Learning All About Insurance Policies
About Me
Learning All About Insurance Policies

My name is Eric Bowman, and if you have questions about insurance, this is the blog you need to read. I was always confused when I had to purchase insurance. I would either end up paying for insurance I didn't need or I wouldn't buy the right policy. I finally decided that I was going to learn all I could about insurance policies so that I would understand exactly what I was buying. Now, I am completely satisfied with my insurance and the coverage is just what I need. I realized that there are others who are probably just as confused as I was, so I am writing this blog to help others get the best insurance for their needs and budget. I hope that my blog gives you the information you need to make the right choices when purchasing insurance.


Learning All About Insurance Policies

3 Things To Do Before Switching Auto Insurance

Anthony Rhodes

As you analyze your monthly bills and look for ways to save, those thousands of car insurance commercials might pop into your head. Unfortunately, switching auto insurance companies is rarely as simple as most television ads make it out to be. Here are three things that you should do before you switch, so that you don't end up spending more than you need to.

1: Learn More About Your Billing Cycle

Because most people sign up for monthly payments for cell phone plans, health insurance, and gym memberships, they usually assume that all of the billing cycles are the same. For example, you might figure that whenever you pay a bill, you are either paying for your past month of service, or paying ahead for the future billing period. Unfortunately, some auto insurance policies have billing cycles that are set up a little differently.

Because your driving record is constantly changing, car insurance companies are perpetually evaluating any accidents that you get into, any tickets you receive, and the age of your vehicles, and then adjusting your policy accordingly. If you get into a wreck or rack up a bunch of traffic tickets, your policy might be subject to additional surcharges, which are added to your plan when it renews. Unlike other memberships, your policy might renew six months at a time.

The thing that most people don't understand is that if their policy renews six months at a time, they might be under contract for six months at a time. If you decide to cancel your coverage before the renewal cycle, you might be subject to fines for early cancellation, depending on your carrier.

In order to avoid these types of problems, learn more about your current billing cycle. Talk with your insurance agent, like one at Shanahan Insurance Agency, about when your policy renews, and the total of the premiums you have already paid.

2: Keep Those Discounts In Mind

Car insurance commercials do a great job advertising super low monthly rates, but unfortunately, some people overlook the discounts that they are already enjoying with their current insurance plan. Here are a few discounts that you could lose if you aren't careful when you switch companies.  

  • Multiple Cars: Most auto insurance companies offer lower rates for insuring more than one car. If you decide to switch the coverage on your car, but leave your spouse's policy with your old carrier, you might not be eligible for this discount with your new insurance company.
  • Multiple Policies: Some insurance companies offer renter's insurance, homeowner's insurance, or even life insurance plans in addition to their standard car insurance coverage. Most insurance companies offer multiple policy discounts for using more than one type of coverage. Before you switch your auto insurance, check to see if the rates for your other policies will increase.

As you shop around for new coverage, remember that your eligibility for discounts can change. Take the time to go through your bill, analyze your savings, and check with new companies about similar discounts.

3: Line Up Another Policy

If you find out that you only have a few days before your current auto insurance policy renews, you might be tempted to cancel it right away without finding other coverage first. Most people figure that they will be fine for a few days without coverage, especially if it has been awhile since their last insurance claim.

Unfortunately, driving without insurance, even for a little while, is a terrible idea. For starters, if you get into an accident without coverage, you might find yourself on your own to foot the bill for the other driver's medical expenses and car repairs. Even if you are lucky enough to avoid frustrating wrecks, getting pulled over for a simple traffic violation without insurance can get expensive. Tickets for driving uninsured can cost upwards of $500, even if it is your first offense.

Before you grab your phone or computer to cancel your current policy, remember that it is important to stay covered at all times. Take your time, find a great new policy, and make sure that it is in effect before you switch insurance carriers. 

By changing insurance companies the right way, you can preserve your coverage, and save money.