This topic comes up quite often when I'm setting the effective date for my client's new home or auto policy. I'll ask my client what day they'd like to start coverage. Sometimes he or she will request starting coverage on a Friday and mention that they will just cancel their other insurer after the weekend. This is when I make it a point to explain why anything but seamless coverage is a very bad idea.
Seamless is important. In most cases you don't want redundant coverage and you certainly don't want to drive uninsured, not even for a day. As an insurance agent, I live the exciting insurance world everyday. This can be a world of mystery, drama, unfortunate exceptions, events and timing. The mystery is why people always forget that accidents and unfortunate events are unplanned and fail to make any contingency plan to protect themselves. I've seen people who've had serious collisions on just a minimal lapse in coverage.
I witnessed a good friend of mine in college who was left to pay for her new car's extensive repair bill and the other party's, since she was at fault and uninsured. The insurance on her car lapsed while she was overseas on a long vacation and she crashed on day one of her return. In addition to paying several thousand dollars for the bodywork on the two late model cars, she also had a sizable ticket for driving while uninsured and the very steep impound and towing fees.
As with any rule, however, there are a couple of exceptions that come to mind where redundant coverage can still be a good thing.
The first is life insurance. I, myself have life insurance from more than one carrier. There is no concern with redundant coverage from competing life insurers. They will pay out if you pay the premium and die.
The next partial exception to this redundancy rule is an umbrella policy. No, you shouldn't have more than one umbrella policy at a time. Umbrella coverage offers additional liability and could, by it's own nature be considered redundant for that reason. Umbrella coverage can also be provided from a different carrier than your underlying coverage.
When an insurance company pays a claim, there are many people and variable factors at play that determine how much the carrier will pay out. So, if you were to add another company to cover the same house or car there would be many needless extra layers of added complexity. This would involve not only figuring out what one is entitled to from the contract language and adjuster, but also what percentage of the claim they are responsible for when another carrier is mixed into the equation. If the coverage amounts are different from each other, you could end up even getting less in your claim than what you would otherwise be entitled to. The result of this mess has in the past lead to carriers arguing what percentage and amount they are obligated to pay to their client. In addition to the aforementioned, you would experience longer delays in the claims process.
My suggestion is always to just keep it simple and communicate your intentions to both insurers so that you will have seamless, non-overlapping coverage. Let the new agent know the effective date of your new policy and the previous agent know when your new coverage will start. It's also generally a good idea to get payment information taken care of ahead of the effective (or start) date to avoid any last minute issues.