All you need to know about switching car insurance providers to save money

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Switching car insurance can seem like a time-consuming experience and while it’s certainly not the most enjoyable way to spend your time, it could help you to save money in the long run.

When you’re looking to change car insurance providers, there are a few things you should be aware of in order to make the most out of switching so that you can get the best deal possible for your money.

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Why should I switch car insurance?

There are a number of reasons for switching car insurance. The main and most obvious reason for switching is to simply save money on the cost of your car insurance premiums. If you feel like you’re paying too much money for your car insurance and you believe that you can get a cheaper policy elsewhere, then it might be worth looking into switching providers.

You might also be unhappy with your current provider, for example, if the service you’re receiving isn’t up to your expectations and the way they’ve treated you with a past claim might make you want to change insurance companies.

Changes in your personal circumstances may also result in you switching your car insurance. For example, if you get a new car that has a much smaller engine and will therefore be cheaper to insure, you might want to look for a provider who can offer you cheaper premiums.

Read more: Why staying loyal to your insurer could be costing you more

Benefits of switching car insurance

There are several pros and cons of switching car insurance companies, check out some of the advantages below.

  • You can save money on the cost of your insurance, whether you pay monthly or annually.
  • Another provider could offer you better benefits from their policy.
  • It might be cheaper to add another named driver to your policy if you switch providers.
  • You could get cash back from your purchase if you use a car insurance cashback site.
  • You may get much better customer service with another insurer.

Disadvantages of switching car insurance

Of course, while there are definitely benefits of switching car insurance, there are also a few disadvantages to be aware of too.

  • You might have to pay a cancellation fee if you cancel your policy before it is finished.
  • You might miss out on any loyalty programmes your current provider offers if you switch.
  • You might not like your new provider once you’ve switched and you might want to switch again, which can be costly.

How to switch car insurance

There are several steps you need to take when switching car insurance.

First of all, you need to do your research to see which provider and deal s best suited to you. You’ll also need to inform your current provider that you intend to switch and be wary of any cancellation or transfer fees you might have to pay. If you find a good deal on one of the car insurance comparison sites, your existing provider will probably try to offer you a better deal than that - if they do, that's great! You may want to stay with them, but that's up to you.

Comparing car insurance quotes is so important to ensure that you get the best deal on your policy. It might take a lot of time to research different providers, but it will certainly be worth it if you manage to get a good deal.

When switching car insurance, you’ll have to provide your new insurer with all the relevant documents and details they need to make the switch, including personal details about you and the car, information about your claims history and proof of your no claims bonus if you have it. 

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When is the best time to switch car insurance providers?

Research suggests that the best time to switch car insurance providers is approximately three weeks before your renewal date. While, of course, each provider will differ on how much they cost and when they’re at their cheapest, if you follow the three-week rule, you should be able to get a good deal on your new policy.

Does switching car insurance affect my credit score?

Most car insurers will carry out a soft credit check on you when you apply for a policy with them, but this credit check won’t actually affect your credit score.

Your credit score will only be affected if you default on your monthly payments on your car insurance or other financial aspects of your life. Simply just getting a quote for car insurance won’t affect your credit score.

Learn more: Does your credit score affect car insurance in the UK?

How long does it take to switch car insurance?

The length of time that it takes to switch car insurance depends on numerous factors, including the insurer itself, waiting times and how long before your current policy runs out that you apply for a new one.

It’s a good idea to be aware of when your current policy runs out if you’re wanting to switch to a new one so that you can apply for a new policy in plenty of time in order to get the best deal.

Cancelling car insurance early

Cancelling your car insurance early could result in you having to pay a cancellation fee and you might also find that you don’t get refunded for any payments that you’re still yet to make.

For example, if you have six months left on your current car insurance policy, you might think that you’d get back six months’ worth of premiums. Unfortunately, this doesn’t always happen and while some providers might be happy to offer you a refund, many won’t, so just be aware of this before you cancel early.

Will I lose my no claims bonus if I switch car insurance renewal?

Most of the time, your no claims bonus will be transferred to another car, but if you cancel your current car insurance policy before it expires, you will likely lose out on your no claims bonus.

Each car insurer will likely have different policies and terms and conditions, so just double check before you switch your car insurance provider, otherwise you could end up losing your no claims bonus.

Switching car insurance isn’t quite as inconvenient as it may seem. While it might seem easier to just let your insurance policy auto-renew when it’s due to expire, you could find yourself saving a lot of money on your premiums if you have a look around at other providers to see if they can offer you a cheaper policy.

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