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Is it bad to change car insurance companies a lot?

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Things to remember...

  • In order to get the bests deal possible and the best coverage for your needs, you may need to switch insurance companies often
  • Switching car insurance companies does not harm you if you follow the right steps
  • You can locate a new auto insurance policy with the help of a comparison tool

If you are constantly looking for the best deals on car insurance, you may be wondering if switching car insurance every few months harms you.

The good news is that switching car insurance companies to get better rates, better insurance, and better customer service does not hurt you if you do it the right way.

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Reasons to Switch Car Insurance Companies


There are viable reasons to shop for auto insurance and change insurance companies. The number one reason is to save money, but switching car insurance can do more for you than benefit your pocketbook.

  • You Just Moved – If you move locations, especially to a new state, your old auto insurance carrier may not be authorized to sell you insurance in your new state.
  • Your Insurance Company Just Raised Your Rates – whether your rates went up for no reason or you just filed a claim, any time your car insurance company raises your rates is a good time to shop the market for lower rates.
  • Your Last Claim was Denied – A claim denial can cause you to feel financially insecure, especially if you cannot afford to repair or replace your car. Switching insurance companies can help you find a carrier with better customer service that can give you the peace of mind you need.
  • You Will Soon Have a Teen Driver – Adding drivers can cause your rates to increase. When you add a driver, including any teen drivers, you should shop the market to see if a different insurance company will provide you with the additional coverage you need while not causing you a financial hardship.

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How to Switch Car Insurance Companies

Switching car insurance is easy when you know the right steps to take to ensure that you remain covered. The first tip to remember is not to cancel your current policy until you’ve secured your new policy.

  • Find a New Policy – You can use a car insurance comparison tool to locate a new car insurance policy that meets all of your criteria.
  • Read the Results – Once the comparison tool gives you all of your results, you should read through each policy, determine the amounts of coverage, any exclusions, and the price.
  • Choose Your New Policy – After reading the results, go ahead and choose the best policy for yourself and your family’s needs.
  • Purchase Your New Policy – You can purchase your new auto insurance policy directly online and print all of the information.
  • Check to Make Sure Your New Policy Is Active – After you purchase your policy and print all of the information, including your new temporary cards, make sure your policy is active or note the date the policy starts.
  • Cancel Your Old Policy – Once you have determined that your new policy is active, call your old insurance company and cancel your old policy. They may take cancellation requests over the phone, or you may need to provide them with an official cancellation letter.

Hazards of Not Canceling Your Old Policy Correctly


Whatever you do, do not stop paying your old bill until your new policy is active and you’ve officially told your old insurance company that you have a new policy and with to cancel.

If you stop paying your bill without informing your old insurance company, they could report you to the credit bureaus for nonpayment, which could negatively affect your credit score.

If you cancel your old policy before your new policy is active, you could create a lapse in your insurance coverage.

During a lapse, you are not covered by any insurance policy, and if you get into a car accident during that time, you could face dire consequences, including having to pay for all of the accident-related damages and being sued by the other driver.

You could also have your license revoked, have to pay high court costs, and face higher car insurance premiums in the future.

Switching car insurance companies frequently will not harm you if you follow the appropriate steps. To get started, you can use our comparison tool to help you find a more affordable policy with an insurance carrier that you trust to provide you with the coverage you need.

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