Can I switch car insurance companies mid-policy?

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When you purchase a car insurance policy, your insurer will write the policy for a term, which is usually defined as six months or a year. Most insured drivers either choose to renew at the end of their term or shop around and switch when their policy expires. In Clearsurance-conducted research, we found that customers who shopped for a new car insurance company and decided to switch saved an average of $390 on their annual car insurance bill. You may be wondering if you can change car insurance companies before your policy is set to end.

The short answer is yes! With enough notice, car insurance companies will generally allow you to cancel your policy at any point. However, switching mid-policy may come with some cost to you, and you could potentially run into problems. Here are some things to watch out for when considering switching insurers.

Ready to switch? Check out our guide on how to switch car insurance and save money.

Cancellation costs

Although some of the nation’s largest car insurance companies don’t charge a fee if you decide to cancel mid-policy (State Farm, Geico, Allstate, Progressive and Farmers), other companies may still impose a cancellation fee. It’s important to talk to your insurance carrier or agent to discuss the potential penalties involved with canceling your policy before it’s set to end.

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Hidden fees/less coverage

There are plenty of car insurance commercials promising you the lowest rates that try to entice you into switching policies. While this may be true — some companies may offer significantly lower prices for the same coverage — some insurers will offer you a cheaper rate, only to drastically reduce your coverage. For example, if you currently have collision and comprehensive coverage in addition to liability, you’d only want to compare rates with a company offering the same full coverage with the same policy limits and deductibles.

Additionally, an insurance company may avoid mentioning hidden fees and other charges. This can make the new policy appear cheaper than your current policy, when in reality the prices may be closer than they first seemed. If you have an agent, it may be helpful to talk with them about your coverage needs to find out if you can modify your current policy to avoid changing insurance companies before your policy expires.

Coverage gaps

If you cancel your insurance before you have a new policy in place, you may leave yourself vulnerable to serious legal and financial problems due to a lapse in coverage. Additionally, if you go too long without insurance coverage, your new insurers may see you as a “risk taker,” which could increase your rates. Be sure to make absolutely certain that your new insurance coverage will start on or before the day you cancel your current policy or it expires.

If you’re shopping for a new car insurance company, it’s important to research the best options before choosing a company. Clearsurance has rankings of the best car insurance companies according to customers, which you can filter by your state or zip code. Once you’ve selected a few companies you’re interested in, you can read reviews on Clearsurance to learn about the experiences other customers have had with that insurer.

The content on this site is offered only as a public service to the web community and does not constitute solicitation or provision of legal advice. This site should not be used as a substitute for obtaining legal advice from an insurance company or an attorney licensed or authorized to practice in your jurisdiction. You should always consult a suitably qualified attorney regarding any specific legal problem or matter. The comments and opinions expressed on this site are of the individual author and may not reflect the opinions of the insurance company or any individual attorney.

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