I started Insurance Blog by Chris™ because I have a passion for insurance. Here at the blog, our job is to educate and inform people about the best insurance for them. Since then, we have grown into national brands with a large team of researchers helping people understand all forms of insurance.

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Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health insu...

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Reviewed by Rachael Brennan
Licensed Insurance Agent Rachael Brennan

UPDATED: Feb 11, 2022

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Here's the Scoop

  • There are many reasons you might need to change your insurance coverage
  • It’s a good idea to review your coverage at every renewal
  • You can change your coverage at any time

Once you’ve completed the process of selecting auto insurance coverage, shopping around to find the best prices, comparing the different car insurance types, and buying a policy, you’re probably glad to be done with thinking about insurance for a while. “Do I need to change my insurance coverage?” is a question for another day.

So when does that day come? Will you need to change your car insurance coverage in the future? When can you change your insurance, and why would you need to? We’ve got answers to all of your questions, so read on to find out.

When you do decide to change your insurance coverage, it’s a great time to shop around for a better price. Enter your ZIP code now to see free car insurance quotes from top companies.

When should I change my insurance plan?

There are a few main reasons you will want to change your insurance plan. They usually come with changes in your lifestyle, driving habits, or needs, such as:

  • You buy or sell a car or you pay off a car loan
  • You add a new driver to your household
  • There’s a significant change in your income
  • There’s a significant change in the assets you have to protect

If you buy or sell a car, you will want to make sure it’s added or removed from the policy. And if it’s an addition, you will want to review the coverage levels you’re currently carrying. As a general rule, the insurance company will add that vehicle with the same coverage as your other vehicles. That may not be enough.

When you buy a new car, you likely have a loan, and as a result, you need to carry full coverage. Not only is it a good idea to protect yourself financially, but it’s also required by your lender. And on the flip side of that, if you pay off a loan, you’re free to remove that coverage if you want.

Adding a driver will definitely mean a look at your coverage, particularly if you have to add a teen driver to your insurance. You will want to strike a balance between the cost of insuring that young driver and the coverage you need to protect yourself if they’re at fault in an accident.

Finally, changes in your income and assets are a good reason to consider changing your coverage. If your income has increased, you’re more at risk of being sued after an accident and you probably drive a more expensive car, and thus need more coverage. The opposite might apply if your income has decreased. And the same rules apply to assets. If you bought a house, you suddenly have a big asset to protect against a lawsuit.

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Can I change my car insurance coverage at any time?

Can I change my insurance plan mid-year, or do I need to wait? What’s the right time to make changes? You can make changes to your insurance plan at any time.

Changes will, of course, affect your car insurance rates. If you increase your coverage, your rates will go up accordingly. And a decrease in coverage will follow a reduction in coverage. Of course, if you add a teen driver, you might see an increase, even if you lower the coverage.

The best way to mitigate an increase in rates is to shop around. A different insurance company might offer a much better deal on the same coverage levels. That’s because every insurance company determines its rates a little differently. At some companies, you might pay less for better coverage than you will for lesser coverage with another company.

When can I change car insurance companies?

So what about changing companies? Can you switch insurance at any time? Like changing your coverage, there are no rules that prevent you from changing car insurance companies at any time.

You should, however, be aware that there may be penalties if you cancel an insurance policy mid-term. Because car insurance companies sell policies on a six-month or 12-month basis, they may charge a cancelation fee if you pull out early. You’re also unlikely to get a refund unless you paid your full term premium in advance.

Even if there is a penalty for canceling mid-term, it may well be worth it if the savings on the new policy is significant.

If you choose to wait until your policy is up for renewal, it can make the transition a bit easier. In fact, whenever you have a renewal coming up, you should take a moment to review your coverage and make sure it’s up to date.

How do I change my insurance plan?

If the question of “how to change my insurance plan” is on your mind, the good news is that it’s simple.

To make changes to an existing policy you can either call the company or log into your account on the website or mobile app. Most changes can be made quickly with one of those options. Your changes will go into effect right away, and so will any rate changes.

If you’re looking to switch to a new plan with a new company, your first step should be to shop around and find the plan that’s right for you. Make sure you have finalized that new coverage before you cancel the old one. You don’t want to have a coverage gap that could result in penalties and fines.

Once you’re sure that new policy is in place, simply contact your current insurance company and ask them to cancel your policy.

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Do I need to change my insurance coverage? The Bottom Line

There are a lot of reasons you might need to change your insurance coverage. It’s a good idea to review your insurance annually or at every renewal to make sure it’s still meeting your needs.

You can change your insurance coverage or switch insurance companies at any time. There’s no need to wait.

Whether you need better coverage or you aren’t happy with your current company, shop around before you change your insurance plan. Enter your ZIP code to see free quotes from the best insurance companies in your area today.