Often people buy and sell automobiles and may wonder what happens with their coverage. For many reasons it may work out cheaper to keep the existing policy. And you may not see any reason for getting a new one although it may not be a bad idea. It may be time to shop around for the cheapest car insurance rates for your new circumstances after a disposal and purchase. Afterall, the subject of the protection has changed.
Unfortunately, your personal details, address and driving history is the main determinant in a premium calculation that it isn’t just possible to hand over a policy with the car. The new owner will have to arrange his/her own one. At this point you have two options. You could either cancel it and get your money back or transfer it to the new automobile you buy.
How to Switch Cars
Once you know you sold the old one and have the details of the new one you could easily contact your auto insurers and inform them of the changes. It is best this is done as soon as possible, although most companies have a grace period. If you already have an insurance policy it may be fine to drive it home and sort out the paperwork first.
Each vehicle is different and they attract different rates. If you had a car that was cheap to insure and the replacement is more expensive you may have to pay the difference in premium. Depending on how long is left until renewal, there may be a little more to pay or you could even get a refund.
If there is a gap between selling and buying you may want to keep the coverage so as not to have a gap in coverage. Companies aren’t usually happy about these gaps. Also, you can actually add another vehicle on your policy temporarily with many companies when you know you are getting rid of the old one.
Do You Have to Keep the Old Policy?
For practical reasons people may prefer to move things over. However, you don’t have to keep your old policy for keepsake. You can cancel it and start fresh for your new ride. Often this may be a better option. A car with totally different specifications can easily double the premium or vice versa. Especially, when you face a serious premium hike, you shouldn’t feel obliged to stick around until the next renewal.
Some carriers can be really funny about certain automobiles. They may be happy to offer cheap auto insurance as long as you have a pretty standard ride. The moment you go for a sporty or a 4×4 type automobile they may not like that and they would let you know this fact by offering you prohibitive rates. It is their way of saying why don’t you find some other company.
Would There be Cancellation Fees
Companies are becoming more forgiving with returns and cancellations these days. Even if there was a fee it would be minimal that wouldn’t affect your decision to stay or go. Also, most people would switch car insurers if they get a decent discount. So, you would be saving money anyway that you would care much about a small cancellation fee.