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When to Drop Car Insurance

Written by Todd Clay. Posted in Research Last Updated: 04/20/2011

High rates, bad service, discounts not being applied, and unfulfilled claim contracts all tell you when to drop car insurance.

A Broken Car Insurance Contract

When an insurance companies doesn't live up to their end of the contract, it is time to drop car insurance.

Sometimes it is just easier to stay with an insurance company even when you are not happy. Finding a new company takes time and most people know very little about insurance so trying to make sure that that they have the right coverage for them can be a daunting task.

But when things get bad enough with your current carrier there are just certain times you need to know when to drop car insurance.

Drop Your Insurance When the Rates Get too High

Every six months your insurance premium seems to be creeping higher and higher. While it may only look like a little bit of an increase on this renewal compared to last renewal, how high has it gone up since you first started with this insurance company?

Maybe you have had a couple of tickets also or even an at-fault accident and now your rates have really jumped. If you have had enough of the rate increases, no matter what the cause may be, you can always start shopping around for rates with other insurance companies.

When you do shop around to get new quotes with other agents or right here on our site, make sure you are getting rates for the same coverages that you have right now so that you can see if you are really saving money or not with a new carrier. Also always keep your current coverage in place, just in case you can’t find a better rate. If you do find a new policy, purchase the new less expensive one and cancel your old more expensive one as soon as possible.

Drop Your Insurance When the Service is Bad

There is no excuse for bad service with an insurance company – it doesn’t matter if you are working through an agent or directly with the insurance company. If you are doing business with a company, you expect to be treated with respect and dignity because you are making it possible that they have income. So when the service is not what you expect it to be and is consistently bad no matter how much you complain, it may be time to move to a friendlier insurance company.

Drop Your Insurance over Discounts

Good driver, multi-car, multi policy and good student discounts are just some of the car insurance discounts available out there to decrease your insurance policy. If you are not sure if you have these discounts, talk to your agent.

Now, if your insurance company does not offer any discounts or says that they offer them and fails to provide them for you, this is when to drop car insurance.  Insurance companies are in the business to make money, but if they are doing so at your expense they do not deserve your money.

Drop Your Insurance When They Fail to Deliver

You purchase car insurance for one reason and one reason only, to be covered in the event of an accident. If you have had an accident and your insurance company does not follow through on its end of your mutual binding contract, this is how you know when to drop car insurance. But, don’t drop it until you have fought your insurance company and got your claim paid (if it is a valid claim).  If you need help contact you state’s Insurance Commissioner and file a complaint.

Once the issue has been resolved, find a new insurance company and drop the old one as quick as you can.

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Todd Clay

Todd Clay is a former insurance agent with the largest insurance company in the United States. He earned his Bachelor’s from the University of Texas. He's worked in several fields but has specialized in insurance, financial-related information, and technology. He blogs at Car Insurance Guidebook. Connect with Tood on Google+

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