Can you switch car insurance companies when you have an open claim?

• You can switch auto insurance companies with an open claim 
• An open at-fault claim will still affect your rates at your new auto insurance company
• Your old company will still handle your open claim if you switch companies

You don’t need to settle your open claim to switch insurance companies. Your current insurer is still obligated to handle your claim, even if you switch to a new insurance company before you resolve your open claim.

However, you must be honest with your new insurance company about your open claim. Even the best insurance companies may drop you if it is found out that you lied about an insurance claim, as at-fault claims affect rates.

Read on to learn more about changing car insurance with an open claim, from how an open claim affects your insurance rates to avoiding an insurance lapse. 

What happens when drivers switch insurance companies with open claims?

Switching insurance companies won’t affect whether or not your claim gets accepted by your current company. Your insurer will base its decision on factors like fault, your coverages, and other details. 

However, when getting new car insurance, let your new company know about your open claim. Not telling an insurance company about previous claims can be considered insurance fraud, invalidating your car insurance and resulting in you getting dropped by your new insurance company. 

Once your claim gets settled with your old insurance company, you don’t need to worry about communicating with your old insurance company about your claim unless you wish to contest the claim outcome.

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Why Drivers Switch Insurance Companies With Open Claims 

There are multiple reasons why a driver may switch companies while dealing with an open claim. For example, drivers often get insurance quotes online to see if another company offers cheaper rates with an open claim and then switch to the cheaper company.

Some of the most common reasons for switching insurance include: 

• Dissatisfaction with the claims process. If a customer has a poor claim filing experience and believes it is taking too long, they may want to switch to a better company. 
• Found a company with cheaper rates. If an open claim raises rates upon approval, such as for an at-fault accident, some drivers may look for a cheaper company while their claim gets processed.
• Moving to an area their current insurer doesn’t service. Suppose a driver moves outside an insurance company’s service area and can’t wait until their claim is processed to find a new insurance company. In that case, they may switch before claim finalization.

These are some common reasons drivers may switch insurance companies during an open claim, though it can be more of a hassle than waiting until the claim gets handled to switch insurance companies.

It’s important to note that you can’t switch insurance companies because you want the new insurance company to handle your current claim. You can’t switch claims between insurance companies, and trying to file with both insurance companies counts as fraud.

Will an open claim affect insurance rates when switching? 

Yes, an open claim can affect your new insurance rates when switching car insurance, as claims are one of the factors that insurance companies use to calculate insurance rates. However, if your claim is for an accident that wasn’t your fault, it likely won’t affect your insurance rates. 

However, if your open claim is for damages from an at-fault accident, expect it to be a factor when your new insurance company calculates your rates. Since you’re considered a riskier driver, at-fault accidents on your record will impact your rates. 

How do you avoid an insurance lapse when switching?

Regardless of whether or not you have an open claim, it’s vital to avoid a coverage lapse when you change auto insurance companies. Knowing how to switch car insurance without coverage lapses is important. Any lapses can raise your rates at your new insurer since driving without insurance is illegal.

Check your cancellation date to ensure it doesn’t take effect before your new policy starts. Your current company may even ask for your new insurer’s information before you can cancel your policy to ensure you don’t lapse in coverage.

The Final Word on Switching Insurance Companies With an Open Claim 

You can switch your insurance company with an open claim, but you must be honest and inform the company of your open claim. You also need to arrange your cancellation and start dates, so you don’t end up with an illegal lapse in insurance coverage.

If you’re dissatisfied with your insurance company and how it handle claims, shopping around and comparing rates and reviews can help you find a better one. 

Use our free quote comparison tool to shop and compare insurance rates from companies in your area. You can also look through ratings from the Better Business Bureau or J.D. Power’s insurance studies.

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