This episode is about a little trick you can do if you are planning on selling your car and canceling your insurance. If you do this and will be purchasing auto insurance in the future, you will be losing an important discount (for lack of a better term) called “prior insurance”

Prior insurance is a rating factor that is used when you are getting quoted for an auto insurance policy. If you have no lapse in your coverage, you will be welcomed by a preferred insurance company and pay lower premiums.

Let’s say you have a lapse in your coverage. You will have to go to a non-preferred company and pay more premium for 6 months before being eligible for a preferred company. If you are intentionally canceling your insurance policy because you are moving overseas, going on a mission of sorts, or traveling for an extended period of time, you can purchase a “non-owner auto policy”

This is an insurance policy you buy when you have no vehicle. It is used if you need to drive for work but have to borrow a car for example. Or if you have to carry an SR-22.

You can purchase one of these for a fraction of the cost of a traditional auto policy, just so that you can keep insurance place. When you return and get a quote on your new auto policy, it will show that you have no lapse in coverage and be eligible in a preferred company saving you $$.

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Music by Roger Clyne and the Peacemakers

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