How To Change Car Insurance Companies

You've outgrown your current insurance provider. You've gotten bad service, found a better rate elsewhere, or are moving to a place your current provider doesn't cover. If this is your first time switching, let the BuyingAdvice team show you, step by step, how to change car insurance companies.

Shop
If you haven't done so already, shop around to find the best rate. Insurance rates can vary wildly, depending on the company's experience with drivers that match your profile.

It should be noted that the best time to shop around is when you get your renewal notice. This will generally give you enough time to make the switch coincide with your current policy's expiration, and help you avoid penalties for cancellation. However, you are allowed to cancel at any time, as long as you give your old company enough notice.
Secure Your New Insurance
Before you cancel your current insurance policy, be sure to have your new policy established. In most states, a gap in your coverage means that you won't be able to drive legally. Most insurance companies now insist proof of your new policy before you can cancel your old one.
Cancel Your Old Policy
Now that your new policy is established, it's time to cancel the old. You'll need to inform your former insurer, in writing, of the cancellation. Depending on your insurance company and state, you might also have to send proof of your new insurance, a copy of your old policy, or even have your new insurer contact them. Within two weeks, you'll receive a cancellation form. Review it carefully, then fill it out and send it back in.

Be sure to follow up and make sure the old policy has been canceled. If your old insurance company doesn't clear the cancellation, for whatever reason, they might think you still want your old policy, and will eventually cancel it for nonpayment. This will put a black mark on your credit report and hurt your ability to obtain insurance in the future.

If you're canceling in the middle of a payment cycle, your previous insurer will owe you for the remainder of your premium, minus any early cancellation fees.