Dealing With Car Insurance During COVID-19
Written by The Clearcover Team | 5 minute read
The COVID-19 pandemic has had major implications for everyone’s personal finances, and many of us are unsure how to responsibly trim our budgets right now for our long-term financial safety. In our recent survey, we found that many respondents are looking to car insurance as a good place to cut expenses. And they’re right. But—this is important—not all ways to save on car insurance are created equal. In fact, some will actually cost you money in the long run.
So, to help you figure out which steps to take next, we’ve put together a practical (brief!) guide on reducing car insurance costs during the pandemic.
Before we get to that, though, an important note: if you’re a Clearcover customer who is struggling because of the economic slowdown, contact us here or in the app. These are difficult times, and we have a range of options to help reduce your bill. Please don’t hesitate to talk with us.
Okay, let’s look at what you should and shouldn’t do when cutting car insurance costs.
Do shop around.
Most people pay too much for their policy because they haven’t researched their options in several years. This is a good time to hunt for the best price you can get. Start with an online tool like Gabi or contact your agent to inquire about your options. Both resources should help you compare insurance policies on an apples-to-apples basis (so you keep all the coverages you need while paying the lowest price).
But don’t cancel your car insurance.
We know it might be tempting to cancel your car insurance, especially if you aren’t driving right now. But even a temporary gap in car insurance coverage can make your next policy a lot more expensive. Insurers will see the break in coverage and adjust your new price accordingly—and you may very well pay a higher rate for years to come. Ultimately, it’s just not worth it. There are more effective ways to save.
Do ask your insurance company about adjusting your mileage projections.
Insurance companies don’t usually allow mileage changes in the middle of a policy term, but this is an unprecedented time and some companies are making special exceptions during the pandemic. So if you aren’t commuting to work right now, it’s worth asking your insurer to adjust your policy mileage accordingly.
And do check your policy to make sure it’s up to date with your current needs.
Check to see which coverages you’re paying for—and whether they still make sense for your situation. You’re required to have comprehensive coverage on your brand new, financed car, but maybe you only need liability coverage on the family clunker? It might also be a great time to reconsider Roadside Assistance and other add-ons.
But don’t cancel any coverages without an expert opinion.
Ultimately, your car insurance policy is a safeguard for you, and it’s important to keep vital coverages. So, before you make any adjustments to your policy, talk to your insurer to make sure you understand what’s in your policy and how each coverage protects you. Making a mistake here could be very expensive in the long run.
Do ask your insurance company about deferring payments, if necessary.
If you need some extra time to make a payment on your insurance policy, call your insurer. Clearcover has made special exceptions to serve our customers during this pandemic, and so have many other insurance companies. So it can’t hurt to ask what your options are. Everyone understands that this is a unique time and most companies will try to help. (Again, if you’re a Clearcover customer, please don’t hesitate to contact us here.)
But don’t stop paying premiums without talking with your insurance company.
Communication is key. Stopping payment without a plan might result in driving uninsured, which is against the law and could cost you a lot of money.
Finally, do ask your insurer about pandemic credits.
As part of our ongoing (and evolving!) effort to support our community and help our customers stay insured during this time, Clearcover is working state-by-state to offer credits or other impactful cost-saving options. You can read the full details here.
(Many other insurers have instituted their own credit programs, too, so if you’re not sure whether you’ll be getting any money back, give your insurer a call.)
Remember, while these guidelines are intended to help you make good decisions, they won’t fit every situation. So, if you’re a Clearcover customer, please do get in touch with us for advice specific to your situation. This is a tough time for everyone—but we’re here to help our community.
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