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Knowing When to Switch Car Insurance


Are you thinking about switching car insurance? You’re not alone. Many people opt to change insurance providers for a variety of reasons including a change in policy, a life event such as getting married or moving, or simply to get a better rate. In fact, prudent drivers compare quotes from top providers annually to make sure they have the best coverage at the best cost. 

Whatever your reason, there are a few things to keep in mind when switching car insurance. First, remember that you always need to have insurance when driving your car. So, before you cancel your current policy, make sure you’ve researched, selected, and activated your new policy to avoid a lapse in coverage. Secondly, coverage requirements vary by state, and it’s essential to know your state’s requirements. That way, you’re not underinsured or paying for additional coverage that you don’t want. 

Once you determine the coverage you want, get quotes from the best insurance companies for you to start the process of switching car insurance. 

What happens when you switch car insurance companies?

Fortunately, switching car insurance is relatively easy. The most important part is researching reliable providers to ensure you find the best quote and coverage available. You can compare policies from multiple companies and select the best option for you. 

Here are the most common questions people have about what happens when you switch car insurance companies:

Will I be penalized for switching car insurance companies?

Generally, the rates you pay won’t be negatively impacted for switching insurance providers, even if you do so frequently. A general rule of thumb is to keep your insurance policy for at least 6 months before switching.

Will I be charged cancellation fees?

Although your rates may not be impacted by your switch, some companies may charge a cancellation fee if you cancel mid-policy, so it’s important to check your current provider’s policy before making the switch. In some cases, such as if you already paid for your insurance for the term or your provider charges a cancellation fee, it may make more sense financially to wait until your term is complete before switching.

Does your current policy automatically cancel?

No, your car insurance policy will not automatically cancel when your new policy starts, even if you don’t pay your premium. Once you make the switch, double-check to ensure your previous policy is canceled correctly; it’s best to get written confirmation. You will need to resolve any outstanding claims with your previous provider.


If your current car insurance company lets you cancel for free at any time, then switching car insurance providers is simple. First, start your new policy with a different insurance company. Then let your current provider know you want to cancel your existing insurance. That’s what happens when you switch car insurance companies. 

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Can you switch car insurance at any time?

Yes, you can switch insurance providers whenever you need. How often can you switch car insurance? Generally, as often as you would like. However, it makes the most sense to switch car insurance when you’re experiencing one or more of these events:

  • You want more affordable coverage
  • You need to add, remove, or update your coverage
  • You recently got into a car accident
  • You’re moving to another state
  • You recently got married
  • You’re frustrated with your provider’s customer service
  • You’ve recently purchased a new car

Whether a significant life event or simply because you’re no longer pleased with your provider, you can switch car insurance at any time. However, before you do, it’s important to thoroughly research other insurance companies and get free quotes for the best providers for you. You shouldn’t cancel your current policy until your new one is activated so there’s not a lapse in coverage. 

You can switch car insurance at any time – just make sure to check with your current provider if you will be charged a cancellation fee for switching in the middle of your policy terms. 

When is the best time to switch car insurance?

Figuring out when is the best time to switch car insurance depends on your situation. Typically, the best time to make the switch is when you can get better coverage and rates from another provider. While some people compare quotes from top insurance companies annually, others wait until a major life event to research new providers. 

Switching car insurance before the renewal date

Car insurance policies typically renew annually or semi-annually, during which your policy is reinstated for the next designated amount of time. However, you can switch car insurance before the renewal date. Some companies do not charge a cancellation fee even if you cancel mid-policy. As always, it’s best to ask before making the switch because if your provider does charge a fee, it may make more sense to wait until the end of your term. 

When to cancel your car insurance when switching

Knowing when to cancel car insurance when switching is a bit trickier. It’s important not to have a lapse in coverage. So, before canceling your current policy, make sure your new policy is in full effect. It may even be worth it to wait until you’re billed for your new policy before officially canceling your old one to ensure you have all the required documentation that proves you were not without car insurance. 

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Do you have to switch car insurance when you move?

Do you have to switch car insurance when you move? It depends. If you’re not moving out of state, you likely won’t have to switch your car insurance. If you do move out of state, you’ll most likely need to change car insurance or update your policy. Each state has its own car insurance laws that determine the type and amount of coverage you need. Depending on where you move, your current policy may not have enough insurance for your new state, or your coverage may be more than you now need.

See the requirements in your state to learn more

Sometimes, you have to switch car insurance when you move. But even if you don’t, moving is a good opportunity to reevaluate your car insurance policy to see if you can get better coverage at a better price.

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When should I switch to liability-only car insurance?

There may come a time when having full coverage on your vehicle no longer makes sense. If you’re wondering, “When should I switch to liability only car insurance?” then consider the annual cost of complete coverage on your car. It may not make sense to have full coverage if the annual cost of that coverage exceeds 10% of your car’s value. 

Liability insurance covers bodily injury liability and property damage liability when you’re in an at-fault accident. It does not protect you against uninsured or underinsured drivers when you’re not at fault, and it doesn’t protect you from damage caused by events like a storm or vandalism. Because of this, many drivers opt for full coverage.

Before you decide to switch to liability-only car insurance, there might be a better option: finding a new car insurance provider with rates that don’t exceed 10% of your car’s value.

The #1 thing to do before you switch

You can switch car insurance providers whenever you want. But before you do, you should get quotes from different providers to make sure you find the best rates. Are you ready to make the switch? Request quotes from the top providers and compare rates to find the best policy for you!

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About Rate Retriever

At Rate Retriever, our mission is to make the way you shop for insurance transparent and fair through user-friendly tools that respect your privacy and deliver reliable, comprehensive results 

So we took everything we hated about comparing insurance quotes online – the spam, the long questionnaires, the limited choices, the inaccuracy of quote prices – and threw it out the window, favoring a short form that more accurately estimates what you’ll pay at each of the top insurance providers near you. 

Rate Retriever is an independent company that is not owned by an insurance provider, nor do we provide insurance ourselves. This independence allows us to be your free and impartial insurance research tool, helping you make the best decisions for your insurance needs.  

We may earn a commission when you click one of the links or call one of the providers listed on our site; however, we do not allow our partnerships to influence which information we provide. 

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