Americans Don’t Want To Switch Car Insurance Companies.
How often do you wake up and think to yourself, “Today would be a great day to switch car insurance companies!” Probably not very often if ever. If it ain’t broke, why fix it? Most Americans get comfortable with something and they prefer not to change. This goes for tv shows, cell phone plans, restaurants, hobbies, and most certainly, car insurance.
If they miss out on a better deal, so be it.
There Has Never Been A Better Time To Switch Car Insurance Companies
Most Americans are not aware of the changes in the way our auto insurance premiums are being calculated. Your current insurance provider may have offered you a great deal in 2021. In 2022, the deal may not be that great. There is a good chance that another company can save you some good money if you shop around regularly and make sure your deal is still the best. If your current insurance provider believes you may switch car insurance companies, they may match the offer or even give you a better deal. Then you will get what you want and you won’t have to change. Isn’t it better to have the money in your pocket than theirs?
The time to make your move is as your renewal period approaches. Here is a step-by-step guide to help you ensure a successful switch.
1. Research
There are two extremes in insurance coverage: too little insurance and too much coverage can both be financially harmful to you. When you think that you are spending too much, it is time for you to consider switching the car insurance policy.
You also need to be aware of the insurance requirements. A 22-year-old college graduate cannot afford high liability coverage. In comparison, a retired individual who has accumulated sizable savings and multiple vehicles should consider using high liability coverage.
Most car insurance companies offer policies for six months or a year. The best time to switch policies or cut the deal is when you are adding another driver to the policy or buying a new car.
Insurance experts suggest researching once you go through a life-changing event such as marriage or the birth of a child. Just because an insurer is offering lower cover car insurance, it does not necessarily mean that the coverage will meet your requirements. There is no point in opting for a cheaper policy if it does not provide you with the benefits that you are looking for.
It is also important to go through all the terms and conditions stated in a policy before purchasing it. You need to understand the coverage and the protection you are eligible for under the new policy. It is also a good idea to discuss the points of the policy with your family members before making a decision. The advice offered by friends and family members is of great help when looking for the right insurance coverage. They help you narrow down the search list as they have already done the legwork and provide you with sound advice regarding the issue.
2. Contact the Current Car Insurance Company
Once you find the right coverage option, it is time for you to contact the current insurer. Surprisingly enough, most car insurance companies are willing to show flexibility once you discuss the offer you receive from their competitor.
Insurance companies value their customers, which is why they will make an effort to retain you by offering better car insurance rates. Insurers leave some wiggle room to show flexibility to the user in times of need. This is why the current rate is often not the best rate that the existing provider is offering you. Therefore, when deciding to switch car insurance companies, it is best to call the current company and see how flexible they can be.
Before leaving the old provider, you also need to consider the rewards you are giving up. Many car insurance companies offer complementary rewards and incentives for drivers who drive carefully. You need to factor in the potential rewards and incentives you will miss out on before deciding to change the insurance company.
Similarly, it would be best if you considered the penalties of leaving the existing insurance provider. Usually, insurance companies charge a cancellation fee of $25-50 or a small percentage of the annual premium. If you leave before the end of the coverage period, the insurance provider will refund the unused part of the deal.
You need to weigh the cost of the cancellation fee with the benefits of leaving the insurance policy early. Upon buying the new insurance policy, you can ask the agent to assist you in canceling the previous plan. You might also want to talk to the bank for canceling the payments to the last insurer if you use electronic funds transfer or auto-pay for the purpose.
3. Clear the Dues of the Car Insurance Company
When finalizing the deal with the previous provider, you need to ensure that you are not subject to any financial charges by them. Contact the old insurer and ensure that you are completely off the hook and tell them that you are ending the policy. Don’t forget to get a written confirmation in this regard because it is better to be safe than to be sorry.
Insurance companies send a report to the credit bureau with your name in it if they still consider you a customer. This can affect the overall credit score hampering your ability to take loans and mortgages. If you notice a change in the credit score because of incorrect information from the car insurance company, show the credit bureaus the official confirmation letter.
Conclusion
Switching car insurance companies can be a tricky exercise because there are a lot of minuscule details that you need to pay attention to. When switching the current insurance provider, you need to ensure that the new provider starts its coverage from the day the old coverage ends.
You need to stay vigilant throughout the process because negligence at any stage can end up costing you.
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