State Farm Auto Insurance Practice Test

What happens when a customer moves from one state to another regarding their policy?

1. The customer must cancel the policy immediately

2. The policy remains unchanged regardless of the state

3. Differences in the policy may occur due to state-specific regulations

4. The customer can transfer coverage without adjustments

The correct answer is: Differences in the policy may occur due to state-specific regulations

When a customer moves from one state to another, differences in the policy may occur due to state-specific regulations. Each state has its own laws and regulations regarding auto insurance, which can affect coverage requirements, minimum liability limits, and available discounts. Therefore, after a move, it's essential for the customer to review their policy to ensure it complies with the new state's regulations. This review may involve updating the policy to meet the new state's legal requirements, which can include adjustments to coverage limits or adding specific endorsements. It's also possible that the new state may offer different insurance options or benefits that the customer may want to explore. Therefore, while the customer does not have to cancel their policy immediately, they need to be proactive in assessing how their move impacts their coverage under the laws of the new state.