Changing To A New Car Insurance Policy
Car insurance policies can be terminated for a variety of reasons. If you are moving or relocating to a different state, selling or junking you car, of just want to try a different insurance company, you’ll need to cancel your old policy. It’s important however to follow some guidelines and do it properly.
The “Standard Operating Procedure” for most insurer’s is that you can cancel your policy simply by sending written notice with your desired termination date. Keep in mind that your policy may not necessarily stop at the end of your term, it may have an auto-renew clause. You also shouldn’t assume that your policy gets canceled by simply not paying your next premium.
You also shouldn’t expect this to be clear on your policy. Most insurers will be quick to let you know that your coverage terminates at the end of the policy period if you don’t pay your premium, but they aren’t always so quick to let you know of the repercussions you may face for not providing formal notice of your policy termination.
You should also keep in mind is that your chances of obtaining auto coverage in the future may be impacted is your car insurance policy is canceled. A policy cancellation in your insurance history may end up getting you labeled as a high-risk applicant. Usually though you can avoid this trap by officially terminating your policy properly and in a timely manner.
Switching your coverage to a different insurance company carries additional considerations. Most people who switch plan to drive their car throughout the process. If this is you, be careful not to allow a lapse in your car insurance coverage. Coordinate your new policy’s effective start date on or before the your old policy becomes terminated.
If you go to the trouble and make the effort to notify your old insurance company when you want to cancel your auto policy, and follow their stated termination process, you won’t have to worry about any potential negative repercussions.
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