Get Free Car Insurance Quotes >>

Canceling Voluntarily
If you choose to cancel your insurance policy for any reason, then you should be entitled to a full refund of the remaining premium. There will be a deduction from the amount you paid, depending on how long you have been insured. If you have only been insured a short amount of time, then you will get a refund of most of your premium. For example, most premiums cover six months of insurance. If you paid $300 for six months and you cancel after 1month, then you will get approximately $250 as a refund. However, you should read your policy closely. There may be fees associated with early cancellations.

Contact Insurer in Writing
In order to cancel a policy, many insurers will require that you send them written notice. This is to cover them and to cover you in the case of any questions in the future. Most states require a driver to have auto insurance, and if you cancel the insurance and have no coverage, then you will be liable in the case of an accident. In order to cover themselves, the insurance company will want a written statement with your signature showing that you canceled coverage.

If you do cancel coverage, you need to have new insurance in place before you cancel your previous policy. In many states, you will be liable for a penalty and fee for any amount of time that you are not covered. It may take several days or even weeks to receive your policy refund.

Insurance Company Cancellation
There is s difference between you canceling your insurance and the car insurance company canceling your coverage. Insurance companies only take the step of canceling coverage during a term if you violate the terms of the insurance agreement in a some serious way.

One of these ways is non-payment of premium. If this is the violation in your case, then you won't get any money back from the company, clearly. You can avoid cancellation for non-payment by setting up an automatic payment program or by simply paying your premium on time. Many insurance companies offer a grace period for established customers, but are less accommodating to new customers without a track record.

If your policy is canceled for other violations, the circumstances are different. These violations may include a DUI, too many tickets or too many accidents. If a company cancels your insurance due to these kinds of violations, they must send you written notice, and will give you a period of time to search for new coverage, although it may be a short time.

Even under these circumstances, the insurance company will send you a pro-rated refund based on the amount of time left on your policy. Again, this refund will take several weeks to arrive, so don't count on it as the means to pay your new premium.

Even if the insurance company cancels your car insurance, you are generally entitled to a refund of unused premium. The only exception is if your insurance agreement specifically states that there will be no refunds. You can expect this kind of provision if you have high points on your license, a high number of accidents or a poor payment record.

Get Free Car Insurance Quotes >>

How Do You Cancel Your Car Insurance Policy?

As long as you know what you need to do it's not a hassle. Here's what you need to know.

Find Other Insurance First
Before you consider cancelling your current policy you will need to set up a new policy. A lapse in coverage can end up costing you a lot of money in fines from the state, and can make it difficult to find insurance later on. Know what day you want your coverage to start with the new policy before you go any further.

Call Your Current Provider
Once you have a new policy set up you can call your current insurance carrier. Tell them what day the new policy takes effect and you can cancel your existing policy as of that day. If you cancel the policy first then find another insurance carrier you may end up having to pay fines and risk being cancelled by the new company later for having a lapse in coverage.

Waiting on Reimbursement
If you are cancelling a policy that has been paid in full before the term expires, you may get a refund from the insurance company. We stress "may" here. This will depend on the policies set forth by the insurance companies and what state laws are in place regarding paid premiums in your state. Most insurance companies will charge a fee for cancelling early, and this will come out of any paid premiums. This is usually equal to one month's worth of premiums.

Cancelling Car Insurance When Selling a Car

When selling a car in a private transaction, it is important to properly time when you cancel your car insurance. While the car is listed for sale and prospective buyers are test driving it, you must keep your insurance active. In most states it is illegal to have an uninsured vehicle on public roads. Once the terms of a sale have been determined, the timeline and steps are usually as follows:

1. Decide upon a price, and draft a bill of sale.
2. Exchange payment (be sure to receive certified funds) and sign the bill of sale in front of a notary public. Typically your local bank can act as a notary public.
3. Sign over the title to the new buyer and have it notarized as well.
4. Fill out any other additional paperwork that might be required by your DMV.
5. If possible, fill out, sign and notarize a "Release of Liability" form. These can also be found on some DMV websites or available on various document library websites.
6. Cancel your insurance and be sure that the new owner adds the vehicle to their insurance policy.

For additional information, consult your state's DMV website. Typically a detailed step by step list outlining the car selling process will be available with links to applicable forms.

Get Free Car Insurance Quotes >>

When Should You Cancel Your Car Insurance Policy?

You can cancel a car insurance policy whenever you wish. It's not always a good idea though. Here are some examples of when cancelling a car insurance policy is a good thing to do.

Finding Better Rates
If you find a better rate on your insurance and want to switch, then you should cancel your insurance policy. There are a few things here that need to be done though. First make sure the new coverage takes affect before the old policy is cancelled. You need to be covered 24 hours a day. When you find a new policy pay attention to when it starts. In many cases they will tell you the coverage starts at 12:00 midnight on a specific day. You can then take that date and tell your current insurance company this is the last day of coverage needed. Secondly it's best to wait until a policy is about to expire before switching to another insurer. If you cancel a policy part way through the policy period this may result in an early termination fee of some sort.

Before Your Policy Expires
If you are looking to cancel a policy because you don't want to renew it, it's best to let them know several weeks before the policy expires. You will also want to make sure your new coverage picks up right where the other policy ends. Using this buffer of several weeks allows you the peace of mind in knowing that your record will reflect to lapse in coverage.

Coverage Issues
Insurance companies have really gone out of their way to make sure they appear fair and just. There are many smear campaigns out there either by disgruntled policy holders or competition. Unfortunately sometimes you may run in to issues with your coverage. If you have had a bad experience and can't seem to get anything straightened out, or if the outcome wasn't fair in your mind, then it may be a good idea to find another insurance company to carry your auto policy. Bear in mind that you will need to set up the new policy first so you won't have any uninsured periods. You also want to wait until any litigation is settled with the current company if you are in the middle of a claim.

Temporary Holds
If you plan on traveling, or you have lost your job and can't make your premiums then you may be tempted to cancel your policy. In these cases, you can usually place a hold on your policy for up to a year. During this time you will be uninsured, so you cannot drive. But you won't have to worry about explaining a lapse in coverage and won't have to go through the hassle of finding another policy later when you are back from your travels or able to pay for the premiums again.

Get Free Car Insurance Quotes >>

How to Cancel Insurance on an Undrivable Vehicle

Some new drivers may be unsure about how to cancel insurance in a range of situations. If your vehicle is out of commission, paying attention to some basic considerations will help you successfully cancel insurance without liability.

• Don't cancel without resolving claims. If your vehicle is un-drivable as a consequence of a collision, trying to cancel the insurance policy before the claim payout may complicate matters. Call and talk to a representative about how to put premium payments "on hold" or otherwise mitigate the costs while you are resolving the accident claim.
• Make sure state notification is in place. If you are canceling insurance simply because the vehicle broke down, you'll need to communicate that to your insurer. Otherwise, you may run into problems. Some insurers may assume that you are driving the vehicle without insurance, and in some cases, they will notify your state DMV. You may get a written bill or notice in the mail about your vehicle's uninsured status. Inform your insurer upfront to avoid these kinds of situations.
• Ask about prorated premiums. In many cases, your insurer will rebate you for the amount of time that you prepaid when you are canceling insurance before the end of its term.

How to Cancel Car Insurance after 14 Days

Most auto insurance companies let you cancel car insurance within 14 days of taking out the policy. This is commonly known as a "cooling off" period where you get grace to cancel any agreement before you become committed to it. Canceling your policy inside these 14 days imposes no charge, but if you choose to cancel after that time period you might find there are some penalties and barriers.

Check Your Details
Before you begin it is important that you read the entire policy document and find out if any penalties are imposed if you cancel it. They may include a penalty for canceling a car insurance policy within a certain period of time, but most companies will offer you a refund of any period which is unused or paid in advance. Policies vary widely so if you are unsure, call the carrier and ask what their exact policy is regarding cancellations. Other companies will just require written notice and impose no extra charge, but find out for sure about your own.

Call the Carrier
If you are canceling your insurance policy, consider the reasons. Are you unhappy with the service? Did you get an online quote with another company and found that you could get more for your money? Perhaps you called another company or agent and were offered a cheaper quote altogether. Whatever the reason, call your current company and tell them you are thinking of canceling your insurance. If the agent is worth their salt they may try to keep your business by offering you a lower rate, a discount or other benefits and start a mini price war between them and the new carrier.

Time Your Changes
You must not go through a moment without being covered, so make sure you talk to your carrier first and decide whether you can proceed forward with your contract to them or if you are going to change companies. If you decide to change companies, time it so that you change during a period where you will maximize your refund from the original carrier or minimize any penalty.

Write a Letter to Cancel Insurance
Put any cancellation in writing to your current agent or provider. Some states even require you to notify the DMV of any alterations in your insurance arrangements. Follow the correct procedure for your state and inform those necessary. In the letter, clearly state your name, address and policy number so that the company can correctly identify you and cancel your policy as requested.

Determine if Cancellation Is Necessary
There may be occasions when you absolutely need to cancel your policy. The reasons could vary from medical conditions that prevent you driving or having a spell without a vehicle, or even financial difficulties. Whatever the reasons for canceling, you should still observe the advice that has been offered and correctly cancel your policy with your carrier. For opting out of a shared car insurance policy you need to make sure that you do not owe any extra fees, so contact the company that administers the policy and get clear details of your responsibility.

Get Free Car Insurance Quotes >>

How to Get the Unearned Premium on Your Auto Insurance Policy

The unearned premium on an auto insurance policy is the proportion of the down payment for the total agreed term that covers you for the rest of the time left in the term. If you decide to cancel an insurance policy before the end of the agreed term, your insurance provider will owe you the unearned premium. You could want to cancel your insurance policy for any number of reasons, whether you're moving away or because you found a better deal with a different provider. No matter the reason why you want to get out of the policy you now hold, the process of getting back your unpaid premium is fairly simple.

Check for Cancellation Fees
Check your insurance policy to see if there are any cancellation fees. Many insurance providers will make you pay a fee to get out of your policy before the end of the term, and if this fee is higher than your unearned premium, it's not worth canceling.

Tell Your Provider that You Want to Cancel
If you have determined that it is still worth collecting your unearned premium even with the cancellation fee, alert your insurance provider that you want to cancel your policy. You can do this in person or by phone.

Wait for Your Money Back
Once you have told the provider that you want to cancel your policy, your unearned premium should be refunded. Depending on your provider, you will either have to wait for a check to come in the mail or get a direct transfer to your bank account.

Get Free Car Insurance Quotes >>

Related Questions and Answers

Can I Get My Money Back If I Cancel My Insurance Early?

In almost all circumstances, a person should be able to get a refund on their insurance policy if they cancel it. Cancelling for any reason is permitted under most policies, but you should read the through the entire policy to make sure that is the case. Policies often have an early cancellation fee, so check your policy. The refund will be pro-rated for the amount of time you have been insured. If the insurance company cancels your policy for any reason, such as missed payments or fraudulent claims, you will not be eligible for a refund. Insurance companies often require cancellations to be done in writing.

Do You Get a Refund on Car Insurance if You Sell Your Car?

The majority of car insurance policies allow refunds for cancelled policies. After selling the vehicle being insured, simply contact the insurance company and request a refund on the balance of your policy. Insurance companies often require cancellation requests to be in writing. As long as the premiums have been paid on time, the insurance company should issue a refund that is pro-rated for the time remaining on the policy. There are often early cancellation fees, so read the policy in full and ask questions about anything you don't understand. If the insurance company cancels your policy due to non-payment or fraudulent claims, you will not be entitled to a refund.

When You Cancel Car Insurance Do You Tell Them If Your Car Was Repossessed?

Repossession is not a fun activity to get involved in, especially when it is your own car being repossessed, but you should cancel car insurance if your car is repossessed. For the most part, automotive insurance companies do not require that they are informed of a vehicle repossession. Everything depends on what is stated in your automotive insurance policy. Double check your policy prior to canceling your automotive insurance so you do not break any terms of the contract, which could prevent you from getting some money back upon cancellation. If a car insurance company needs notification of a repossession, you should provide it in writing.

Can I Cancel My Car Insuarnce If I Sell My Car?

It is possible to cancel car insurance for a vehicle that you decide to sell. The only catch here is that any lapse in automotive coverage from one car to the next can create a truckload of problems for you in terms of tickets and fines from the state where the car is registered. It is illegal to drive on the roads of the United States without any automotive insurance, no matter the type of policy, but this can be prevented. If you plan on canceling the policy on a car you are selling and opening one up on a new car, make sure the new one is active before the old one is canceled.

Can I Cancel My Car Insurance Policy Without Having Another Policy Ready?

You are able to cancel car insurance policies without having another policy ready, but you might not want to drive the vehicle during that time. You will put your license and financial worth at risk when driving in between insurance policies because if you are caught, you will be subject to thousands of dollars in fines and the possibility of a license suspension. Should you decide to cancel your current automotive policy, make sure you have a replacement policy in place to protect your license status and wallet. Approval and payment in full will need to be secured prior to activating the new policy and canceling the old one.

Can I Cancel My Auto Insurance at Any Time?

For the most part, you are legally allowed to cancel auto insurance policies at any time during the life of the policy. Automotive insurance companies will ask for certain items during the cancellation process. Those items include notice of cancellation, the return of the original policy, and sometimes you will have to sign a policy release. A policy release lets the automotive insurance company know you are no longer on their policy and it helps serve notice to your new policy provider that you are no longer insured by another company. Canceling an automotive insurance policy might come with penalties, which could come in the form of a small fee.

Will I Need an SR-22 If My Current Insurance Cancels My Policy?

SR22 insurance filing forms are required by the Department of Motor Vehicles to reinstate a driver's license after the license has been suspended. You will need an SR-22 form should your current insurance policy be canceled but you will need to purchase the minimum amount of liability insurance first. These forms are issued by automotive insurance companies, only by their licensed representatives or agents. SR-22 forms can be used for driver's who have had their license suspended, been charged with a DUI, reckless driving, hit and run, wet-reckless or driving over 100 MPH. Other reasons for an SR-22 include causing an accident with no liability insurance or being issued too many moving violations by police officers.

How Long Is My Car Insured for If I Cancel My Policy

Once you file a cancellation form with your current automotive insurance company and all of the paperwork is processed, your vehicle will no longer be insured. This means that you cannot drive the vehicle on the roads of the United States, unless you are willing to pay hundreds to thousands of dollars in fines and possibly have your license suspended. If you cancel your policy, make sure you have a new one lined up and ready for activation so you are not stuck in one spot for more than one day.

Get Free Car Insurance Quotes >>

Factors that Affect Rates

There are many more safe young drivers than those who take risks. However, the age group running between 16 years to 24 years is more likely to have accidents than any other. If you have a record of accidents, or if you have moved a great deal, then your rates won’t decrease much when you hit 25.

For many, car insurance for those under 25 can swallow a large chunk of any budget. The best way to keep down costs is to just take out the minimum coverage, although you’ll only be able to do this if you don’t have an auto loan.

Tips for Getting Car Insurance for 22 Year Olds >>

Rate Decrease

On average, you’ll find that the auto insurance premium will decrease by up to 20 percent for males when they turn 25. That figure is generally less for females and is usually between 12 percent and 15 percent. This is because young females are generally deemed to be safer drivers than young males and pay less at a younger age.

Over 25

The rates for car insurance for those over 25 will be dictated by your driving record and the type of car you drive. It will be rare that the rates don’t decrease even if your record is less than perfect. Expect to breathe a big sigh of relief when you receive your first insurance bill after your 25th birthday.

Learn more about The Average Car Insurance Rates by Age >>

Get Free Car Insurance Quotes >>

Does My Insurance Cover Another Driver?

Knowing what car insurance will cover and what it will not is especially important when it comes to friends driving your car. There is a wide variety of car insurance available to you, each with its own features. Before you let a friend borrow your car, you should know if your auto insurance coverage applies to them. Go through the definitions of the different types of coverage to get an idea of the protection they offer. Then call your insurance company. They will be able to give you a complete rundown of coverage features.

Liability Coverage
Liability car insurance coverage follows a driver no matter what car they are driving. Most states require at least liability coverage and many states have assistance programs for low income residents who qualify. Liability coverage is what allows a driver to drive a friend's car and still be covered under their own auto insurance policy. If you plan to allow your friends to drive your car, one of the questions you should ask is about what kind and level of insurance coverage they already own. Knowing the answer may prevent problems down the line should they be driving your car and an accident occurs.

Learn more about Car Insurance for Young Drivers >>

Comprehensive and Collision
Comprehensive and collision auto insurance coverage are specifically linked to the car that is being covered. These policies provide coverage for damage that may occur to a car as a result of an accident or vandalism. Charges for comprehensive and collision coverage are usually higher than liability coverage and they are additional expenses to the policy.

Other Drivers
The question of allowing other drivers to drive your car and whether or not they will be covered by your existing auto insurance is an important one. Unfortunately, there is no blanket yes or no answer, since this is something that varies from policy to policy.

When purchasing auto insurance, you should talk to the agent about who precisely is covered and what happens if you give permission to someone to drive your car and there is an accident. If you have complete coverage, many insurance carriers will cover the driver, but only at the minimum coverage limits. However, there are certainly insurance carriers who will not cover any driver who is not specifically named in the policy.

Another important factor can be where that person resides and if they are related to you. In general, if someone is living in your household and they regularly drive your car, then the insurance carrier expects you to have that person named on the policy. They will need to undergo the same underwriting and qualification process as any other policy holder.

In some cases, if a family member is visiting and has permission from you to drive the car, then the insurance company will cover them if there is an accident, but the coverage may be limited. Additionally, in the future, that person may be specifically excluded from any future inclusion on the policy and your rates may increase as a result of any accidents.

When purchasing auto insurance, carefully review the details on excluded drivers and any limitations on coverage for anyone driving the car who is not specifically named on the policy.

Get Free Car Insurance Quotes >>

Someone Else's Car: What Drivers Does Auto Insurance Cover?

In the event that you find yourself in this situation, insurance coverage when driving someone else's car is, in general, the coverage you carry for your own vehicle. Your personal auto insurance coverage will apply in most cases when you drive a vehicle not your own. This includes any uninsured motorist coverage you carry and the medical portions of your policy. Although not always, your property damage coverage might carry over while driving another's car as well. As should be expected, if you drive your own car without insurance, do not expect that you are covered when driving another's car.

When You Are Covered
If you carry auto insurance for your own vehicle, when driving another's car, typically you are covered by your own policy in the event that you get into an accident. Certain factors may be weighed including the reasons for driving a car other than your own, if you had permission or not or if it was a rental or dealership loaner. In each case, the individual circumstances will be investigated, but generally speaking you are covered by your own insurance.

With some policies, provided the car is insured, the insurance will cover any drivers of that car. This is not always the case, though. Some insurers require that all drivers be listed in order to be covered. One detrimental consequence of this involves the car being stolen. In some instances, if the car is stolen and the thief gets into an accident, your insurance won't cover the damages, sticking you with the bill. It only applies if you have given permission for a particular driver to operate your car.

With comprehensive insurance which covers almost everything, it is the car rather than the driver that is covered. This, however, requires many stipulations to be put in place such as who is allowed to drive the car. If you are driving a car with this type of insurance, if you are not listed as a driver--even if you have permission--you may not be covered in an accident.

Under normal circumstances, provided either the car you are driving is insured or you carry insurance for your own vehicle, an accident will be covered. Since insurance follows the car, the insurance covering the car you are driving (with permission) will cover at-fault accidents. If the car has no insurance attached to it but you do, your insurance will most often kick in and cover you. It is a complicated situation, but as long as you have permission to drive another's car and either the car or you have insurance, you will be covered in the event of an accident. The best thing to do, however, is check the exact stipulations of yours or your friend or family member's insurance company.

Get Free Car Insurance Quotes >>

Related Questions and Answers

Does my Auto Insurance Cover any Driver?

Most auto insurance polices will cover any legal driver that gets behind the wheel of your car. However it is best not to assume this is the case. Individual policies vary from company to company and person to person. Typically the crux of the issue is if the owner gives another person permission to drive their vehicle. In these instances, nearly every policy will cover another driver. Drivers without permission are almost never covered by insurance policies. Prior to making an important assumption, it is recommended you check with your insurance agent before allowing other drivers behind the wheel of your car.

Does Comprehensive Insurance Cover Other Drivers?

Most of the time, your comprehensive insurance will cover drivers that you allow to operate your vehicle. Your policy may vary, so you should check with your insurance provider prior to allowing anyone else to operate your vehicle. Family members (such as kids or a spouse) are generally already included in your policy. No insurance will cover a driver that operates your car without the owner's permission. Your terms and conditions may vary depending on your provider.

Does my Auto Insurance Cover Other Drivers in Another State?

Generally your vehicle auto insurance will cover a driver from any state as long as he or she has permission to operate the vehicle. However, this isn't always the case. In all instances when someone else operates your car, you should check with your agent prior to allowing others to drive it. Auto coverage and policy may vary (even greatly) depending on your company and the insurance options you have picked. It is always a good idea to review this information ahead of time.

Will my Insurance Cover an Accident with my Car if I Was not There?

In order for your insurance to cover an accident when you are not present, you will need to have comprehensive auto coverage. Assuming this is the case, then the answer is maybe, but probably. The instances in which your car became involved in the accident definitely matter. If the driver is a relative, then most likely your insurance will cover the accident. The driver also needs to have had your permission, otherwise your insurance will most likely deny the claim (unless the vehicle was stolen). Individual insurance companies and policies may vary in regards to these rules, therefore you should always check with your agent prior to allowing anyone to operate your vehicle.

Is a Driver Covered by their Insurance when Driving a New Car Home?

Once you get a car loan and purchase a new car, you can then take it home. Most states require you acquire proof of insurance, or notify your agent, prior to allowing you to take your new vehicle off the car lot. Should the unthinkable happen, your car insurance will cover you in the event of an accident. This is the reason you need to contact your agent and get the paperwork faxed to the dealership. Each auto dealership is required to make sure you are legally operating the vehicle prior to leaving the lot.

What are the Auto Insurance Minimum Requirements for California

Almost every state has an auto insurance minimum requirement. California is one of the states that has minimum insurance requirements. The state requirements of California are as follows. $15,000 for bodily injury liability; this is the maximum amount that will be paid for one person that is injured in an accident. $30,000 Bodily injury; the maximum amount for all the injuries in the accident. Finally, $5,000 for property injury liability per accident. These coverages are liability coverages which pay the medical bills of the accident victims. Your injuries and vehicle are not covered. These minimum requirements would be far from sufficient if you are in a serious accident.

Get Free Car Insurance Quotes >>

Progressive Casualty Insurance Company

Progressive is a great insurance company that enjoys a lot of positive feedback from customers with respect to price and confidence. Here are the features that clients like the most about Progressive:

• The offering of structured insurance options ranging from Choice to Minimum, Economy and Plus, all at competitive prices.
• Offering a price comparison option through their popular comparison shopping module.
• Waving off the usual 25% down payment required by most other insurance companies.
• Allowing an 18-day window to gather and send in necessary documentation on currently insured cars.

If you are planning to pick up a quote from Progressive, however, you should be aware of the following requirements:

• If you choose to pay monthly premiums, you must choose their EFT feature. This enables automatic monthly fund deductions from your bank account.
• Progressive offers a variant of GAP insurance called the Loan/Lease Payoff coverage to its customers. Details are available on their website at www.progressive.com.
• Get Free Progressive Quotes >>

Allstate

The cheapest insurance is not always the best. Therefore, though Allstate has a public reputation of being a little more expensive than others, the following features still make it the choice of many:

• Accident forgiveness offers
• A yearly reduced deductible/no-claims discount when you remain claim-free

Many clients have complained about the speed of getting coverage through Allstate. This might, however, be related to their attention to detail and trying to get everything right.

Allstate is one the leading providers of GAP auto insurance, with details found at www.allstate.com.

State Farm

This is one the biggest insurance companies in the world. The company was propelled by good and innovative insurance practices introduced by its founder, George J. Mecherle, in 1922. The firm has the following features to its credit:

• Great reputation as a foremost insurance company
• Rare standards of reliability - a gem in the insurance world
• Low rates compared with the quality of coverage
• Get Free State Farm Quotes >>

The firm boasts of reliable local agents that will always be there when you need them most. Though recent premium increases saw the defection of many of their clients to other insurers, the company has maintained its reputation as being one of the most reliable in the field. More details are at www.statefarm.com.

AAA (American Automobile Association, Inc.)

AAA consists of several independent clubs and organizations pledged to offering different kinds of services to the community. AAA offers a great GAP insurance coverage. The special features of AAA include the following:

• Good insurance coverage at affordable rates
• Free towing services in the event of a collision
• Fringe benefits like free travel maps, lodging reviews and guidebooks
• Discounted AAA-approved hotel rates
• Discount travel packages
• Get Free AAA Quotes >>

Details of their coverage are available at https://www.texas.aaa.com/en-tx/Pages/Home.aspx

Though no insurer is completely void of faults, these 4 have managed to stay above board as gap auto insurance providers.

Related Questions and Answers

Is Buying Gap Insurance Necessary for Leasing Cars?

Buying gap insurance should always be a consideration when leasing a vehicle. While it's not necessary, it can save you a lot of money in the event of an accident. This is due to the setup of the collision insurance you were required to purchase with the vehicle. It will cover damage to the vehicle in a collision, but will not take care of payments, taxes or other fees to get out of the lease. Gap insurance can help cover these expenses so you're able to get into another car quickly and avoid having to come up with a payoff on the totaled vehicle lease.

What Is Single Limit Liability Coverage?
Single limit liability coverage is auto insurance that provides one flat amount for coverage limits. For example, a policy owner may choose total per incident liability coverage of $300,000. This amount would include any and all claims for a single accident for bodily injury and property damage. Also, the limit would be applied for everyone involved in the accident, so that everyone would share in the limit of $300,000 in our example.

Single Limit Liability vs. Split Limit Liability Coverage
While single limit liability auto insurance coverage provides one limit cap over an entire accident incident, split limit liability coverage divides the coverage limits up over 3 areas--one amount for bodily injury per person, one amount for bodily injury for the accident and one limit for property damage for the incident.

Using the example above, the single limit liability amount is $300,000 for the entire incident. However, with split liability coverage, the liability limit caps might be $100,000/$300,000/$100,000. This breaks down to $100,000 medical bodily injury coverage per person, $300,000 bodily injury coverage for the entire accident and $100,000 total property damage limits.

Advantages of Single Limit Liability Coverage
For individuals with assets such as a home or business, a single limit liability policy can have several distinct advantages. Very often, if you have assets to protect from potential law suits, you will automatically carry an additional umbrella insurance coverage, which is an added expense.

However, a single limit liability coverage policy virtually eliminates the need for an umbrella policy to protect from auto insurance law suits. This is because having a single "pot" for claims for an accident enables an insurance carrier to divide the entire limit amount as needed according to the related claims. For example, if an accident results in a high amount of property damage but very little bodily injury, the bulk of the claims will be dedicated toward property damage claims payouts.

In many cases, carrying a single limit liability coverage policy will actually result in limits that are more than adequate to cover any claims that result from an accident. This is in contrast to split limit liability coverage, which very often results in a gap between actual claims and limits on the coverage. The result of this situation is very often a personal injury law suit against the policy holder in an attempt to recoup any unpaid expenses, placing home and businesses at risk.

Should you be at fault in an accident, you would not be limited by a pre-set damage amount and be left with the burden of making up the difference between what your policy covers and the balance of the claim made by the injured. Having combined single limit coverage can save you in the long run.

Disadvantages of Single Limit Liability Coverage
The primary disadvantage of single limit liability coverage is that it is more expensive than split limit coverage. For individuals with no assets to protect, and who wish to avoid higher auto insurance premiums, the benefits of a single limit liability policy will probably not outweigh the disadvantages enough to justify the higher premiums.

Another disadvantage to a single limit coverage policy is that resolution of claims may take longer, particularly in large accidents or ones that involve several different claimants. Since all of the claims are being pulled from a single limit amount, the insurance company may require that all claims be submitted before settling and closing out the case.

How to Get the Best Single Limit Liability Rates

Single limit liability may be the way to go for many people. It can be much easier to understand single limits, and can make your insurance much simpler. Here'what you need to know.

Be Clear about What You Need
Shopping for insurance rates can be difficult, since there is no such thing as a standard. Different states require different minimum amounts on liability. When you compare auto insurance quotes, you may be comparing different policies without realizing it. The best way to do this is to actually speak with someone and be clear about the quote you want. If you are looking for a $300,000 in coverage, be sure to tell the agent this is what you need. This way, you aren't getting quotes with different levels and other things added in.

Always Look for as much as You Can Afford
If you are getting quotes that are below what you can afford, consider upping the coverage slightly. It's always better to have a little more when it comes to single limit liability. This will protect you if an accident causes you to cap your insurance out. Sometimes, the best rates aren't always going to give you the best coverage.

If you have questions about how single limit works you can always speak with an insurance agent. In most cases they are perfectly willing to go over your options in detail with you. Single limit liability coverage is a good choice for many people.

Applying for Single Limit Liability Online

Applying for this type of car insurance online is a simple and easy process.

• Gather all of your relevant information. This includes your contact information, car make and model, latest mileage reading and company finance information. You also need to provide your driver's license, social security number and driving history. You may also be asked about your employment and residence history. Finally, review your credit report, since many companies now use credit history as a factor in rate quotes.
• Choose an online resource. There are numerous online insurance websites to utilize when researching car insurance rates for single limit policy coverage. The 2 primary types of websites are specific company websites, and insurance clearinghouse websites. Specific companies that offer auto insurance, like Progressive, Travelers and others, provide information about that company's policies and rates. Clearinghouse websites allow you to apply for insurance and then see quotes from several different companies for side-by-side comparison of rates, benefits and company rating.
• Complete the online application. You will be asked to provide information about your driving history, the car, make and model you want coverage for and contact information. You will also be asked to provide your driver's license number and social security number.
• Review policy quotes. In some cases, you will be given a policy quote immediately after you complete the application information online. You may also be provided this information in an email or even in a follow-up telephone call by an agent wanting to discuss several different quotes or potential policies.
• Choose your coverage and make a payment. Very often, you can secure single limit liability car insurance coverage immediately. Once you make your first payment, you can immediately print your evidence of coverage to place in your car and present to you local DMV if needed.

Related Questions and Answers

Triple AAA car insurance is offered by the Automobile Association of America, also known as Triple A and AAA. Although the company is more known for its roadside assistance, they have created a niche in the insurance market as well. If you are contemplating getting Triple AAA car insurance, here is some information that could help. AAA basically offers 3 types of auto insurance: coverage for others and their property, coverage for you and your passengers, and coverage for your assets.

Get Free AAA Insurance Quotes >>

Roadside Assistance
AAA car insurance is famous for its emergency road service. If something goes wrong on your trip, all you need to do is call them. They offer 24-hour roadside service. If you have a flat tire, your spare tire will be installed. If no spare tire is available, the vehicle will be towed up to a certain number of miles, as specified in the policy. This service also is helpful if your keys are locked inside your vehicle. If the service provider cannot open the car, locksmith service or reimbursement for commercial locksmith service will be provided, up to the prescribed amount. If you run out of fuel, you will be supplied with enough fuel to reach the nearest service station. If you are an AAA Basic member, you will have to pay for the fuel. Other services include toll free assistance, battery service, extrication or winching services, reimbursement for services and roadside or repair check acceptance.

Guides
AAA Car Insurance is also known for their helpful guide and map tools, free for those who are part of the service. These maps and guides give you turn by turn directions, making sure you have the tools to find exactly where you are going when going on a long trip. All you have to do is call the prescribed phone number and speak to the representative, giving details of your membership.

Customer Service Record
AAA car insurance is also known for its customer service track record. The company has friendly and fast customer service that looks out for the customers and insurance holders. The discounts given to AAA car insurance holders at various businesses nationwide are also looked at as a benefit of their car insurance.

What's Offered in the Policy
AAA includes coverage for the following:

• Liability Insurance: States have their own laws pertaining to the minimum mandatory liability coverage.
• Uninsured Motorist: Under this coverage, if you are injured in an accident and the person at fault does not have auto insurance coverage, your insurance will cover it.
• Comprehensive Coverage: This protects members from theft, storm damage, and other situations that are not the result of a collision.
• Medical Coverage: If you are an AAA policy member and injured while walking on the road, or in someone else's car, you can claim medical costs.
• Collision Coverage: You are covered here if your vehicle collides with something other than another vehicle.
• Rental Car Reimbursement: If you have comprehensive or collision coverage, and your vehicle is out of service for over 24 hours, you will be reimbursed for rental car expenses.
• Get Free AAA Insurance Quotes >>

While the liability coverage is mandatory, all the others are optional depending on what you choose and pay for.

Disadvantages
Triple AAA car insurance is only available to its members. That means you have to have an annual membership to use their benefits. The membership may cost between $60 and $100. It depends on how many benefits you buy, and the number of persons included in the plan.

Another disadvantage is that extrication and winching services are not included for snowbound vehicle recovery. Service providers will not shovel snow, mud or sand to tow your vehicle. Moreover, if you are in an area that is not defined as a "road," this service is not applicable to you. For example, vehicles will not be recovered from beaches, vacant lots, playgrounds, creek beds, open fields, boat ramps and forest or private roads.

Creative Commons photo by abraham.williams

Get Free Car Insurance Quotes >>

Cash Value versus Replacement Value

Many auto insurance policies use cash value as the payout factor for repairs or replacement. Cash value is not the same as replacement value and it is important to understand the difference.

Cash value is based upon the actual value of the car at the time of the repair or replacement. In order to determine this amount, car insurance companies have databases of information on all of the various cars on the road today. The database has information about the make and model of the car, original purchase price, average mileage, and wear and tear. All of these factors determine the depreciated value of the car. This is what the actual cash value of the car is for the insurance company and what they will base any payouts on.

Depreciation is something that begins the moment you drive the car off the lot. Even if you were to decide to return the car the week following your purchase of the car, you would find that the car has depreciated in value simply because you bought it. Actual cash value insurance policy provisions take this into account.

Replacement value, on the other hand, is the actual cost to purchase another similar car. Often, this amount is based on what it would cost to purchase a brand-new car. For example, if you total a car that is two years old and you have replacement-value coverage, then you would be reimbursed to go and purchase an equivalent new car.

Unfortunately, for many drivers, the actual cash value of the car is much less than what they owe on the bank. If their car is totaled, the insurance company will pay off the cash value, but the vehicle's owner will be left with the balance that remains between the cash value and the actual amount needed to pay off their loan. Having car insurance that provides replacement value avoids this problem. However, replacement value coverage is more expensive, so many car owners choose to forego it.

Get Free Car Insurance Quotes >>

Gap Coverage

For individuals who are leasing a car, gap insurance coverage is also an option to make sure that they are fully covered for the entire value of the car. Very often, auto insurance for leased cars only covers the amount of the lease and not the total value of the car. If the car is totaled, however, the finance company will expect the person who leased the car to pay off the entire value of the car. Gap insurance provides coverage for the difference between the lease value and the purchase value of the car. Some lease finance companies require gap insurance as part of lease terms.

It also reduces premium costs by lowering legal fees and court costs. Some states, however, are opposed to PIP insurance coverage because it limits the individual's right to sue. Since the no-fault system doesn't allow you to sue people who crash into you, you are required to buy PIP coverage in the states that use this system. Let’s look at the states that require it.

States that Require PIP Insurance Coverage

Along with the District of Columbia and Puerto Rico, there are 15 states in the U.S. that use the no-fault system and require you to buy PIP insurance coverage:

• Delaware
• Florida
• Hawaii
• Kansas
• Kentucky
• Massachusetts
• Michigan
• Minnesota
• New Jersey
• New York
• North Dakota
• Oregon
• Pennsylvania
• Texas
• Utah

Each of these states requires a different minimum for PIP coverage, so you should familiarize yourself with the local insurance laws if you happen to live in one of these states.

Features

PIP insurance coverage will pay you a certain percentage the damage caused in an accident for which you were not at fault. PIP insurance will also cover the costs of transportation to the hospital and other costs associated with personal injury.

Related Questions and Answers

What is the Recommended Coverage Option for Personal Injury Protection Insurance?

Personal Injury Protection coverage is not required by all states, so make sure your state requires it before you purchase coverage. PIP basically covers the cost of medical treatments for the driver and passengers. This type of coverage is especially important if you do not have medical insurance as you can be held liable for significant medical costs if you are in a major accident—this insurance will mitigate these costs. If you have medical insurance, you should purchase the minimum PIP your state requires. The majority of insurance companies will not sell more than $25,000 worth of PIP coverage, so your choices are pretty limited.

On Average, How Much Extra will Personal Injury Protection Cost Me on Car Insurance?

The cost of personal injury car insurance will vary for each individual driver. Insurance companies will take your driving record into account as well as your credit rating, the type of vehicle you are driving, and the amount of coverage you purhase. PIP insurance tends to fall into the middle group—it is not the most expensive coverage, nor is it the cheapest. As an average, budget roughly $5 to $20 per month for this coverage. PIP is not required by many states, so if you have adequate health insurance, this coverage is sometimes not necessary.

Does Personal Injury Coverage Cover Injuries for the Other Party Involved?

No, personal injury coverage helps cover the cost of your medical bills as well as other passengers in your vehicle. It will also help cover the medical costs of injured pedestrians, but it does not cover the other party involved in the accident. In addition to medical bills, PIP will often cover lost wages and funerals. PIP usually covers the driver first, and if there is coverage left, it can be used for the passengers in the vehicle. This type of coverage is often supplemental to health insurance. If you have high-quality health insurance, PIP is sometimes not necessary.

Get Free Car Insurance Quotes >>

1. AAA Insurance

The American Automobile Association (AAA) has been a leading provider of automobile insurance for many decades. Its customer satisfaction is second to none and always delivers both quality of policy coupled with incredible benefits for being a member. It offers many different kinds of insurance policies as well as car repair insurance. AAA gives its policyholders the freedom to choose where they want their work done, but it also provides a list of repair shops it works with. Most of the time, this list will contain the shop you want to use anyway.

2. GEICO

If you watch a decent amount of TV, then you have no doubt seen that cute—albeit a tad annoying—GEICO gecko at least a zillion times. Most folks think of collision insurance when they hear that tiny Aussie gecko talking on TV, but GEICO has also taken the leap into the car repair insurance game with its Mechanical Breakdown Insurance offering.

Need Car Insurance? ZIP

3. Warranty Direct

Another leading provider of short term car repair insurance and limited warranties is called Warranty Direct. This is a financially sound company that has been providing new and used warranty service for many years. One of the pitfalls when working with an insurance company is whether or not it will honor its policies or have a lot of different fine print clauses. Warranty Direct seems like one of the most honest ones, as it is a leader in customer satisfaction.

4. Endurance Warranty

Endurance is one of the newer companies in the car repair insurance game. This company is most recognizable by the direct mailers it sends out to people that look quite official and make you think that some warranty on your vehicle is set to expire. Despite its grey-hat marketing schemes, Endurance's A+ rating from the BBBactually suggests that it delivers good service.

5. CARCHEX Insurance

The CARCHEX Insurance company is also one of the more popular insurance companies that receive the greatest customer satisfaction rewards. It works with each new customer to help tailor a customer insurance policy that will reflect their needs instead of a generic policy. In an industry that generally gets a lot of complaints, CARCHEX is near the top in delivering a great experience for its policyholders.

The decision between risking a repair that could run into the thousands of dollars on your used car, buying a new car, or shelling out a monthly payment on a car repair insurance policy can be a tough one. However, with the five most popular companies offering these cost-mitigating policies in hand, you are now better prepared to perform the research you need to make the best decision.

Get Free Car Insurance Quotes >>

Why Car Insurance Is Usually Cancelled by the Insurance Company

When policies are cancelled, it often happens in the first 60 days of acceptance. In this period the insurance company checks your record, and doesn't have to offer a reason for canceling your car insurance policy.

The usual reasons for having car insurance canceled are for making false claims on your application, having too many accidents on your record, or for having a DUI conviction. Different states allow insurance companies to drop you for different reasons.

Not making your Insurance payments can also result in their cancelling you.

If you feel you've been wrongly dropped, you can appeal the decision and even take the company to court. However, you'll still need to obtain new car insurance during this time.

Get Free Car Insurance Quotes >>

Cancelled Car Insurance Means You Can't Legally Drive

It doesn't matter in which state you live, it's illegal to drive without insurance. Once your policy has been cancelled, you're off the road until you obtain new insurance. In the case of shared car insurance, a cancellation of the policy will affect everyone named, so that would involve the entire family.

If you're caught driving without insurance, you'll face a fine, court fees, a conviction on your record and you'll probably have your license suspended for a period of time.

How to Deal with a Car Insurance Lapse >>

The Effect Cancelled Insurance Has on Car Loans

If you drive a car on which you're making payments, one of the conditions of the loan is that you have full insurance. This covers the company lending you the money in case of an accident.

The insurance company will inform the company that it's canceling your car insurance policy. At this point, three possible things might happen:

• The company gives you a short period in which to obtain new insurance
• The company imposes its own insurance and adds it to your monthly payments
• They repossess the vehicle, as you'd be in violation of the contract
• Get Free Car Insurance Quotes >>

How It Affects Your Getting Insurance Policies in the Future

When asked why your policy was cancelled, and any other questions relating to your past driving records and insurance and loan situations, give a truthful answer. It will affect the number of companies that will be willing to insure you, and also the amount you'll need to pay to obtain car insurance. However, at least you should be able to obtain car insurance, which you'll desperately need after having your old car insurance cancelled. Shop around and obtain quotes from a number of companies before making your choice.

Can I Get My Money Back? >>

Your Decision to Cancel the Insurance
Choosing to cancel your insurance is fairly straightforward and it is usually done when you are switching insurance from one provider to another.

If you're thinking of canceling your auto insurance, you might want to reconsider. There may be times that you want to cancel an auto insurance policy because you have found a cheaper insurance company or maybe you simply don't have a car anymore. While you never want to have insurance on a car that you don't own, you may want to consider waiting--if you simply found a cheaper policy. The reason is many auto insurance companies (if not most) will charge you a hefty cancellation fee for choosing to cancel your policy.

Depending on the insurance company that you use, policy cancellation fees may run from as little as $50 all the way up to the full cost of the yearly premium amount. Moreover, some insurance companies will also recalculate your premium at a higher rate and charge you the difference--especially, if you use direct debit to pay your insurance premiums.

Currently there are no laws that prohibit insurance companies from charging the cancellation fee, nor are there any laws that regulate how much the insurance company can charge. Therefore, you're at the mercy of the insurance company when you choose to cancel your policy. So, you might want to consider simply not renewing your policy and moving to a cheaper policy when it's time to renew.

Get Free Car Insurance Quotes >>

The Difference between Cancellation and Non-Renewal

Auto insurance non-renewal typically happens when your insurance provider decides not to renew your auto insurance policy. This happens for a variety of reasons that include a poor driving record, too many accidents or excess claims against the company. In these cases the insurance company will notify you in advance, typically one month ahead of time. Obviously a non-renewal will not endear you to other insurance companies and could be a deciding factor in decisions to not give you insurance. Drivers that feel that they were dropped without cause usually have the option to appeal the process.

Common Car Insurance Cancellation Scams

The most common type of scam is usually run by small insurance companies claiming to be cheaper than the major companies. In this scam, known as low-balling, the insurance company quotes an unusually low rate to the customer. About a month after the customer signs a policy, he or she receives a letter saying that due to a "company rate error" the premium quote was incorrect, and requests a higher payment. The company threatens to cancel insurance should the customer not pay the higher rate.

The best way to avoid this scam is to deal only with established insurance companies. Well-known insurance companies are less likely to participate in this type of scam, as it would create negative publicity. Most scammers operate small companies that cannot be easily traced to a physical location.

False Insurance Company
Another common scam is that of the fake insurance company. Scammers set up a company that looks like an actual insurance company. After the customer pays, he or she receives insurance cards that are missing key details such as policy numbers. When the customer attempts to file a claim or shows the card to a police officer during a traffic stop, he discovers that the company does not exist. He is then left with legal and financial consequences to deal with.

The best way to avoid this scam is to realize that if a company's offer sounds too good to be true, it probably is. You should always check the reputation of any previously unheard of company with the Better Business Bureau before doing business with them. You can also use Google to search for a company name. Often, a Google search will turn up any complaints customers have about a particular company.

Be Cautious When Purchasing Online
It is also best to be cautious when buying auto insurance over the Internet. Many scammers operate online and do not provide any contact information other than their website. In addition to low-ball scams, some con artists might create fake company web pages in order to steal your personal information. Never provide sensitive data such as your driver's license or Social Security number to unknown companies over the Internet unless you know for a fact that they are a reputable company.

Small Insurance Companies
The final scam customers should be aware of is technically not a scam, but happens often enough that it could be classified as one. Often, small insurance companies offer significantly lower prices in order to compete with the major companies. However, the prices are so low that the companies do not earn enough money to pay off claims appropriately. As a result, if a customer files a claim, the insurance company is unable to provide the promised coverage. The customer ends up paying out of pocket for expenses that were supposed to be covered by the insurance.

Get Free Car Insurance Quotes >>

What Is Actual Cash Value?
When you purchase a car, the moment you drive the car off the lot it depreciates in value. Even if you were to decide to turn around the sell the car for some reason the next week, the car is still lower in value than the purchase price. This is part of what is taken into account when insurance companies calculate actual cash value.

Other factors include the age of the car at the time you make a claim, the amount of miles driven on the car and average wear and tear to the car. In addition, if there is unusual damage to the car this also may be taken into account. The older a car is, the lower the amount of the actual cash value. Actual cash value will always be lower than the amount of your car loan, especially if you purchased the car brand new and have financed it for several years.

All of this information is taken into consideration in actuarial databases that compile information on which an insurance company bases what it offers as the actual cash value at any point in time during the life of the car when you make a claim.

Actual Cash Value vs Replacement Cost
As you can see, the actual cash value is usually nowhere near what it costs to replace a car. If you have a major accident and the car is totaled, the cost to turn around and purchase a new car will always be higher than what your old car was worth at the time of the accident.

Replacement value is an option for car insurance that addresses this problem. Instead of choosing the actual cash value option, choose coverage that provides for replacement value. In many cases, not only is payment provided to purchase a new car, but additional expenses like sales tax, title and transfer fees may also be included, although you may have to ask for these expenses to be included or covered. Replacement value car insurance is certainly much more expensive than accepting actual cash value coverage. However, for many people, the added premium is well worth it when they consider the expense of replacing their vehicle.

Get Free Car Insurance Quotes >>

How Is the Actual Cash Value Determined?

One of the ways the value of an asset is determined is to calculate or decide what the replacement cost of a car would be, then deduct an appropriate amount for the age and wear of the car. By definition in court cases, the replacement cost is described as "the entire cost of complete repair or replacement of an asset--taking no deductions for depreciation." This indicates clearly that the replacement cost is higher than Actual Cash Value. So the replacement cost is calculated, then deductions are made to arrive at the actual cash value of an asset such as a car.

Sometimes this definition favors the insured, and sometimes the insurer. For example, imagine a car with an estimated value of $14,000 is destroyed in a tornado. The insurer has defined the actual cash value as the cost of replacing the car minus deductions for age.

Replacing the car often costs more than the car it is worth at the time, particularly if it had high mileage or a great deal of wear. The cost of new cars goes up over the years, and cars always depreciate over time.

If the replacement cost is higher than the car is worth on the market--say it costs $20,000 to replace with a new car--then the insurer ends up with a higher settlement using the replacement cost method to determine actual cash value.

Fair Market Value
The simple definition of fair market value is "what an interested buyer is willing to pay a seller interested in selling." This seems fairly direct, but there are complications in its determination, as is common in insurance issues. Fair market value can be tricky to determine when it comes to unusual or unique objects.

It is sometimes difficult to determine what the market price is for particular vehicles, especially those that hold their value particularly well, are collector's items, or sports cars.

Auto Insurance: ACV
Note that auto insurance pays the actual cash value for any vehicle. As with other depreciating items, in most cases it makes little difference whether they calculate this value using the replacement cost minus depreciation or the fair market value. The amount will be similar.

This is important to remember, particularly with new cars, since you can easily owe more on a car loan than the insurance company will pay you in a settlement, and you will be left making up the difference.

Knowing your insurance policies and their provisions for actual cash value on damaged assets can be valuable to you. Remember that in a loss, you may get much less from the insurance company than it costs to replace your property.

Get Free Car Insurance Quotes >>

Tips for Negotiating the Actual Cash Value of Your Car

Here are some tips for helping drivers to figure out how to get a decent deal from an insurer.

1. Find out about actual cash value. The term itself just refers to how much a vehicle is worth in sale, but it's the way actual cash value is used that leads to some problems with negotiating a fair deal when you need to collect from an auto insurance company after a wreck.
2. Figure out how your insurer defines actual cash value. Part of the problem in negotiating a good actual cash value for a vehicle is that each insurer uses their own proprietary methods to get what they give you as ACV. In order to provide your own counter-estimate, you'll want to know as much as possible about how they came to their figures.
3. Use online car valuation sites to get a good actual cash value estimate. Online car value sites provide solid, well defined, and commonly recognized value estimates for nearly any vehicle on the American roadway. Take a look at sites like the Kelley Blue Book company site to get what many would consider a fair resale price for your vehicle.
4. Look for local examples in classifieds or elsewhere. Another way to provide solid valuation evidence is to look for ongoing deals from local dealerships for used cars similar to yours. You can use the sale prices offered by the dealerships as an indication of actual cash value for your vehicle.
5. Include information on features and other value conditions. Low mileage, excellent interior and exterior condition, and handy features should be pointed out to your insurer as "value points." Make sure they know about features that you have added to your vehicle after purchase, such as enhanced sound systems, that may add value.
6. Stay involved. Negotiating actual cash value, just like a lot of other insurance documentation, is mostly just the process of communicating and staying in touch with the insurer to eventually wrangle out a deal. Those who give up easy will find themselves settling for the lowest possible value and partial payouts from insurers who are slow to comply with their responsibilities in the event of a claim.
7. Get Free Car Insurance Quotes >>

Take advantage of these simple steps to claim what's yours in a situation where you find your insurer has miscalculated the actual cash value of your vehicle.

Related Questions and Answers

How Do Cash Value Loans Compare to Regular Loans?

Cash value loans compare to regular loans in a couple of different ways. Cash value loans are almost identical to regular loans because they both calculate an interest rate, how much money is needed, and whether or not the borrower is approved for the loan. Should you take a loan against your automotive insurance policy, whether it is a cash loan or a regular loan, you will need to pay the total amount of the loan back to the insurance company with interest. If the loan is not paid back by the time you die, then the remaining value and interest will be deducted from the death benefit of your life insurance policy.

Does Actual Cash Value Include Taxes?

Depending on which state you purchased a new car in, your actual cash value will include taxes, but in some states it will not include taxes. Actual cash value will always be lower than the amount of your new car loan because as soon as you drive off of the lot with the car it depreciates in value. Your car continues to depreciate, lowering its cash value, depending on the age of a car when a claim is made, how many miles have been driven using the vehicle, and the average wear and tear of the vehicle over the time it is owned.

Is Car Loan Value Different than Actual Value?

Your car loan value will always be different than the actual value of your vehicle. This occurs because of the vehicle's depreciation. A vehicle depreciates as soon as it is driven off of the car lot. The value of the vehicle reduces even if the owner decides to sell it a day or a week after it has been purchased as brand new. Even if the buyer wants to return the vehicle for some odd reason, he or she will not get all of their money back because it is now considered a used vehicle. It does not even matter if five miles have been put on the odometer.

Where Can You find the Actual Cash Value of Your Car?

You can find the actual cash value car price by doing some research online or visiting a local dealership. Online tools like Kelley Blue Book and Black Book provide actual cash values for cars. The actual cash value, also referred to as the ACV, is equivalent to the trade-in values listed on these web-based tools. You can also get the actual cash value of your vehicle by visiting a local dealership and asking for an appraisal from the used car manager. Simply ask the manager how much they would pay for your car if you were to sell it directly to the dealership.

Is an Accident Total Loss the Same as a Totaled Car?

An accident total loss and a totaled car are terms that are used interchangeably with each other. A vehicle is considered a total loss if it would cost the insurance company more money to repair the vehicle than its fair market value. The salvage value is also factored into the equation. A vehicle could have sustained only minor damage in an accident, but due to the amount the insurance company determined as the fair market value, it would still be considered totaled or a total loss.

What is the Difference Between Actual Cash Value and the Replacement Cost?

Actual cash value and replacement cost differ in that with actual cash value, depreciation is a factor in determining the value of the totaled vehicle. Some have defined actual cash value as the fair market value of a vehicle or the amount you would be expected to pay if the vehicle was purchased from a seller today. The insurance companies define it as the cost to replace a totaled vehicle with a new vehicle but subtracting the depreciation. Replacement cost is the amount of money it would take to replace the vehicle with a comparable vehicle without regard to depreciation.

What is the Best Source for finding the Actual Cash Value of a Car?

There are several sources for finding the actual cash value of a car. This information is an important tool in assisting you in determining whether the insurance company's settlement is fair. The most frequently used sites for assisting with this information are, Kelley Blue Book, Edmunds, and NADA Guides. Before you go to any of these sites, you need to do your homework. Take note of your vehicle's overall condition and any major improvements such as a new engine, transmission, or tires. Document the vehicle's mileage, body condition, and condition of the interior.

What is Required to Make a Total Loss Claim?

There are some requirements to be met in order to make a total loss claim. First, you need to make sure a police report is taken. Insure that any inaccuracies are cleared up before you sign the report, and do not exaggerate the facts. Make a call to your insurance company as soon as possible so that they can set your claim in motion. You should document your recollection of the events of the accident as soon as you are able to. You can do this either by writing it down or via a voice recording.

How do Car Insurance Companies Determine Estimated Car Value?

Estimated car value is determined in one of three possible ways by an insurance company. The first is the experience of the adjuster. Over time, an adjuster will gain a feel for the value of a vehicle and can use certain telltales such as overspray on body panels. Also, the lack of original VIN plates on the pieces of the car, such as fenders, to place a value on it. One has also looked at the second piece of the puzzle, KBB.com (Kelley Blue Book) where the adjuster will plug in all the equipment included in the vehicle. Plus, any other equipment that may have been tacked on. Then, they will run a KBB analysis, using the "trade-in" value to determine the fair market value of the vehicle. The third method, is to use a laptop to query the vehicle's computer system. Review the information readout. Then, using templates from the insurance company, determine the value of the car.

How do You Determine Your Wrecked Car Value?

You do not determine the wrecked car value of your vehicle, under any circumstance. The determination of the wrecked car value is left to the company's adjuster who is the insurer's official arbiter on the ground. Indeed, in determining the wrecked car value of your vehicle, the adjuster runs some special software on a laptop computer that they keep in their car. This software takes into consideration things as the frequency of service, the parts used, and the intervals the car was serviced. This could have a direct bearing on the ultimate value they place on your vehicle.

Can You Determine Car Value on your Own and Use that for Insurance Companies?

Yes, you can determine car value on your own by consulting an online version of the Kelley Blue Book, one of the bibles of the auto industry. It is one of the most reliable sources to check the value. Using the trade-in value of your car, you can determine the value that will be placed on it. While you can recommend that your agent or company to use the value you have found for your car, the insurer still must find the value themselves. Any values you find are not considered official to the insurance companies.

Progressive Auto Insurance is going for solutions. The auto insurance industry has known for years that there are certain driving habits and characteristics that can help them judge the likelihood of a driver getting into an accident and filing an insurance claim. The problem has always been how to evaluate those characteristics and habits in a timely manner before the accident occurs. With its new Snapshot Discount, Progressive Insurance is attempting to track those habits in real time and offer car insurance discounts to drivers who exhibit safe driving habits.

Get Free Car Insurance Quotes >>

Here's how the snapshot discount works: Drivers who are interested in the program will receive a small device that plugs directly into their car's on-board diagnostic port. The device then records data (everything from how often the car is driven to how quickly the brakes are applied when stopping) and then sends it back to Progressive. They will then analyze that data and inform the customer if they are eligible for a discount. In general, drivers who drive a below average number of miles on average and who exhibit safe driving habits will usually end up saving more money.

While the Snapshot Discount may seem like Pay as You Drive auto insurance, its focus on driving habits, rather than simply mileage, makes it a more refined system for judging risk.

The Progressive Website vs. Competitor Sites
The Progressive Car Insurance has one of the best insurance websites on the Internet. The Progressive.com has won multiple awards for its ease of use, functionality and user friendliness. The website allows potential customers to receive policy quotes for policies and even print them out.

For existing customers, Progressive offers a suite of tools that the customer can use to quickly review pertinent information about their policy, make payments and even make changes to the policy. In addition, the Progressive website allows customers to print out insurance cards that can be kept in the insured vehicle.

Generally speaking, Progressive offers very competitive rates for most types of car insurance. Progressive is considered to offer very competitive rates on most common types of vehicles and slightly higher rates on expensive luxury vehicles when compared to other insurance companies. Also, Progressive seems to be more popular among lower income and middle income drivers than more affluent drivers. Drivers with higher incomes have reported that companies like Geico and AIG offer better rates than Progressive for insuring expensive vehicles.

Get Free Car Insurance Quotes >>

Progressive Agent Customer Service
Progressive continues to receive very high marks for their agent's customer service. Progressive has a large number of agents all around the country that are highly trained and highly regarded for their knowledge and reputation in the community. Progressive insurance agents also receive high marks on helping customers process their claims and offering general guidance and suggestions for policies. Many reviews about Progressive insurance agents also indicate that many customers are happy with the fact that most Progressive insurance agents provide home telephone numbers on business cards and even on office doors so that contacting agents after hours is never a problem.

Progressive.com also receives good grades for its online customer service. The online customer support link is very visible on all Progressive.com pages and allows customers and potential customers to quickly and easily reach knowledgeable agents and insurance specialists. Many people report that using the help system or support system at Progressive.com site is easy and that the staff is very helpful and thoughtful.

What Is Progressive's Accident Forgiveness Offer?
Progressive is the only auto insurance provider to offer customers accident forgiveness. When shopping for insurance, drivers often seek out the best auto insurance discounts that they can find and accident forgiveness may be one of those benefits that is too good for a driver to pass up--but exactly what is it?

Drivers that carry an auto insurance policy with Progressive for 4 years and remain accident free for 3 years qualify for accident forgiveness. Once you qualify, the first accident you have, no matter if you were at fault or not, is forgiven and Progressive will not raise your rates. There is no additional charge for accident forgiveness and it applies only to the first accident you have.

Get Free Car Insurance Quotes >>

There are many auto policy incentives available and drivers with a good driving record and a history of safe driving may find that Progressive's accident forgiveness is a worthwhile incentive for them.

4 Tips for Negotiating the Best Progressive Settlement after an Auto Accident
In the aftermath of a car accident, it may seem like the worst thing that can happen to you is to make a claim with your insurers, whether you are seeking a Progressive settlement, or any sort of compensation from the main insurers. It is not surprising that many people think that insurance companies make it deliberately difficult to make claims, as they are reluctant to spend money, even if you have been using their insurance company for years. If your insurer is Progressive, then you can certainly make a claim by going through some basic rituals, and being clear on exactly how much you want to claim, and for what.

• Be prepared. If you are seeking a Progressive insurance settlement, then the first thing that you need to do is be properly prepared. You should read through all of the policy documents which Progressive have given you over the years, so that you know what you can and cannot claim for. This will make it easier when you come to filling in your forms.
• Gather your evidence. Once you have assessed your policy document, you will then know what you can claim for out of all the bills which you have incurred in the aftermath of the accident. This can range from simple car repairs to medical bills and even help with mortgage payments. You will need to have all of this evidence together, and you should also consider copying it to make sure that it is all present whenever you need to refer to it.
• Write a letter. A good way of making a formal claim is to send your insurers a letter. This letter will serve the same purpose as an insurance claim form. The letter should set out in clear paragraphs the exact circumstance of the accident, backed up if possible by evidence from the documents. You should include in the final paragraph a brief, formal claim for the exact amount of money you require. This should be written clearly and unambiguously so that the insurers know exactly how much you are asking for.
• Phone your insurers. When the letter has been sent, allow the insurers about a week to receive it, and then give them a follow-up phone call. This will let your insurers know that you are serious about this claim, and that you intend to pursue it, and will also encourage them a bit in their endeavors. If you do speak with anyone about your claim, make a note of their name, what they said, and the time you called, so that you can refer to it later, if necessary.

Making a Claim with Progressive
Getting a settlement out of Progressive should not be too difficult once you are fully prepared, and have all the documentation to prove your case. Confirm any negotiations by letter with the person you spoke to referred to by name. This will provide both of you with additional proof of your negotiations. There are no easy Progressive settlement solutions, but if you are persistent, and have a good claim, there should be no problem at all.

How to File a Progressive Insurance Claim
If you're a member of Progressive auto insurance and you get in a collision of some kind, you'll have to file a Progressive insurance claim in order to report the incident to your insurance provider. A Progressive accident claim is relatively easy to file, but the entire process of review and compensation for your claim may take up to a few weeks, depending upon the complications and the severity of the case. The Progressive insurance claims department is available for your questions to help you sort out the process of filing your claim if you should need it. However, the process itself is relatively straightforward. The crucial thing is having the information you need before you file the claim. Read on for a step-by-step guide to filing a claim with Progressive auto insurance.

1. Collect information from other drivers at the scene of the accident. Immediately following the accident, ensure that all other people involved are safe and uninjured. If anyone is injured, seek proper medical attention and inform the authorities right away. Once you and the other drivers have taken care of this and everyone is in a safe location, get the names and contact information for every other person who was involved in the crash. Most importantly, you'll need to collect the names of the insurance providers for each of the other drivers as well as their policy numbers. Also, you should note the type and year of each vehicle that was involved in the collision as well as the license plate number. Look for damage on each vehicle and try to come to an agreement with the other drivers as to what occurred. Finally, note the number of other passengers in the cars and whether anyone was injured.
2. Visit Progressive's website or phone a pepresentative. There are several ways in which you can file a claim with Progressive. The first of these is to log on to the Progressive auto insurance website. This is perhaps the fastest and easiest way to file your claim, and inputting the data on the website typically takes only about half an hour to an hour. You can also phone a representative by calling the toll free claim reports number that can be found on the Progressive website as well. Finally, if there is a branch of Progressive auto insurance near you, you can stop in and speak with an agent in person to report your accident. In each case, the information you submit will be the same. Following your report, a claims adjuster will review your materials and call you to record a testimony regarding the accident. This is useful for them in helping to determine who is at fault.

If you have any questions, speak with a representative from Progressive for additional information and assistance.

Get Free Car Insurance Quotes >>

Accident Forgiveness

These days, most major car insurance companies offer some sort of accident forgiveness program. Companies like Allstate, AIG, Geico and Progressive all have some sort of program that forgives insured drivers participating in the program in the event of an at-fault accident.

The way the program works is pretty simple. If you are involved in an accident where you are found to be at fault, an accident forgiveness program will guarantee that rates are increased at only minimal amounts, and in some cases, not increased at all. This type of forgiveness is usually an add-on option for most policies offered by the companies that provide it.

However, even with an accident forgiveness program, a second at-fault accident will usually cause your insurance premiums to rise considerably. Nonetheless, accident forgiveness programs can help you avoid cancellations or an insurance company refusal to renew your policy. One of the most advantageous parts of an accident forgiveness program is that if you are involved in accidents where you are not at fault, the insurance companies do not penalize you in most cases.

Rates Can Increase Regardless of Fault

Unless you are enrolled in an accident forgiveness program with an auto insurance company, your coverage is subject to cancellation or rate increase any time a claim is made. Some insurance companies will choose to raise your rates simply if you make a claim and request payment under the terms of the coverage policy. For instance, some insurance companies will choose to raise rates after one accident - even if you were not at fault in the accident.

While there are some states that regulate this type of activity and even prohibit it, some states do not. In states where insurance companies are not heavily regulated, this type of punishment for filing claims is not uncommon. So, with less reputable insurance companies that are quick to cancel policies, you'll usually never have the chance to file two claims with the company.

Get Free Car Insurance Quotes >>

It Does Not Last Forever

Fortunately, regardless of the number of accidents you have on your driving record - whether it be with the state Department of Motor Vehicles or with your insurance company - the accidents do not remain on your record forever. In most states, insurance companies are only allowed to penalize you for past accidents or driving violations that occurred within the last five years preceding the issuance of a car insurance policy.

So, if you can continue to drive safely for at least five years, the accidents should disappear from your driving record and you will be able to once again get preferred safe driver discounts on your car insurance.

Get Free Car Insurance Quotes >>

The Legal Background

New legislation in some states has been moving auto insurance into a tiered system. The previous system was one where a standard rate was applied to all drivers, with a "surcharge" applied to those drivers who got into accidents or high-risk categories. The tiered system does away with surcharges, replacing this with a set of risk ratings, starting with the standard rating, and going progressively higher according to a variety of calculations.

What Affects Auto Insurance Tiers

A driver may be placed in a specific level of an auto insurance tier system based on a variety of factors, including what accidents or DUI/DWI convictions are in a driver's history, whether he or she is driving a relatively high risk sports or luxury vehicle and whether the driver is located in what constitutes a high risk area (often an urban area with higher traffic accident statistics).

Results of a Tiered System

A tiered auto insurance system means that one accident taken out of context will not make a driver's individual or household policy skyrocket overnight. It means insurers will be using a more precisely defined set of metrics to find out what kind of a risk the driver really represents on the road.

High-Risk Drivers

Being in a high-risk category or 'tier' doesn't mean a driver can't shop for auto insurance rates, it just means they won't be eligible for the standard insurance rate until they can provide other data to prove a better context for their driving history. As a driver history gradually "washes clean," that driver will be more eligible for lower tiers and lower insurance ratings, and that translates into better premiums for future years.

Get Free Car Insurance Quotes >>

Consumer Information

In many states, auto insurance companies are required to show a customer what tier he or she falls into on their actual policy documentation. This is a reference for writers who want to monitor their risk rating on an ongoing basis in order to renegotiate insurance rates later. However, the number of tiers that an auto insurance company may have is not set, and some companies may have more tiered ratings than others.

Knowing the background of this kind of auto insurance system will help drivers make good decisions about which company to purchase their insurance from. Be sure to ask insurance company representatives how their company offers standard or premium rates to the best drivers, and how they can help lower costs over time for those drivers who have been negatively impacted by some part of their driving history.

Get Free Car Insurance Quotes >>

How to Stop Gap Coverage

The first step to stop gap insurance is to find your original gap insurance contract. If you cannot locate it, contact the program administrator or the dealership if you purchased your car at one. Once you find the contract, read it thoroughly. The disclosures on the front or the back of the contract may tell you the office or person to contact if you plan to cancel your policy. If your contract is not clear, contact the insurance company directly. You may be asked to contact the finance manager at your dealership if you purchased your vehicle at one.

In either case, you will be given a cancellation form that must be completed in full and signed, stating that you wish to stop gap coverage. Before completing this form, think about your situation. If you still have an outstanding balance on your auto loan and are considering stopping your gap insurance, be sure to think twice about your choice. Gap insurance provides great protection in the event your car is declared a total loss by an insurance company after an accident. Gap insurance will pay the difference between what is owed on your loan and the fair market value of the vehicle at the time of the accident. On certain imported vehicles and heavy-duty trucks, this can amount to thousands of dollars of protection for a relatively low price. If you are selling or trading in your vehicle, it makes sense to cancel gap coverage, but if you have a loan balance that is greater than the trade-in/wholesale value of your vehicle, it is recommended that you keep gap coverage until the balance is lower or the loan is paid off altogether.

Get Free Car Insurance Quotes >>

Collecting Your Refund

After submitting your cancellation form, check your contract once more. In many cases you will be due a pro-rated refund from the insurance company based on the length of time that you kept your policy. If you have any questions regarding a refund, it's best to contact the administrators directly, as the dealership finance manager may not know the specifics of the insurance company's policy. If you are due a refund, give the insurance company up to a few months to process the refund. If you don't receive the refund within a reasonable time frame, contact the insurer to confirm the policy is canceled, as you may find that your paperwork was mysteriously "lost" because you were trying to cancel a contract that was very profitable to the insurance company or the dealership.

In any case, it is very easy to stop gap car insurance as long as you are patient and take the time to read your contract in full. Determine your responsibilities and obligations in cancelling the coverage. As with any insurance policy, be sure to consider the risks and benefits of cancelling your policy before doing so.

Get Free Car Insurance Quotes >>

Related Questions and Answers

What is Gap Insurance Used For?

If you find yourself in an upside down loan, where you owe more than the value of the car you've bought, your loan company may require you to obtain what is called GAP insurance. Regular comprehensive and collision policies will only pay out the value of the vehicle upon total loss. If this is the only coverage you have, your loan provider may end up losing money on the loan if a total loss occurs in the first few months of the loan. Gap insurance provides for the gap between what is owed and what the car is worth in this time frame.