People often ask questions like can you change car insurance mid policy? Are you stuck with your policy until renewal? What happens if you want to add someone onto your policy or change the car? Policyholders may need to make changes to their policies due to changes in their life. When this happen you usually have two ways of affecting the changes on your auto insurance coverage. The first one is to make changes to your existing policy and keep it until at least the renewal. And the second option is to switch to an insurer that can offer you a better deal under your new circumstances.
Making Changes to Existing Auto Insurance Mid-Term
You can make changes to nearly all vehicle insurance policies to suit your needs. You can add drivers, remove an existing driver from the policy, switch the insured vehicles, change your address and so on. Each time there could be either additional premium to be paid or a refund to be made. You pay the required extra premium and carry on with your policy. Here you can find out how much does adding a driver to insurance cost?
There is no need to cancel an existing coverage and buy another policy, either with the current insurer or another company, if you don’t want to. However, it may be wise to switch vehicle insurers if the current carrier demands unreasonably high additional premium and you can find better policies at cheaper prices elsewhere. This could be the case when a family minivan is replaced with a sports car or a teen driver is added to a policy. These are high risk changes and some companies may not like them. That is why you may need to look for insurers that can offer better quotes.
When you feel that auto insurance premium increase is unreasonable whether it is at renewal or when you want to make an adjustment to your policy you should get a few quotes and compare. You don’t need to be with any company you don’t want to be with. They would certainly have their reasons why they offered you higher premiums this time. But that shouldn’t be your concern, especially if you can find a better price for the same coverage.
We will look at various scenarios below to demonstrate the possible options you may have.
1. Adding a Teenager to Car Insurance
Adding a teenage driver to insurance can move you into high risk category with many insurers. And the fact is that large number of companies don’t like high risk clients and charge them extortionate rates. According to a 2010 study done for Nationwide, adding a teen driver between the ages of 15 and 19 to insurance increased premiums on average $800 a year. A 2011 study carried out by carinsurance.com found that the rates can go up around $2,000 on average by just adding a young driver to your insurance. This is mainly due to high average car insurance rates for teenagers that can dwarf the rates offered to mature drivers.
Considering the average cost of automobile insurance is $841 in the US, the increase can double or triple your premium. It is hard to stomach such a hike on your premium. That is why it may be in your best interest to get alternative quotes without waiting for renewal. You may be better served by high risk auto insurance companies that are known to offer lower rates for high risk drivers. You can only benefit from checking for the best rates mid-term on your policy. It is great if you get a nice surprise from an alternative insurer. Otherwise, you may not feel as bad about the earlier surprise received from the current provider.
2. Effects of Replacing a Sedan with a Sports Car on Insurance
You may have been enjoying low premiums for a while with a sensible family sedan. You may be in for a big surprise if you just replaced it with a sports car or SUV. It doesn’t have to be a racing car to double or triple your rates. Quite a few sports models can do that to your premium. If this happens you should follow the above tips and compare car insurance quotes from different companies without waiting for renewal. Every company reacts differently to different models of automobiles.
3. Moving to a Big City from a Small Town
There could be several other changes that can inflate your vehicle insurance costs beyond your imagination. For example, moving from a sleepy little town to a metropolis would do that any time. Then, you know what to do.
Can You Switch Car Insurance Mid Policy?
After the above revelations, you must be asking what happens if I cancel my car insurance? You are hardly ever stuck with a vehicle insurer. Nearly all policies can be cancelled. Then already paid premiums are calculated on a pro-rota basis and returned back to policyholders. In other words, insurers would refund the unused portion of the premium if you paid in full or calculate the premium until the last day you are with them and charge you whatever outstanding. In some cases there could be minimal cancellation fee.
That is why motorists shouldn’t worry about canceling auto insurance policies and concentrate on getting the maximum discounts wherever they can after recent change of circumstances. Here is how to cancel auto insurance mid-term. Many policyholders are known to go for a monthly car insurance payment plan just in case they may need to cancel their policies and switch to another carrier. This makes sense but it isn’t a necessary precaution.
The US policyholders appear to be loyal or to be resisting change. About 40% of policyholders never get alternative quotes. But this may be an extremely costly mistake or oversight as you can save hundreds, if not thousands of dollars. Many of them find various justifications for not shopping around. For example, many people prefer the names they know to new companies because that makes them feel safe. However, this doesn’t make the new insurer worse than the current one. In fact, the cheapest automobile insurance companies are usually the ones with huge brands.