I have always loved cars, but a few months ago I realized that there were a few things that I needed to do. I started evaluating my auto insurance plan, and I realized that it wasn't adequate for what I needed. I began focusing more seriously on choosing better auto insurance, and I spent weeks evaluating different policies. It was pretty time intensive, but I was able to find a great policy that really worked well for what I needed. This blog is here to help you to know how to choose auto insurance so that you can protect your finances.
Sticking with the same auto insurance provider year after year may benefit some people, but others may actually benefit from switching to a provider that offers lower rates or better coverage options. Switching from one provider to another can be fraught with a surprising variety of pitfalls. To avoid potentially expensive mistakes, it's a good idea to know what you shouldn't do when you're switching auto insurance providers.
Mistake #1: Leaving a Gap Between Your Current and New Coverage
Canceling your old auto insurance policy days before your new policy is set to begin can leave you without coverage for you and your vehicles. To avoid this gap, you'll want to have your new policy come into effect on the same day as the expiration of your old policy. If you're cancelling during the middle of your coverage period, you should have your old policy canceled on the same day that your new policy is set to take effect.
On the other hand, you shouldn't forget to cancel your old policy as soon as your new one is in effect. After all, there's no reason to pay for two policies if you're not at risk of a gap in coverage. You'll need to contact your old auto insurance provider and make arrangements to cancel the policy - merely ceasing payment on the account will just land you with a collection on your credit report.
Mistake #2: Not Telling Your Leasing Company or Auto Lender
Auto insurance isn't just mandatory in most states — most financing and leasing companies also require their customers to maintain insurance coverage as a condition of their lease or financing agreement. In many cases, you must notify your financing or leasing company whenever you decide to switch auto insurance providers. Whenever necessary, you should provide those firms with proof of insurance as soon as you're finished making the switch.
Mistake #3: Not Going Over Your New Coverage With a Fine-Tooth Comb
Before making the switch from your old to new auto insurance policy, you'll want to make sure that your new policy is an improvement over what you had before. If your new policy offers the same coverage options as your old policy, it should at least come at a more affordable price. Otherwise, you should be getting better coverage out of your new policy.
It's important to read the fine print and understand what your new policy has to offer before you switch. You can always reach out to your insurance agent if you need any help with your new auto insurance coverage.