auto-renewals are a problem for many different types of businesses.

Consumers sometimes forget that they took out an auto-renewal; then they complain that the company deducted the funds illegally.

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Auto-Renewal Issues
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Some of the problems with auto-renewals include:

  • Forgetting about your agreement – One problem that can occur with an auto-renewal is that you may forget you signed up for it. If you do not keep careful records of when expenses will be deducted, you may find yourself lacking in funds due to the unexpected withdrawal, which causes some customers to be upset with the insurance company and to cancel their policies.
  • Failing to have sufficient funds to cover the withdrawal – Another problem that occurs with automatic renewal is that the amount may be substantial if you renew annually, creating a significant headache for consumers who had forgotten when it was supposed to renew. Again, keeping careful records of when expenses come out is important.
  • Duplicate coverage – When someone drops a previous coverage and then starts a new policy but fails to inform the former insurance company, they may not know you want to cancel in time to keep the auto-renewal from taking place. Thus, in some cases, duplicate coverage can result.
  • Failure to have claims paid due to lapse – If you are caught between a lapsed period due to having insufficient funds, you will not be covered during this period. If you have an accident during the time you were uncovered, the insurance will not pay your claim.

According to confused.com, complaints are often recorded with insurance providers that deal with disgruntled customers who are unhappy with the way an insurer handled an auto-renewal.

But keep in mind that, once you agree to an auto-renewal — whether in real life or online — you have a financial and legal responsibility to fulfill on your end.

Advantages and Discounts for Auto-Renewal
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Also remember that insurance companies often provide a discount to consumers who agree to allow their payments to renew automatically. You can sometimes save hundreds of dollars by agreeing to this with certain companies online. But you have to remember when the deduction is set to occur and remind yourself so that the funds will be available.

Regardless of the number of consumer complaints that are fielded weekly among insurance providers concerning auto-renewal, there is nothing illegal about it. Like any agreement, you must abide by the contract that you signed.

It’s a Contract

With digital online services so prevalent today, it is sometimes easy to forget that you are signing a legally binding contract when you agree to purchase insurance or to sign an auto-renewal agreement.

Even though it is not done in a traditional manner with pen and paper, your digital signature carries just as much legal and financial jurisdiction as if you signed it with pen and paper. So there is nothing illegal about this process.

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When It Would Be Illegal

There are only one or two situations in which an auto-renewal would be considered illegal — that is if you did not agree to have the funds deducted at a particular time each month/annually and the company did it anyway.

This instance is often referred to as “slamming,” wherein a salesperson sells you a policy without your permission, assumes a sale you did not agree to, or otherwise thwarts the legal process that you are entitled to through the FTC (Federal Trade Commission).

Another case that might be consider illegal on the part of an insurance company is when they failed to honor your policy or your claim when you paid the premium through auto-renewal.

As long as the funds were available at the time of renewal, a company cannot later argue that you did not have the funds when they deducted your premium. Otherwise, they would deny coverage falsely, which is considered fraud.

Insurance Regulations
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The insurance industry has very strict regulations regarding the conduct of insurance agents, and they are not allowed to misuse or abuse their position. If you suspect that you have been a victim of this, you can go to your state insurance website and report the incident. See also the state map link we gave you at the beginning of this article.

Also, you may need legal assistance if you were denied a claim due to an auto-renewal that a company failed to honor.

Remember that most mistakes happen honestly. Most insurance companies realize the importance of honoring claims and policies. They understand the importance of your coverage being intact and will try to work with you should your premium not be paid.

Most consumers also know that they must have the funds available at the time of the deduction and are responsible for making sure the premiums are paid on time.

The best rule of thumb is to communicate both at the beginning of a policy and throughout. Clear communication and understanding of the policy, as well as the payment rules, will avoid unneeded misunderstandings, cancellations, and legal issues.

Remember also that an insurance company cannot just cancel your policy automatically. They must give you a 30-day warning from the time that your payment failed to post to your account until they cancel.

This state law is virtually in every state that requires insurance. Again, check with your state insurance site such as this one for Arizona residents to find out where you stand with the state insurance regulations.

Shop and Compare
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The best line of defense against misunderstandings regarding auto-renewal is to shop around and compare before you buy a policy. Feel free to ask questions of your insurance companies that you are considering and ask them about auto-renewal.

Find out how often it will renew, how much money you may save using this feature, and the exact date of renewal.

Knowing this information at the front end will save you a lot of headaches later on. Most companies do not require auto-renewal to join, but it makes your coverage start more quickly and may also save you money on your policy.

To save the most money that you can on car insurance, compare car insurance rates for FREE!

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Click here to view the interactive map and here to view the data tables.

Things to remember...
  • Ridesharing is a popular way to get around in some cities
  • Many ridesharing companies have their own rules and regulations regarding auto insurance
  • If you are a rideshare driver or are thinking about it, notify your insurance company

Transportation has always been an essential part of life. Throughout history, the modes of transportation have evolved, particularly public transportation.

Today, we have buses, subways, and taxis. And the newest addition to public transportation is ridesharing.

Ridesharing takes advantage of a major tool of the 21st century — the internet. Ridesharing services are provided through three main technologies: GPS, social networks, and smartphones.

By using a ridesharing smartphone app, riders can quickly arrange a one-time shared ride with a nearby driver.

Three companies have already made a significant mark in the world of ridesharing and are considered the best in the industry: Uber, Lyft, and Sidecar (who recently shut down).

There are plenty of perks for those looking to work for any of these rideshare companies.

A student can make some extra cash, or a parent can do the same for the holidays. Or a person may just need the extra income and have the vehicle to do so. Having flexible hours is also a major draw. A rideshare driver could also simply be an extrovert who’s not afraid to talk and enjoys the idea of sharing a ride with strangers.

Ridesharing is an appealing alternative to the age-old cab, but keep in mind that ridesharing is still fairly new and is not available in all cities and states.

If you are interested in trying out ridesharing, you can click here to see an interactive map and here to see a table of the ridesharing options available near you.

Better yet, if you already know that ridesharing is available in your area and also want to make sure you are adequately covered, start comparison shopping for insurance today! Enter your ZIP code above to compare the best auto insurance rates for ridesharing!

Methodology

ridehsaring-serviceConsidering that the following two companies are the largest ridesharing service providers, this study is based on information we collected from Uber and Lyft’s city lists.

Along with other companies wanting to make a name for themselves in this business, it appears that Tesla — the company responsible for the new technology to create auto-piloted cars — has hopped on the bandwagon and has plans to break into the ridesharing market.

There used to be a question of whether ridesharing should be legalized, but thanks to state-level legislative bills most states now allow it, but not all states are onboard as of yet.

Currently, there are no state-wide level bans as Nevada recently overturned its ruling, thanks to Uber.

So far, Alaska, Wyoming, and South Dakota are excluded from the ridesharing services of Uber and Lyft for various reasons:

Though more cities are in favor of ridesharing opportunities, some cities are pushing back. Contention exists on both sides — state law and the ridesharing companies — as to what should or should not be included in ridesharing regulations.

The major cities caught in the crossfire of this debate are:

With a constant discourse concerning the laws and regulations on ridesharing, it is increasingly important that individuals understand the laws regarding auto insurance and rideshare services.

Ridesharing Companies and Their Driver Policies

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Every ridesharing company must have a policy in place for every driver.

There are three possible stages for a rideshare driver during a work shift. These three stages are called Period 1, Period 2, and Period 3:

  • Period 1 – The ridesharing app is open, but the driver has not accepted a request, is not on his/her way to a passenger, and does not have a passenger in his/her car
  • Period 2 – Begins when the driver accepts a request and is on his/her way to pick someone up
  • Period 3 – Begins when his/her passenger(s) get into the car

For every period, there should be insurance coverage to protect the driver and passengers. Uber and Lyft have easily spelled out what an individual would need with regard to auto insurance coverage when considering becoming a rideshare driver.

– Lyft’s Requirements

Lyft has listed four insurance coverages included in their driver policies:

  • Contingent Liability (i.e., coverage only while waiting for a ride request)
  • Contingent Comprehensive and Collision
  • Uninsured/Underinsured Motorist
  • Primary Automobile Liability

The last three coverages are only in effect from the time a driver accepts a ride request until the time the ride has ended in the smartphone app.

– Uber’s Requirements

Uber offers an even more detailed description of which insurance coverage applies to which period. The company broke rideshare insurance into three categories:

#1 – On a Trip

Uber has a $1 million insurance policy that will cover a driver’s liability and what might happen between Point A to Point B. Uber’s insurance policy includes these three coverages:

  • $1 Million Liability – A commercial insurance policy that covers injuries or damages to third parties and their property. It protects the driver financially and takes precedence over any personal auto coverage the rideshare driver might have.
  • $1 Million Uninsured/Underinsured Motorist Injury – If another driver is at fault for a car accident and does not have adequate insurance, those who were bodily injured in the rideshare vehicle will be taken care of.
  • Contingent Collision and Comprehensive – Any physical damage that occurs during a trip is covered and is treated as long as the rideshare driver has personal collision and comprehensive coverage.

#2 – Between a Trip

Uber provides a third party liability plan that meets or exceeds the third party liability insurance requirements of every U.S. state.

The liability covers bodily injury up to $50,000 with a total of $100,000 for the accident and up to $25,000 for property damage. Technically, the coverage ratio would be listed as $50,000/$100,000/$25,000.

#3 – Offline

Since it was already established earlier that insurance is required while on a trip, a rideshare driver must have personal auto insurance and is still required to meet state regulations.

Auto Insurance for Rideshare Drivers

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Every ridesharing driver needs to have auto insurance in place. If you are already driving for a ridesharing company but your insurance company does not know, you need to make your insurance provider aware. Click here to see the second table, which displays auto insurance companies offer Ridesharing insurance in your state!

Otherwise, there may be repercussions:

  • Your insurance provider could choose not to cover you in an accident
  • Your insurance provider could cancel your policy and refuse coverage

It’s better to be dropped from an insurance company for providing honest and accurate information about rideshare services than to keep the information from a company and then get in an accident.

Not informing your insurance company that you are a rideshare driver makes you liable for any accident-related costs.

On the other hand, if your insurance company cancels your policy due to being a ridesharing driver, you are free to find an insurance company that will provide coverage to meet your needs.

Click here to find insurance companies offering ridesharing insurance by state. Take notice, though, that some companies offer policies for only Period 1 and others offer policies from Periods 1 to 3.

A Final Word

If you are a rideshare driver or plan to be one soon, you need to inform your insurance company. That way, you have time to look for a company that will cover you as a ridesharing driver in case your current insurance company refuses to do so.

If your current insurance policy does allow for ridesharing, make sure your existing insurance policy covers the gap. If it doesn’t, find a policy that will work for you as a rideshare driver.

Start comparison shopping today for the best auto insurance rates out there for a rideshare driver. Enter your ZIP code below to get started!

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Things to remember...
  • A policyholder can cancel their auto insurance policy voluntarily at anytime they want to and for any reason
  • You need to be sure to cancel a policy when you already have coverage elsewhere so that you won’t be fined or penalized
  • It’s typical for an auto insurance company to ask for you to submit a cancellation request in writing
  • Your cancellation request should include your policy number, the date, your name, and your signature

Your auto insurance policy is yours to keep or yours to cancel. When you’re insured through a company that’s not providing you the customer service or the claims service that you need and expect, it’s time to start shopping elsewhere.

You should never accept poor service when you’re paying a company for coverage.

It’s common for auto insurance consumers to postpone their mission to find a better insurer until their policy is up for renewal so that the policy can just expire.

If your renewal is quickly approaching, this is a viable option, but it’s not an option when you have months left on the contract. Instead, you’ll have to shop the market and set your policy up for an early cancellation. Let’s discuss what you need to do.

If you are also in need of better auto insurance rates, start comparison shopping by entering your ZIP code above!

Can you cancel your policy before it renews?

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All licensed insurance companies have rules that they must comply with that are set by the state department of insurance.

Even though your paperwork says that your contract doesn’t end until the expiration date, it doesn’t mean that you’re locked into it.

Per the state’s Consumer Bill of Rights, you’re allowed to request that your policy is canceled at any time.

The insurance company can never reject your request to cancel your insurance as long as the date is in the future.

The carrier also can’t make it mandatory that you give the reason why you’re terminating the contract.

Is there a penalty for canceling your auto policy early?

When it’s your primary goal to save money, you better be sure that you check and see if you’ll be charged a cancellation fee before you buy a policy with a new company.

Sometimes, the amount that you save will be eaten up by the fee you’re being charged for an early cancellation.

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What is the typical early cancellation fee?

Any fee that you’re charged a fee to end the policy early it’ll be classified as a short-rate fee.

Instead of getting your pro-rated refund back, you’ll get a lesser amount because the fee will be subtracted from what you’re owed.

Not all companies charge short-rate fees. Those that do will either charge you a fixed fee or a percentage of the premiums that you have yet to pay.

If there’s a balance of $500 due on your contract and the fee is 10 percent of the unearned premiums, this means you’ll be charged a fee of $50 when the cancellation is processed.

Steps to Take Before You Cancel Your Existing Policy

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Don’t just make an emotional decision to cancel your policy after your claim is denied or you’re offered less than you feel you deserve.

If you cancel the policy in haste, you could wind up being fined by the state for failing to carry the insurance that you’re required to carry.

Since you have to have mandatory insurance coverage when you have a vehicle registered in your name, you should have another policy in place before you even start to draft a written cancellation request.

Here are the steps that you should take to avoid running into issues after you cancel your policy:

  • Price the cost of coverage elsewhere
  • Contact your insurer to ask how much it will cost to cancel your policy early
  • Submit your application for coverage with the new carrier if you’ll still save money after the fee
  • Wait until the policy is issued to see what your final premium is
  • Write a cancellation request and submit it to your carrier
  • If you cancel your car, you should wait to cancel your policy until you have officially released your liability

Why can’t you just cancel your policy by phone?

It’d be easy if you could pick up the phone, call the toll-free number on your ID cards, and cancel the coverage by phone. With some carriers, this is a possibility but not with many of them.

It’s pretty standard practice for insurance carriers to require your cancellation request in writing.

It might feel like the requirement is only in place to inconvenience you, but that’s not really the case.

Requiring you to submit a request in writing protects the insurer if you allege that you never canceled the policy and then try to submit a claim.

By keeping your signed request in writing, they can use it during arbitration if it ever gets to that point.

Can you backdate your cancellation to a prior date?

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You’ll have to cancel your insurance as of today’s date or a future date if you don’t have any other coverage.

If you have proof that you bought insurance on the car or you sold the car on a prior date, you may need to provide the declarations page or the bill of sale to backdate your cancellation and get a pro-rated refund.

What do you need to include in the written cancellation request?

Now that you know the steps that you must take to cancel your insurance, the next step you need to take is to write your request.

It shouldn’t take you too long to get it all drafted up and ready to give to your agent.

Here’s what it should include:

  • Policyholder’s name (must be written by policyholder)
  • Policy number
  • VIN of the vehicles on the policy
  • Date that you want the cancellation processed
  • Address to send your refund or future documents
  • Your signature and date of the cancellation request

It’s best to do everything right so that your cancellation is processed immediately.

If you haven’t yet taken the steps to find coverage with a different carrier, now is the time to start. Get online quotes and see just how much switching your insurance will save you in the end.

If you’re looking to save some money by comparing auto insurance rates, start comparison shopping today by entering your ZIP code below!

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Things to remember...
  • An insurance policy term is the time period that the coverage is in effect
  • When you cancel your personal auto insurance policy during the term, it’s called a mid-term cancellation
  • Consumers are allowed to cancel your insurance at any time as laid out in the Consumer Bill of Rights
  • If you do request a mid-policy cancellation, there’s a possibility that you could pay a cancellation fee
Insurance products help to safeguard you against financial loss. You can buy insurance on a number of different things from a building to a business.

While there are several different types of property and casualty insurance that can be purchased by consumers, auto insurance is one of the few policies that you’re required to buy under state law.

Auto insurance is one of those safeguards that’s considered mandatory. That’s why you need to be sure that you have coverage at all times no matter how much it costs to secure and maintain your coverage.

If you’re tired of paying high rates through your current carrier and you want to make a switch, be sure to time everything right.

If you are also looking to switch for better auto insurance rates, start comparison shopping by entering your ZIP code above!

Is car insurance always mandatory?

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Car insurance is a form of Property and Casualty insurance.

A Property and Casualty insurance policy is one that protects against property losses and legal liability that results in either damage to third-party property or injury to others. When you buy a property policy, the insurer is indemnifying you against the loss in exchange for premiums.

Not many types of Property and Casualty insurance are required under state law. In fact, auto insurance is the only type of property insurance that’s legally required by insurance regulators in most states.

If you own a car that must be registered to be driven on public roads, insurance will more than likely be mandatory.

There are, however, a few states with exceptions to the compulsory auto insurance rule.

Are you allowed to cancel your car insurance at any time?

You may have to buy insurance to comply with state law but the state still affords you certain protections.

In every state, there’s a Consumer Bill of Rights in place that protects everyone who buys insurance from predatory practices. This bill lays out rules all insurers must follow.

Companies that don’t follow the rules can be fined or stripped of their license.

All state departments have rules saying that everyone with a license and a vehicle has the right to buy insurance, whether it’s from a standard company or a sub-standard company.

The bill also says that every named insured with authorizations to make changes to their policy will have the right to cancel their insurance at any time during the term.

Do you have to explain why you’re canceling your insurance early?

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Not only do you have the right to cancel your coverage mid-policy, you also have the right to cancel your insurance for any reason.

You don’t have to sell your car during the term, surrender your license, or surrender your tags just to terminate your contract.

You also don’t have to give your insurer an explanation if you don’t want to.

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What is a policy term?

Not everyone knows what it means to cancel auto insurance mid-policy.

When you request a mid-policy termination, it means that you’re requesting the termination of your coverage to take place during the current term.

Some companies call the term a policy period, which will last either 6 months or 12 months.

Your policy term is the period of time between the effective date and the expiration date that your coverage is valid.

Anytime you select a cancellation date between these two dates, it’s called a mid-policy or a mid-term cancellation.

How do you cancel your policy mid-policy?

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Canceling your insurance isn’t difficult. As soon as you have a cancellation date and you’re ready for it to be processed, you can send your insurer a written cancellation request by fax, mail, or email.

Some companies will also accept a verbal cancellation request if the date is in the future, in which you include the following:

  • Date of cancellation
  • Policy number
  • VIN
  • Date of sale (if backdating cancellation)
  • Address to send paperwork and refunds

Considerations to Keep In Mind When You Cancel Mid-Policy

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Don’t cancel your coverage on your vehicle if you don’t have new coverage in place. If you do, you could be fined for having a lapse in coverage.

Be sure to ask if there’s a cancellation fee for terminating your coverage mid-policy.

Cancellation fees are actually common in most states and they can range from a few dollars to more than $100.

If you can find coverage for less, switching companies mid-term might make sense for you.

Calculate your short-rate cancellation fee first to determine how much it will cost you. Then, after you estimate the fee, you can start to compare rates.

Get instant quotes online, see if you’ll save a significant amount of money for making the switch.

Start comparison shopping today by using our FREE online quote tool! Enter your ZIP code below to get started!

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Things to remember...
  • As the policyholder, it is your right to be able to cancel your car insurance at any point and for any reason
  • Your right to cancel your car insurance policy does not depend on how frequently you pay for insurance or on how long you have had your coverage in place
  • If there is part of your premium that you have already paid that has not been used, then you are entitled to a refund for that amount from your current auto insurance provider
  • Remember that you are still required by state law to keep active car insurance coverage if you are driving, which means that you need to have another policy lined up before your current policy ends
  • The best way to cancel your car insurance coverage is to call your insurance provider and inquire about how you need to provide notice of cancellation and stop your billing

If you go through the process of canceling your auto insurance coverage, you will find out that the actual cancellation is the easy part. It does not matter how you pay for your auto insurance in terms of whether you have the right to cancel your coverage.

For many drivers, the top reasons to cancel their current auto insurance coverage is one of the following:

  • They would like to switch to another insurance company because they will get a better rate on their coverage.
  • They would like to switch because they have had a poor customer service or claims settlement experience with their current provider.

Compare rates from top insurers today by entering your zip code in our free tool above.

How to Cancel Your Auto Insurance Coverage

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The most effective way to go about canceling your auto insurance coverage is to make a phone call directly to your car insurance provider.

They will be able to tell you over the phone if they require any written notice in order for you to cancel your coverage. The number for your current provider is on your proof of insurance card.

The most important thing to understand about the process of canceling your car insurance is that it is imperative that you have another provider lined up so that you can avoid any lapse in coverage.

Do not make the mistake of canceling your current coverage too soon because you could end up with a fine if you are caught without the required insurance.

When you check with another provider about signing up for a new auto insurance policy, you will want to be clear about the effective dates of the policy. That means that you will need to know exactly when your new coverage starts.

You definitely do not want to cancel your existing coverage before that date.

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Consequences of Cancelling Your Auto Insurance Before You Have Another Policy Lined Up

It is very difficult to avoid getting caught if you do not carry auto insurance. State departments of insurance purposefully set up procedures for insurance providers to send notice to the state when a driver cancels his or her coverage.

This is so that drivers do not try to get away with driving without insurance on the roads.

When you have a lapse in coverage because you cancel your insurance without setting up another provider, you could be locking yourself into paying a higher price for insurance.

This is because insurance providers want to see that you have an established history of complying with all state insurance laws. Insurance companies report cancellation notices to a central database, which can be accessed during the underwriting process.

You should also remember that many auto insurance companies will not extend you coverage without some form of pre-payment.

Even though you may be able to make monthly payments, you may be required to pay at least a month in advance for your new auto insurance coverage to actually kick in. Without an effective policy in place, you are essentially violating state auto insurance requirements.

Setting Up Another Insurance Provider

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It is easier than ever to get another auto insurance plan set in place before you cancel your existing coverage. You can request quotes from multiple companies in your area by comparison shopping online.

In addition to the prices provided by each insurance company, you also want to check into their reputation so that you know the kind of company you will be doing business with.

If you are going with a new company because you were unhappy with certain aspects of your previous insurance provider, it is always a good idea to ask around among friends and family in your area to see what their experience has been like.

The state department of insurance will also have company information regarding customer complaints and any state law violations.

Canceling Your Car Insurance

It is certainly possible to cancel your auto insurance coverage at any point. To save yourself time and money, you need to wait to cancel your policy until you have another ready to go.

If you cancel your existing insurance policy too soon, you will have a lapse in your auto insurance coverage, which is against the law and could force you to pay more for auto insurance coverage from another provider.

You need to be clear on the start date of your new policy before your existing coverage ends.

Get coverage in place right now. Compare insurance providers side-by-side to see how much you could save.

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Things to remember...
  • After an accident or filing a claim, your auto insurance premium could potentially go up
  • You have the right to cancel your policy at any time
  • In most states, you are required to have minimum amounts of auto insurance

Car insurance can be quite confusing after an accident. However, ensuring that you have the right types and amounts of coverage can protect you if you ever need to file a claim.

Regardless of whether you’ve been in a car accident, you should never cancel your car insurance until you have coverage with a different company. Otherwise, you would be breaking the law.

Make sure you have appropriate coverage. Enter your zip code above to compare multiple quotes at once!

I was in an accident, now what?

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Chances are that one day you will be in a car accident if you haven’t already. It is important for you, your passengers, and any other involved parties to seek medical care immediately if it is necessary, without regards to how it will be paid.

The health and well-being of everyone involved should be the priority.

As soon as possible after the accident, you will need to notify your auto insurance carrier. Be prepared to describe the accident and the circumstances preceding it.

If available, you should also provide your carrier with the name of the responding law enforcement officer and the police report number. Your auto insurance carrier will help you officially file your claims for the accident.

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Types of Insurance Coverage

Your auto insurance policy is like several mini-policies rolled into one. Together they can give you complete coverage so that you are protected no matter what calamity your car might befall. Here are the different coverage types:

– Liability

Liability is the minimum type of insurance that most states legally require their drivers to have. Property liability covers the damages you cause to the property of others while bodily injury liability covers their medical or funeral expenses.

It is important to remember that liability only covers other parties for the damages you cause, it will not cover your losses.

– Uninsured/Underinsured Motorist

Although insurance is a mandatory requirement in almost every corner of the nation, some drivers still ignore this requirement.

If you have uninsured motorist coverage, you are covered if you are hit by someone who has no insurance or if you are a victim of a hit-and-run accident.

Underinsured motorist coverage provides additional payments if the other party’s liability coverage does not pay for all of your damages.

– Medical Payments/Personal Injury Protection

If you have medical payments coverage, also known as med pay or PIP for short, it will pay for your medical expenses, lost wages, and even hired help around the house that is needed due to your own injuries.

You can use this coverage regardless of who was at fault for the accident.

– Collision

Collision is an optional coverage that pays for damages to your vehicle as a result of colliding with something else like a car, tree, or building. With this coverage, you select your deductible and your policy limits.

– Comprehensive

Comprehensive coverage also requires you to choose a deductible and policy limits. However, it differs from collision coverage in that it covers other events such as the following:

  • natural disaster
  • fire, flood
  • theft
  • vandalism
  • hitting an animal

– Gap

If you lease your vehicle, you likely already pay for gap insurance within your lease. If you have a financed vehicle, it is also wise to look into this coverage.

Since cars depreciate quickly, it is likely that you owe more on your loan or lease than your car insurance company would give you if they determined that your car was a total loss after you filed a claim. Gap coverage will pay the difference in the amounts.

Will my car insurance rates go up after I file a claim?

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The answer to this question varies depending on the following:

  • your own driving record
  • claims history
  • the policies of your car insurance company

In general, you can expect your car insurance carrier to raise your rates after a claim if it meets a specific dollar amount and the accident was at least partially your fault.

In most cases, a claim will stay on your driving record for three years.

Each auto insurance company has their own limits and requirements for raising your rates, so a claim for one driver that will not raise his rates may be a claim that causes rates to go up with another insurance carrier.

Can you cancel car insurance after an accident?

As the consumer, you have the right to cancel your car insurance at any time and for any reason. Some people cancel because they have found a cheaper policy while others cancel because they no longer own their vehicle.

However, most require you to give written notice within a set timeframe. You should check with your auto insurance carrier on their specific requirements and policies.

In most states, you are legally required to carry car insurance at all times.

When you get quotes from other companies, you will be asked about your accident and claim history.

If you think your accident was recent enough that it may not show up on your driving record, keep in mind that you are required, to tell the truth on an auto policy application.

Sooner or later the carrier could find out about your recent infraction and either raise your rates or drop you as a customer altogether.

Ways to Decrease Your Auto Insurance Policy

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Even if you have a rate increase in your premium after your accident or claims, there are steps to take to try to offset the increased cost such as:

  • Ask about Discounts – Most, if not all, car insurance companies have multiple discounts that drivers can qualify for. This includes multi-car, multi-policy, good student, safe driver, and military.
  • Consider Increasing Deductibles – In most cases, if you increase your deductible, your rate will go down. If you decide to take this step be sure you can pay the deductible if you ever need to file a claim.
  • Reduce Coverage Types and Amounts – You can also examine your auto policy to see if you can lower some of your coverage limits or even drop certain coverages you do not need. Doing so will likely drop the price of your policy.

Instead of canceling your policy to avoid rate increases after a car accident, shop around and see if you can find better rates. Using a car insurance price comparison tool can help ensure you are paying the best prices available. Get started with our free tool today!

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Things to remember...
  • Canceling your car insurance policy is as simple as notifying your insurer that you no longer want coverage through that particular company
  • You can call or go in person to your Progressive insurance agent’s office to let them know that you want to cancel your insurance policy
  • You can also call the main number for Progressive, 866-416-2003, and inform them that you want to start the cancellation processineIf you have an online account with Progressive, you can log in with your policy number and driver’s license number to cancel your insurance coverage onl

Canceling your Progressive insurance policy is a very straightforward process as long as you have your policy information. There are a variety of options to cancel your policy. A major concern to be aware of is that you will need to have insurance through another provider if you are going to continue to drive.

Canceling your insurance without maintaining the legal coverage could land you in a lot of trouble and with some expensive fines.

To find coverage before you cancel your car insurance, enter your zip code above!

Ways to Cancel Your Auto Insurance Policy

adobestock_49125004-1600x1600-1Progressive is just like most other car insurance companies when it comes to being able to cancel your car insurance policy in a variety of ways. If you are not able to cancel your Progressive policy by going to the office in person, then you can pick up the phone to make a quick call. Otherwise, you are able to do so online.

If you have your car insurance policy number and driver’s license number, then you are already well on your way to being able to cancel your policy online. You can find this information on one of your premium bills, your actual insurance policy or your car insurance card.

If you do not have access to that information, then calling your agent or the Progressive company number is the easiest way to go about your cancellation. They will be able to look up your account with some basic information, such as your name, date of birth and Social Security Number.

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Before You Cancel Any Car Insurance Policies

The major reasons that you might need to cancel your car insurance coverage include that you are going to donate your car, you no longer plan to drive, your car is being rebuilt and will not be on the roads or you are getting rid of your car altogether.

If any of these scenarios apply to you, then you should cancel coverage for your car so that you are not paying for insurance that you do not need any longer.

On the other hand, if you are simply canceling your coverage because you want to go to another insurance company, then there are some important considerations for you before you ultimately cancel your policy.

The most important one is that you need your car insurance to be active in order to be legally covered to drive. You will have a lapse in your coverage if you cancel before another policy is in place, so the timing of the cancellation is very important.

Also, make sure to ask for a refund of any amounts of your premium that have not yet been used.

This should not be a problem to get, but you should ask for it just in case. You do not have to wait around until your insurance expires in order to cancel it, but you will want to make sure that you get your money back if there is any left for your policy.

In addition, make sure that the new insurance company takes care of notifying the state that you have the required coverage again for car insurance. There is no need to get any expensive fines because this step was not taken care of in time.

Switching Your Car Insurance

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If you decide to switch your car insurance from Progressive, make sure that you are looking at more than just the price of the new policy when you switch.

The company also needs to be licensed to provide adequate coverage for drivers in your state and should have a positive record for taking care of customers’ claims.

Getting a low price is definitely important, but it should not be the sole reason that you switch car insurance companies.

Do not sacrifice the amount of the coverage you need and the quality of customer service from your insurance company just for a bottom barrel price on insurance.

Recap on What You Need to Know About Canceling Your Progressive Insurance Policy

You can cancel your current Progressive insurance policy a bunch of different ways. Making the call or going online to cancel your insurance policy is the easy part.

The step that takes a little more thought is how you are going to pick up the insurance you need if you still have a reason to be driving.

Also, even though the process of switching auto insurance companies is easy, you need to give careful thought as to the quality of coverage you are getting and the track record of the new insurance company in processing and settling claims. Most times with car insurance, you ultimately get what you pay for.

Enter your zip code below to compare car insurance rates from multiple companies at once!

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Here's what you need to know...
  • Check your online insurance account or call your current agent to see if you still have valid car insurance
  • Look for your most current insurance cards in your purse, wallet and glove box
  • If you are borrowing a car, as the owner of the car if it is insured
  • If you do not own a car, you can purchase non-owners car insurance by using a comparison tool
  • If you do own a vehicle, use a comparison tool to purchase a new standard policy
If you can’t remember the last time you paid your car insurance bill or received a notification from your car insurance company, you may be wondering if your car insurance is still valid.

To check, you can call your current insurance agent or view your online account.

If you can’t remember the details for your online account or the name of your agent, you can always look for your last insurance statement or check your bank account for recent car insurance drafts.

If you find a cancellation letter or a letter indicating that your car insurance expired, you can quickly purchase a new policy by using an insurance comparison tool.

Insurance is required in order to drive legally. If you do not know if your car insurance is valid or current, you should not drive a car until you find out.

Driving without insurance can result in stiff penalties and fines. If you get pulled over by police for driving without insurance, your car could be impounded.

Use our FREE comparison tool above to find car insurance that fits your budget!

Find Out if You Have Car Insurance Before You Drive

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It is absolutely imperative that you find out if you have car insurance before you get behind the steering wheel of a vehicle.

Thankfully, there are several ways to find out in you have a valid insurance policy:

  • Sort Through the Papers  If you are like most drivers, you received your new policy cards and stashed one in your glove box along with your car’s registration and put the other card in your purse or wallet. Open your glove box and sort through your papers. If you don’t find your insurance card in your glove box, check your wallet or purse
  • Contact Your Insurance Company You can call the insurance company you’ve most recently done business with and ask them to verify that you have existing coverage. They will most likely need you driver’s license number and address. Once you’ve given them the necessary information, they should be able to tell you whether you have a valid policy
  • Get a CLUE Report – CLUE stands for Comprehensive Loss Underwriting Exchange. This service is provided for free and various states, like Washington, offer information and advice about obtaining a CLUE report. If filling out the paperwork for a CLUE report seems daunting, you can request a car insurance quote by using a comparison tool
  • Ask the Owner of the Vehicle If you are borrowing a car from a family member or friend, you can simply ask them if the car is insured and who is considered insured while driving the vehicle. You may even want to ask to look at their insurance cards and insurance policy. If the owner of the car refuses, you can get a non-owner car insurance policy

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Non-Owner Car Insurance

Not owning a car does not exempt you from the responsibility of driving with insurance.

You will need an insurance policy every time you borrow a car in order to drive legally.

For instances such as these, there is non-owner car insurance.

Non-owner car insurance follows the driver instead of the car. To find a non-owner car insurance policy, you can use an insurance comparison tool.

Getting a New Car Insurance Policy

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If you own a vehicle and find out that your car insurance policy lapsed, expired or was canceled, you will need to purchase a new policy as soon as possible.

Thankfully, a comparison tool can help you quickly find and sort through various insurance policies and carriers.

Once you choose the policy that best fits you and your driving habits, you can usually purchase it online.

Regardless of how you determine if you have valid insurance, you cannot drive a vehicle legally without it.

You must either find your valid insurance cards or check with your insurance carrier, local DMV or insurance website for your particular state or purchase a new policy by utilizing an auto insurance comparison tool.

Enter your zip code into our FREE comparison tool below to compare rates from multiple providers!

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Here's what you need to know...
  • Car insurance companies can drop for you for different reasons
  • DUI’s, traffic violations, and high-risk behavior can create this situation
  • Failure to pay premiums is cause for non-renewal or cancellation

Sometimes things are beyond our control. Decisions are made by companies sometimes that affect our lives in a big way, even if we do not feel it was justified.

You may be hit by a driver. You may have a medical emergency, which causes you to make several late payments. Or you may have a new teenage driver who has a lead foot and several tickets to show for it.

Many of these unexpected scenarios could cause your insurance company to cancel your policy.

Start comparison shopping now to make sure you have the right coverage at the right price. Enter your zip code in our FREE tool to get started!

Reasons your car insurance company might drop you

AdobeStock_3404582-1600x1600Why might your car insurance company drop you from your coverage? Here are a few reasons this could happen. Keep in mind that this list is not exclusive, but these are the most common reasons this might happen.

– Failed to pay your premium

Sometimes we get swamped with bills that we can’t pay or get behind on other responsibilities. Sometimes it’s just an oversight on our part. Whatever the reason, if you fail to pay your insurance premium, the company will drop you from your coverage.

They are required to warn you about this before they do it.

If you receive an email or letter stating that your coverage is about to be dropped, you can quickly get reinstated to avoid having the policy canceled.

– Collected too many points on your driving record

Insurance companies base your insurance premiums on the number of points that you accrue on your driving record. These points come from your driving behaviors and include many factors.

– Failed to provide adequate information on your application or false information

Providing false information on an insurance application is a felony and is consider insurance fraud. You should always be honest when you fill out insurance forms, but you are only held responsible for what you know to be true.

You will not be held liable for statements that you did not understand. But insurance companies can still drop you if the information you provided is incomplete, inaccurate, or false.

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Other Reasons for Cancelation

Below are some other reasons your car insurance company might drop your coverage.

For this reason, it is important to always drive responsibly, so that you will avoid some of the situations that can create this problem with your auto insurance.

  • Reckless driving
  • DUI’s
  • Moving traffic violations

This list is not exclusive, but it covers a majority of reasons as to why your insurance company might drop you.

What to Do When Your Car Insurance Provider Drops Your Coverage

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When your car insurance provider drops your coverage, they are required to send you an explanation before terminating your coverage.

By law, they are required to give you a 30-day notice before ending your policy so that you have a chance to find replacement coverage in time.

You can find more consumer information at the above link to learn more about your rights as an insurance consumer.

What Do I Do Next?

When your insurance company drops you, you have a few options. First, you can appeal the decision to the insurance company and try to rectify the problem that caused them to drop you from your policy.

For example, if the reason was due to incomplete information or unpaid premiums, you can often repair this situation by simply paying any back premiums due and paying the first premium in advance.

If the company requires more information or the information you initially provided was inaccurate, simply tell them that you made a mistake and gave them the new information they need.

As long as they believe you are honest, they will likely reinstate you.

If you are starting over with a new company, it is relatively easy to implement a new policy right away. Simply compare and shop the various options and contact the provider of your choice to get a free quote.

You can join an indemnity company. If the decision to drop you was due to recent traffic accidents, DUI’s, or reckless driving, it may be a bit harder to get reinstated.

Some insurance companies simply do not want to take the risk of a high-risk driver. However, you can ask any provider you talk to about joining their indemnity company.

Indemnity Company Options

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Most major car insurance providers have an alternate company that they pull funds from to cover high-risk drivers. You may be considered high risk if you:

Again, this list is not exclusive, but it covers many situations where you might be considered high-risk. So, if you fit into any or all of these categories and that is the reason your previous company dropped you, you could ask if you qualify for the indemnity version.

Keep in mind these policies tend to have different stipulations or maximum benefits and higher in premiums than the basic insurance policies, so read the fine print.

But this cost is understandable because the higher the risk to the insurance company, the more you must pay in premiums.

When shopping for auto insurance, compare and check the finer points of the policies as you shop and ask questions to determine what your coverage entails.

With a little time and research effort on your part, you will be able to replace your current insurance if your provider is threatening to drop you.

Make sure though that you get another car insurance policy in place before the previous provider drops you so that there are no gaps in coverage.

Browse the insurance companies and see which ones fit your needs then contact an agent to learn more about what you can do to protect yourself and your car when your insurance provider gives you a cancellation notice.

Remember, it’s not worth the risk to drive without insurance.

Make sure you have the right coverage at the right costs. Enter your zip code into our FREE comparison tool to get started!

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