Change car insurance policy
When you have done your research and calculated other car insurance rate and compare them to yours. It’s now time to decide and cancel your current car insurance policy. This can be done in various ways. You can contact your car insurance company or agencies via telephone, fax,email or in person. Inform them your intentions of cancelling if they ask and they will issue you car insurance policy termination form, cancellation fee and other related fees which various from companies. You should also note that some auto insurance company may ask you to pay some certain percentage of your car insurance premium and you are also mandated to return the un expired car insurance policy certificate by the issuing auto insurance firm.
However, before you switch car insurance company, it will be a good idea to consider alots of factors. We are going to use a simple mathematically caluculation to illustrate this but I still advise you contact your car insurance agency for your individual case.
Switching Car insurance Policy.
Take for instance you have a car insurance policy with car insurance company named X for $1950 and for this policy to be cancelled or terminated after six months, X insurance company will charge a fee of $130.
After searching online, you found a cheap car insurance company named Y for $1410. Should I switch my car insurance policy from X car insurance company to Y or not?
Suggested Solution to this car insurance case study;
Step 1: Company X cancellation fee is $130
Step 2: We will compute company X six months premium which is $1950 divided by 12 then multiply by 6 which is equal to $975
Step 3: We compute for company Y six moths premium which is $ 1410 divided by 12 multiply by six which is equal to $705.
Step 4: Comparing step 2 and step 3, $705 car insurance policy of company Y is less than that of $975 of company X. $975-$705 = $270
Also, if you company the cancellation fee with the difference in rates, Company Y is better than Company X, so therefore, you should switch.
Note: This calculation does not include personal cost encountered when dealing with the switching car insurance policy like associated telephone cost, taxi fee or cost of diesel encounter etc. These expenses vary from individual and are incurred once so therefore, you should not be bothered. There are other factors or fee that may be consider and it’s worth while to contact your car insurance agent to know more on this.