Switching Insurance? Don't Forget These 2 Important Steps

Drivers need to check these items off their to-do list whenever they buy new coverage.

Changing car insurance companies can sometimes be a financially smart move. Often, it's possible for motorists to drop the price of coverage by shopping around for a new insurer periodically. Motorists may also want to change insurers if they aren't satisfied with the customer service their current company is offering or if they decide to bundle policies.

Regardless of the reasons for switching to a different car insurance policy, there are two steps drivers shouldn't forget when they make this change.

1. Canceling old insurance policies

Cars don't need to be double insured. And when drivers buy new coverage, their old insurer isn't automatically notified. Instead, motorists who have changed car insurers will need to reach out to their old insurance companies directly in order to cancel their policies.

While motorists should make sure their new coverage is in place before ending their existing protection, it's important to act quickly to avoid overlapping policies. Otherwise, they could be forced to pay for auto insurance they weren't actually using because they already had new coverage.

Canceling a policy could also sometimes result in a refund of unused premiums if a driver prepaid for coverage and switches to a new insurer while their policy is still in effect. There's little reason to wait to get back this money from an insurer after making a coverage change, but motorists must cancel their policy in order for it to be returned.

2. Switching out insurance cards in the car

Motorists are expected to have proof of insurance. Most people keep insurance cards in their glove compartment in order to fulfill this requirement.

Of course, the proof of insurance needs to be current. Drivers should make sure to change out their insurance cards as soon as they get new coverage. That way, they can show those cards to law enforcement if they are asked to show they have required minimum protections in place.

Changing out insurance cards could also be important if an accident occurs. Motorists involved in a crash need to have their current insurance information available to them so they can contact their insurer immediately following an accident.

The insurance company may have instructions on where to take the vehicle for repairs in order to streamline the process or may require the motorist to work with a specific rental car company to get fully reimbursed if they have rental car coverage. It could create a lot of hassle for motorists not to have their up-to-date insurance information so they can find out these details after a collision.

Of course, drivers are also expected to exchange insurance information with other drivers in the event of a crash. The other motorists may not be happy if a driver doesn't have accurate and up-to-date insurance details to share when a crash happens.

By changing out old insurance cards in the car and contacting their insurance companies, motorists who switch their car insurance coverage can ensure the process of making this change is a seamless one.