What happens to your current insurance cover when you change jobs or move to a different state? Unless you made the change when the cover expires, you’d have to be ready to talk to your insurer. While the annual concept works well for most of us, making changes a few months into the year and before the expiry of your annual subscription may throw you off balance.
Before talking to your insurance company about the change, learn about the company’s policies. You should also check out their acceptable conditions for the amendment.
Insurance companies accept changes in auto insurance coverage in the following cases:
- Change in marital status – this often reduces the cost of your insurance policy/ the cost of monthly premiums.
- Change in car – if you are buying a new car, then you have to make your insurer aware of your intentions. The cost of your cover goes up or down depending on the make of the new car. Will you stick to or change the original comprehensive or third party insurance cover?
- Change of the main driver – auto insurance companies do not trust young drivers and consider them high-risk drivers. If the new main driver is in this category, or they have a record with many speeding tickets, then, the new cover will be higher. This applies to adding a new driver for the car.
- Change in use – you may have to get ab bigger or a smaller insurance cover.
- Modifications to the car – whether you are getting new alloy wheels or spikes, sprucing the interiors, or improving the performance of the car engine, your insurance cover will go up. This is because the car looks more appealing to thieves and in the case of repairs, the cost will also go up.
- Changing the parking address – parking your car in a high-crime area increases the cost of your insurance cover.
- Moving out of state or town – this may affect your cover in that the car will remain immobile meaning that the cost should go down. On the other hand, if moving with the car, then you may have to get a cover applicable to the new state.
- Adding a new car – does the company offer multi-car policies? If not, how will the taking an insurance cover from a different company (for the new car) affect the old cover? Keep in mind that you may need to divulge details of other car insurance companies you are in business with.
These are some of the valid grounds for changing your car insurance coverage. The process of changing your insurance cover is as follows:
- Establish the grounds for amendment
Even if you know that you need a different insurance cover, you’ll have to make sure that your reasons are acceptable.
- Contact your insurance company
By the time you are changing your insurance cover, you will have put some thought into it. As you do that, keep your insurance company in the loop. By making the company aware, they will help in approving and fast-tracking preparation of the new cover.
As you make the insurance company aware of your intentions, ask how much the change will cost. All insurance companies charge an administration fee. Take note of that amount to know if the charge makes financial sense. In some cases, opting out to seek the services of a different company may be the cheaper option.
Making the insurer aware in advance means that you’ll receive the quotation in time and you’ll make the wise deliberation on the best approach.
- Any alternatives
When the option of changing insurance covers fails to favor you, then, canceling your current cover may be your next best alternative.
Before cancellation, shop around for the best cover for your car. Make sure that the cover has all the important features making it worth your money.
Keeping in mind that your current insurance company will charge for cancellation, can you afford the fee? But, you’ll get refunds for any unused cover.
Important insurance changing tips
- Take time to learn about the new insurance cover, preferably from a known insurance quote website, its upsides, and downsides. If insurance cover change makes financial sense or if it is your only available option go with it.
- Leave no gaps – don’t cancel your old insurance policy before getting the new one. If your old policy expires in the course of the change, let the insurance company write a letter or a note explaining your situation. For some weird reasons, we only get pulled over when we have an issue with insurance – it just happens, bizarre, right? To avoid landing in trouble, get things in order before the switch.
- Cancellation of the old policy – Make sure that there is a written confirmation of the cancellation. Cancellation discontinues billing and protects your credit.
If you can avoid additional charges and penalties, do so. For example, if you can wait until your current cover expires, then do so.