When, How and Why Auto Insurance Takes Effect

When, How and Why Auto Insurance Takes Effect

Unless you keep the same car covered by the same insurance company for an extended period of time, you will be faced with questions surrounding your auto insurance coverage. How much coverage should you carry? Should you purchase uninsured motorist insurance and should you just carry liability or comprehensive coverage? To prevent any gaps in coverage, you will also want to know your automobile insurance is in place when you take delivery of your new vehicle.

So when, how and why does auto insurance take effect? Here are some common questions and answers.

Can I get auto insurance that is predated?

No. Predating insurance prior to its actual activation is illegal. This is why you need to keep coverage in force. You simply can’t wait until you are involved in an accident or need proof of insurance to acquire it.

Can I get auto insurance coverage immediately?

Yes. While auto insurance can’t be predated, coverage can take effect immediately after application and initial payment.

Can I schedule auto insurance coverage to start at some future date and time?

Yes. If you are planning to take possession of a vehicle in the near future, you can schedule coverage to take effect up to 30 days in advance. Of course, you will need to provide your information and the vehicle details including the VIN number.

Do I have to pay a premium for auto insurance to go into effect?

Yes. Your initial premium serves as a binder that locks in coverage at the time of payment, or within 30 days of the initial payment if you are purchasing it in advance.

If I am switching auto insurance providers, what do I need to know about canceling my previous auto insurance?

There are several factors to consider. Most auto insurance policies are in effect for six months. While most insurance companies will cancel a policy at any time and refund any unused premiums, some may require a pre-specified notice. Some high-risk still use what are called “unearned premiums” This is a predetermined amount of money that is owed the insurance company upon initial sign up. Some companies could have as much as a 3-month earned premium. This means that even if you cancel the policy one day after it was started, you would owe 3 months of earned premium regardless. Typically, after that 3 month period, the rest would be refunded back without any penalty.

Should I shop around for auto insurance?

Absolutely. When you buy a vehicle, it can seem easier to just roll over coverage to your current company. This can be costly, however. Our independent insurance agents can do the shopping for you. They have access to a variety of companies and, armed with your basic information, can do the comparisons. You have the final choice of your insurance company.

If you anticipate purchasing a vehicle, take appropriate steps to prevent any gaps or lapses in coverage. Knowing how, when and why coverage takes effect can help.


Do you have questions about your insurance? Find an insurance agent near you with our Agent Finder

Buzz Your
Insurance Agent

Search for a local agent with our agent finder map.

Agent Finder

Search All Blogs

Generic filters
Exact matches only
Search in title
Search in content
Search in excerpt

Buzz Your
Insurance Agent

Search for a local agent with our agent finder map.

Agent Finder

Want to learn more about our blog writer?

Read more about KayLynn's background.

Click Here

Search All Blogs

Generic filters
Exact matches only
Search in title
Search in content
Search in excerpt

Non-Profits Need Protection Too! Safeguarding Your Good Works with Insurance

Non-Profits and Insurance: Myths Busted! Protecting Your Good Works

Beyond the Grave: Burial Insurance vs. Life Insurance Explained

Don’t Be Buried by Confusion: Understanding Burial and Life Insurance

Cracking the Code: Your Car’s VIN and What It Means to You

VIN Decoder Ring: Unveiling the Mysteries of Your Car’s Identification Number

The Aftermath: Proving Your Possessions After a Disaster

Homeowner’s Insurance Hero: How to Prepare for a Claim Before Disaster Strikes

Lost in Translation: Skills of the Past That Young People Might Miss Out On

From Fax Machines to Fancy Footwork: 6 Skills Younger Generations Might Not Have

Beyond the Box Truck: When Does Your Business Need Special Vehicle Insurance?

Business on the Move? Don’t Get Stuck Without the Right Vehicle Insurance

From Bronze Age to Boomers: How Life Expectancy Went From Meh to Magnificent

How Long Will You Live? A Look at Life Expectancy Throughout History (and Why You Might Need Life Insurance)

From Chauffeur to Cheerleader: The Teen Driver’s (and Parent’s!) Guide to Car-Buying Chaos

Teen Driver on the Horizon? This Guide Will Steer You Through Car-Buying Chaos

When Branches Become Brawls: Who Pays When a Tree Attacks Your House?

Neighborly Nightmare: Tree Trouble and Your Homeowner’s Insurance

From Pet Rocks to Pokémania: A Funtastic Journey Through 50 Years of Fads

A Look Back, and a Look Forward