When can you switch auto insurance companies?

You can switch your auto insurance company at any time. Always arrange your new policy ahead of time to avoid the penalties associated with gaps in coverage.

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Mathew B. Sims is Editor-in-Chief and has authored, edited, and contributed to several books. He has been working in the insurance industry ensuring content is accurate for consumers who are searching for the best policies and rates. He has also been featured on sites like UpJourney.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com and Safeco. He reviews content, ensuring that ex...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Jul 18, 2021

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Things to Remember...

  • You can switch car insurance providers at any time
  • Canceling before the end of your policy may result in fees
  • You should always start your new policy before canceling your old policy
  • Affordable insurance plans can be found by using a comparison tool

When it comes to switching car insurance, you can technically switch at any time. However, switching before the end of your current policy can result in cancellation fees.

Additionally, if you cancel your current insurance policy and wait to purchase a new policy, you could have gaps in your insurance coverage, which would then be reported to the DMV and could result in higher insurance premiums in the future.

Start comparing car insurance rates now by using our FREE quote tool above!

Benefits of Switching Auto Insurance

Switching car insurance companies have the potential to save you money and provide you with better insurance coverage. However, it is important to do your own research.

Car insurance companies are notorious for telling potential customers that they will save anywhere from $400 to almost $600 a year.

It is important to understand that car insurance policies are typically six months in duration. This means that you will only save a maximum of $200 to $300 every six months. That translates to a monthly savings of between $33 and $50 per month.

When many insurance companies report potential savings, they are not including customers that didn’t save any money, they are actually only reporting what new customers self-reported when they filled out the questionnaire.

In order to ensure you save money on your car insurance, you need to fully understand what your current insurance policy covers and the amount you pay each month.

When you use a comparison tool to find a different policy, don’t just look at the price. Make sure you also view the coverage limits and potential deductibles along with any exclusions.

  • Save money on your car insurance premium
  • Better insurance coverage
  • Better deductible

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How to Switch Auto Insurance Companies

When you first started driving, there is a good chance that you asked your parents which car insurance company they used, and you went and got a policy with them because it was simple and familiar, and you’ve probably never bothered to look at the rates or policies of any other insurance companies.

If this scenario sounds familiar to you, you may be paying too much for your car insurance policy, and you want to switch companies.

In order to ensure that you are continuously covered, there are certain steps you must take when switching insurance carriers. First, you need to locate a new policy with a new insurance carrier. This can quickly and easily be accomplished by using a car insurance comparison tool.

Call your current insurance carrier and determine when your policy ends. If it ends soon, you may just want to wait until the end of your current policy to switch carriers.

If you are still several months away from the end of your policy, ask if there are any cancellation fees associated with terminating your policy early. If there are, you will have to determine if the fees are worth switching right now.

Make sure your new policy is comparable to your old policy because you do not want to find out after a car accident that your new policy leaves you financially vulnerable or not protected at all.

A good way to research your new insurance carrier is by investigating its BBB rating and reading all the complaints. If everything seems legitimate and you are ready to switch companies, purchase your new policy.

It is important to purchase and ensure your new policy is active before canceling your old policy. Having a gap in insurance coverage can negatively affect you.

Call or write your old insurance company and cancel your policy. Let them know that you are going with a different insurance company and have a new policy on your car. You cannot simply stop paying your old premium.

If you stop paying your premium without notifying your insurance company, they could report you for non-payment to the credit bureaus.

  • Find a new car insurance policy using a comparison tool
  • Check with your current insurance carrier to see if there are any fees associated with canceling your policy early
  • Purchase your new policy and ensure it is active
  • Cancel your old policy

Prevent Coverage Gaps

When switching car insurance carriers, it is important to make sure you do not inadvertently create coverage gaps. In order to drive legally, your car must be insured, and gaps in coverage must be reported to the DMV. This can result in the suspension of your car’s registration and even your driver’s license.

Car insurance gaps can happen for a variety of reasons, including you cancel your current policy before activating a new policy or you didn’t pay your premium.

Unfortunately, it doesn’t matter why your insurance lapsed. The consequences are always the same and could include being categorized as a high-risk driver.

If you let your insurance policy lapse and are determined to be a high-risk driver, you could face incredibly high premiums in the future.

To avoid coverage gaps when switching car insurance, make sure to search for a new policy using a comparison tool and purchase that policy prior to canceling your current car insurance.

You can switch insurance providers at any time. However, if you switch before the end of your current policy, you may incur cancellation fees.

In order to prevent any gaps in your car insurance, you should purchase your new policy and ensure that it is active before canceling your old policy.

To find a new policy that provides better coverage at a lower rate, use a comparison tool. Start comparing auto insurance quotes now by entering your zip code in our FREE quote tool below!

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Enter your ZIP code below to view companies that have cheap auto insurance rates.

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