How to switch insurance to a new car

Nowadays, a car is a commodity most people cannot live without, and there will come a time when you need to upgrade your old banger for a new set of wheels. Buying a new car is generally an exciting prospect when you are comparing the new shiny paintwork on the outside and the new safety systems and gadgets on the inside to your old used motor. However, once you have made your decision and completed the purchase there are some more mundane, administrative things you must do. One such thing is how to switch insurance to new car. 

In Spain, car insurance is provided for the actual car, not the person, so making the switch to cover a new car is vital. This means the process may be slightly different to what you would normally do in other countries. Therefore, you need to know the ins and outs of how to switch insurance to new car to ensure your new one is covered to the hilt and that it, and your wallet, is well protected in case you need to make a claim. 

What I mean is, it will not just be a case of switching like for like, as depending on the age and market value of your previous car, you will most likely need to upgrade the level of cover you have. For example, if you have previously owned an older vehicle, you may have chosen a basic Third-Party insurance policy, as the market value will have been low, and it would not have been worth paying high premiums to cover it.  However, with a new all singing and dancing car, you will want a Fully Comprehensive, (or All Risk) policy to cover it, as this will also protect against damage to your vehicle and ensure you don’t risk losing your car, and your hard-earned money, in the event of a total loss incident. After-all, new cars don’t come cheap, and they are a significant investment that you want to protect at all costs.

Obviously, this inevitably means that you will end up paying more per annum for your car insurance, as you will want higher protection for the higher value asset you have to cover. Therefore, it is worth shopping around to find the right insurance policy and protection for a competitive price. 

So, how to switch insurance to new car?

Know your stuff 

Before you start looking for quotes or checking out price comparison services it is essential to know what type of cover you are looking for. As I mentioned above, you can choose from a range of policy levels to cover your vehicle, from Third-party (responsabilidad civil obligatoria or seguro obligatorio), Extended Third party (responsabilidad civil obligatoria, incendio y robo) to Fully comprehensive (todo riesgo). For more information on levels of car insurance policies, you can check my previous blog article, or you can also see a useful chart including an example of the list of benefits you may find within each policy level here. 

Administrative tasks

There are a number of administrative steps you need to make to be able to obtain quotes for a new policy and to do the switch correctly. 

1. Check the cancellation or transferal policies of your current insurer

   Each insurance company will have their own terms and conditions, so you need to check the small print regarding cancelling the policy mid-term. Reputable insurance companies will usually allow customers to cancel mid contract with up to a couple of months’ notice, although it is unlikely you will receive a refund for payments made upfront. If you have paid for an annual policy up front and have a considerable amount of time left, it is worth speaking to the current insurer to see if you can transfer a proportion of the annual amount paid for your current car against a new policy with them for your new car, but again this is dependent on each insurer and their cancellation policies.

2. Check your no claims status and get formal proof/certificate

   As in many countries, Spanish insurers also have a no-claims bonus system for policy holders who do not file any claims. This helps to reduce insurance premiums year-on-year. Again, as with the T&C´s, each provider will have its own specific no-claims system, but you can carry over no-claims status when switching providers if you have proof of your no-claims history. You will need to request a copy of this from your current insurer in the form of a no claims certificate or letter of no-claims confirmation.

   It is also worth pointing out to expats that Spanish insurers may also accept the no-claims status you have earned in your home country, particularly countries within the EU, so it is also worth checking this if you are coming from abroad and need to switch your current insurance policy for a new car and policy in Spain.

3. Get a range of quotes from different insurance

   First of all, contact your current provider and ask them to quote for a new policy based on the details your new car and its market value. Remember to ask about the cancellation or transferal policy for your current policy as well as the key benefits that will be included in the new policy such as:

   • Policy coverage – what exactly does the policy cover you for?

   • Mandatory or voluntary excess – how much do you have to pay, or volunteer to pay in the case of a claim?

   • No claims bonus and protection – what level do you currently have, what discounts does it give, and can you protect this level if you make a claim?

   • Also ask about any additional benefits of the policy such as:

     • Courtesy car

     • Roadside or breakdown assistance

     • Accident assistance

     • Legal expenses cover

     • Personal injury cover

   Once you have this information, you can use it as a benchmark to compare against quotes from other insurance providers.

   Looking at the policies of other companies is not only about comparing the prices, but it will also open your eyes to additional coverage and benefits that you may not already be aware of. For example, Caser Expat Insurance includes accident assistance called Autohelp, which is a new, extremely valuable benefit, in all their car insurance policies. This service enables you to be automatically connected to the emergency services in the case of an accident. They also provide customer service assistance in English, which again, is extremely beneficial to expats who may feel overwhelmed when doing bureaucratic tasks and confirming contracts if they have to try to do it all in Spanish. 
   

   Additional benefits such as these may seem small in the bigger scheme of things, but it is simple things like this which may help to sway your decision on which provider is most suitable for your needs, so definitely spend time doing your research and making full comparisons before you make a final decision on which provider to go for. Caser Expat Insurance makes everything easy giving you a quick quote for your insurance here.

4. To switch insurance for your new car to a new insurance provider, you must formally cancel your current policy with your current provider.

   Insurance policies in Spain automatically renew after the contract period ends, so even if your current policy is coming to a close, if you don’t inform them you may end up paying for it again and essentially be covered on your old car and your new car at the same time. (As I mentioned before, in Spain, it is the car, not the person who is insured, so having 2 or more policies (for 2 or more cars) is not only possible but common, for example, families may have a number of different policies to cover the different cars each of them drive, so this type of duplicate insurance is not flagged by insurers and is your responsibility to check against.

   You may need to write a formal letter or email to confirm you want to cancel the policy, or you may be able to cancel your policy online. However, I would always recommend speaking directly to the customer services department of your current insurance provider to check their specific cancellation process. This gives you the peace of mind that you know you have the full details to do the cancellation correctly and that you also won´t be hit with any hidden penalty costs that you were not aware of.

So, in a nutshell, although you may hate even the idea of having to do this type of life admin it really is worth setting aside some time to go through this process in order to most successfully switch insurance to a new car. See it as an extension of the car buying process – you chose the car for its shiny paintwork, safety systems and gadgets – and so you should do the same when choosing from the insurance policy benefits that will protect it! 

Happy hunting and safe travels!