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Switching Your Auto Insurance to a New Car? Here’s What You Need to Know

When You Need to Transfer Your Auto Insurance Coverage

When you buy a new set of wheels, one of the first things you’ll need to do is transfer your auto insurance coverage.

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Here are the key steps to take:

1. Notify your insurance company within 30 days

Let your insurance provider know as soon as possible that you have a new vehicle. Most companies require notice within 30 days to transfer your policy to the new car and avoid any lapse in coverage. Give them details like the make, model, and VIN of your new ride.

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2. Review and update your policy

Meet with your agent or go online to review and revise your auto policy limits and coverages based on your new vehicle. You may need to adjust coverage amounts for the replacement cost of the new car. And if it’s an expensive sports car, you’ll definitely want to bump up your coverage.

3. Consider dropping coverage on your old vehicle

Once you’ve transferred coverage to the new car, you can cancel insurance on your old vehicle if you no longer own it. But if you still have the old car, you can suspend coverage to save on premiums until you sell it.

4. Pay any additional premium

If your new vehicle is more valuable or expensive to insure, your premiums will likely go up. Be prepared to pay any difference in premium for the increased coverage. The additional cost will depend on factors like the make, model, age, and safety ratings of your new car.

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How to Cancel Your Current Auto Insurance Policy

Here are the steps to take:

Call your insurance conpany’s customer service

Call your insurance company’s customer service line and explain that you’ll be canceling your policy because you bought a new car. Ask about the specific cancelation date so there are no gaps in your coverage. Usually, policies end at midnight on the cancelation date.

Double check that your new insurance policy will be effective immediately

The last thing you want is to be driving uninsured, even for a day. Make sure your new insurer has the exact date your current policy ends so they can start your new policy right away.

Once you have your cancelation date, provide written notice to your current insurer that you wish to cancel. Send a letter, email, or fax with your policy number, cancelation date, and reason for canceling.

If you’ve been with the same company for years, they may offer you incentives to stay. But switching insurers when you buy a new car often means big savings. Do some comparison shopping at other companies to make sure you’re getting the best rate.

When your cancelation date arrives, your old policy will officially end. Double check with your new insurance company that your new policy is active – then you’re all set to hit the road in your new ride, fully covered.

READ ALSO: What is Full Coverage Auto Insurance?

Getting Insurance for Your New Vehicle

Congrats on your new set of wheels. Now that you’ve purchased a new vehicle, it’s important to get proper insurance coverage right away. Follow these tips to make switching your auto insurance policy as seamless as possible.

Make sure to cancel your existing policy on your previous vehicle as soon as you sell or trade it in. Most insurers will allow you to cancel a policy at any time, but check with your provider for their specific policy. Canceling right away will ensure you don’t pay for double coverage and will allow a smooth transition to insuring your new vehicle.

Shop around at different insurance companies to find the best rate for your new vehicle. Auto insurance premiums can vary significantly between providers based on factors like the type of vehicle, your age and driving history. Compare quotes from multiple insurers to find an affordable policy that meets your needs.

Updating Your Policy Details and Coverages

Below are some tips on how to update Your policy details and coverage 

1. Update Your Vehicle Information

Log in to your insurance account online or give your agent a call. Provide the details of your new vehicle like the make, model, year, trim level, and VIN. Your rates may increase or decrease depending on the type of car you now have. For example, if you switched from an economy sedan to a high-performance sports car, your premiums will likely go up. Updating this information ensures you have proper coverage for your new wheels.

2. Review and Adjust Your Coverages

While you have your policy open, now is a good time to reevaluate your coverages to make sure you have the right amount. Things like the value of your new car may mean you need higher liability limits or additional comprehensive and collision coverage. Or if your vehicle is older, you may be able to drop some coverages to lower your premiums. Consider how much you can afford for a deductible as well. The higher your deductibles, the lower your rates will be. But make sure you can pay the deductible in case of a claim.

3. Take Advantage of Any Discounts

Don’t forget to check if there are any discounts available for your new vehicle that you can take advantage of. Things like anti-theft devices, safety features, low annual mileage, or bundling with your home insurance may qualify you for lower rates. Ask your insurance company about any potential car-specific discounts you may be eligible for. Applying available discounts is an easy way to save on your premiums.

Updating these details and coverages on your policy and taking advantage of relevant discounts will ensure you have the right protection for your new set of wheels at a price that fits your budget. Let your insurance company know about any changes right away to avoid gaps in coverage or penalties for lapsed insurance.

READ ALSO: How to Divide Debt in Divorce: Credit Cards, Mortgage, Cars and Medical Bills

Tips for Seamlessly Switching Auto Insurance Policies

Here are some tips to make the process as seamless as possible:

1. Notify Your Insurance Company

As soon as you have the details of your new vehicle, call your insurance company to report the change. Provide the make, model, year, trim level, and VIN of the new car. Your premiums may increase or decrease depending on the type of vehicle. It’s best to check as soon as possible so you know what to budget for your new policy.

2. Consider Dropping Comprehensive and Collision

If your new vehicle is older, you may want to consider dropping comprehensive and collision coverage to lower your premiums. These provide coverage for damage to your own vehicle, but for older cars the payout may not exceed the deductible. Check the current market value of your vehicle to determine if keeping these coverages makes financial sense.

3. Review Your Policy Limits

When switching vehicles, double check that your liability limits, medical coverage, and uninsured motorist coverage are still adequate for your needs. You may want to increase them if moving to a larger vehicle. It’s also a good time to add additional coverage like roadside assistance if it’s not part of your current policy.

4. Ask About Discounts

Inquire if any new discounts may apply to your new vehicle like bundling with your homeowner’s policy or safe driver discounts. Some insurance companies also offer discounts for vehicles with certain safety features. Provide details about any anti-theft devices or safety mechanisms in your new car.

5. Consider a Multi-Policy Discount

If you have other policies like home, life or umbrella with a different company, check if they offer a lower rate for bundling multiple vehicles and policies together. You may find significant savings by making the switch to a single provider for all your insurance needs.

Conclusion

Switching auto insurance to a new vehicle requires some legwork, but following these tips will ensure you get the necessary coverage for the best price. With the right policy in place, you can hit the road in your new wheels without worry.

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