There are many reasons that people end up deciding to switch their car insurance coverage from one company to another. One of the most common reasons is so that additional money can be saved on premiums (e.g. a better monthly car insurance rate is offered through another provider). Another reason that people switch has to do with the fact that their insurance provider will not adjust their pricing after making improvements on your credit score.
Common Reasons For People To Consider Switching Car Insurance Companies
When people originally purchase their car insurance, most auto insurers set their rates based upon on credit scores, which could have been low at the time. If you improve your credit and your insurer doesn’t give you a better price after the improvement, switching providers isn’t such a bad idea. Most insurers will make appropriate adjustments if your credit improves, but sometimes they may refuse because they don’t want to lose the extra revenue.
Reason #1: Denied better prices even after working to improve your record
Auto insurance companies also base their clients’ premiums on their driving records. Clients who had several points on their records due to speeding tickets and/or accidents were charged rates higher than were charged those who had clean records. Over the year, these clients have worked very hard to improve their driving, and they have not had any speeding tickets or accidents. These are also people who are very good candidates to have their auto insurance premiums lowered. The same problem cited above can happen here, too; the insurance company may deny their clients this privilege.
Reason #2: Better prices offered through other companies
In the event that nothing extraordinary has happened in a car driver’s life such as a better credit score or improved driving, you may have been browsing the internet and compared your current monthly car insurance cost with that of another company and found that you could be getting a better deal elsewhere. This scenario happens a lot, and it is always recommended to get quotes for free online (which you can do at the top of this website by entering your Zip Code) so that you can see whether you are really getting the best deal.
Reason #3: Problems with the way claims are processed and handled
Some people end up having significant problems with the way that their car insurance claims are handled through their current provider. If this is the case, and you have already discussed your dissatisfaction with them, you may just want to switch your coverage. Having your claims handled in an efficient and manner that you are happy with is key as a customer. If you are paying for insurance, you want to make sure that you are getting your money’s worth in all aspects of coverage, including claims.
How to Switch Car Insurance Companies (Step by Step Guide)
1. Step One: Find out when your current auto insurance policy expires. About a month before the current insurance policy expires is the ideal time for people who would like to switch insurance companies to begin their search for a new provider. So this is the first step; find out when the insurance policy ends, because if the policyholder purchases a new insurance policy before the coverage expires on the first policy, then the money that was paid for the first policy will have been unnecessarily wasted.
2. Step Two: Wait for the auto insurance company to send a renewal notice. This renewal notice will outline the coverage the policyholder currently has, the discounts that the policyholder has had, as well as the opportunity to take advantage of and the current price of the policyholder’s premiums. This will be a convenient guide by which policyholders can compare other auto insurance coverage.
3. Step Three: Find the most coverage for the lowest price. People can do this by asking several different insurance companies for a quote for similar coverage amounts. The insurance company that gives the lowest quote for the greatest amount of coverage will be most helpful in the long run. You can even do a free comparison at the top of this page by typing in your Zip Code and checking the results.
4. Step Four: After receiving quotes from the insurance companies, the driver can check out these companies’ financial solvency by consulting the ratings they received from a rating company such as Standard & Poor’s. The insurance companies with the highest ratings have been deemed to be the least likely to default on their obligations if several people were to file claims all at once.
5. Step Five: Check with J.D. Powers & Associates to find out how the insurance companies’ customers rate their services. People looking for a new auto insurance company will find out how quickly the insurance company processes their claims, how well they resolve any problems their clients have and how long people have to wait to have their automobiles repaired.
6. Step Six: After the insurance company with the lowest quotes and the highest ratings from Standard & Poor’s and J.D. Powers & Associates has been chosen, policyholders can then purchase their new coverage.
7. Step Seven: Cancel the old insurance policy. Sometimes, all that is required to cancel an insurance policy is for policyholders to let the insurance company know they are doing so in a letter. This letter will have to let the insurance company know the reason for the cancellation as well as the date that the policyholder would like it to be cancelled. The insurance company may ask for proof that a new policy has been purchased. Be prepared to present it to them. Otherwise, the old insurance company will have the obligation to report to the state that the insurance policy has been cancelled, and the policyholder will be considered to be uninsured.
8. Step Eight: Make sure that the auto insurance company sends a cancellation notice in the forthcoming weeks. The cancellation notice will state clearly that the policy has been cancelled, coverage terminated, and on what date and time coverage has ended. If this notice does not arrive in the mail, it may have been because the insurance company neglected to cancel the policy, and the policyholder will be billed. Avoid this by giving them a call after a couple of weeks to make sure that the policy is officially cancelled.
Why You May Want to Stick with Your Current Insurance Provider
If there has not been an increase in credit scores or a better driving record, people can still, occasionally, seek to have their insurance premiums lowered. Generally, auto insurance companies allow price changes at the beginning of a new year in order to your keep business. Checking for lower prices is always a good idea, but make sure that you are 100% sure that you will be getting quality coverage with a different company before you switch. For additional information, continue reading about changing car insurance companies.