Can I cancel my car insurance at any time?’ is one of the most commonly asked questions especially when nearing the date of renewal. The answer to this question is yes. You may otherwise pay a cancellation fees or forfeiting your right to refund any payments paid in advance. However, it would help to study your car insurance company’s specific cancellation policy to understand all of the nuances.
Things to Know When Canceling a Car Insurance Policy
When canceling your car insurance policy, take into account the following factors:
- Cancellation fees: Some auto insurance companies levy a $50 cancellation fee. In some situations, they may charge you a small percentage of your last premium, which you would have paid in the future. There is no cancellation fee in the vast majority of cases.
- Letter of cancellation: You may be required to send a formal letter of cancellation. If that’s the case, you’ll need to contact your insurance carrier to find out where you can fax it.
- Notice period: Some insurance companies need a 30-day notice period before canceling your policy.
To ensure that the cancellation procedure works smoothly, verify your policy for all of these clauses before canceling.
Making a Car Insurance Cancellation
Some of the measures you’ll want to take to cancel your vehicle insurance are as follows:
- Get in touch over the phone: Call the customer support number listed on your insurance policy during business hours. You’ll want to set a deadline for canceling your coverage. Car insurance companies will sometimes want to keep your business by providing discounts or other incentives.
- Get the facts: You will be guided through the canceling process by a customer service professional. You must understand the canceling process completely, so ask as many questions as you need.
- Complete paperwork: Your insurance company may give you paperwork to fill out to cancel your policy. The information will usually be filled out for you. You’ll need to go over it carefully to look for errors and sign all relevant spots.
- Provide proof of new insurance: If you switch to a new insurer before canceling your previous policy, you may be required to send documentation of your new coverage to your old insurance carrier. In most circumstances, your new insurance ID card will suffice as proof. Would you mind making sure the information on your card is correct by double-checking it?
- Check to see whether you’re eligible for a refund: If you paid a portion of your premium in advance and then canceled your plan before it was due, you’re normally entitled to a refund.
- Get the notification: When your insurance plan has been officially canceled, you will receive notification from your insurance provider.
I Canceled My Car Insurance, Now What?
You can call and cancel your coverage in the best-case situation, and your prepaid premiums will be refunded in full. Your policy may stay active for another 15 to 30 days or until the next payment is due at other periods. It’s not always easy to terminate your insurance policy. It all relies on your insurance company’s specific cancellation policies.
When I Cancel My Policy, Will I Receive a Refund?
There can be a refund based on your coverage and the company. It all relies on the specifics of your contract. You could, for example, pay for six months’ worth of auto insurance at once. You may be eligible for a refund if you terminate your plan before the six-month period has passed.
Did you cancel your plan right in the middle of the month? You might be eligible for a refund. For instance, if you canceled your plan on January 20 and had already paid premiums for the entire month of January, you may be eligible for a refund for the days from January 20 through January 31.
If you cancel your payment during the ‘grace period,’ you may not receive a refund in some situations. This is the period after a payment is due during which you are still insured, even if you do not make the payment on time. These can last anywhere from seven to ten days until your insurance terminates your policy. You cannot get any money back if you cancel during a grace period. Again, it all relies on the policy’s specifics.
It’s critical to be aware of your cancellation policies.
What Happens If I Don’t Notify My Insurance Company?
If you fail to notify your insurer of your decision to terminate your insurance and stop paying your premiums, they will continue to send you bills. The maximum number of months you can be late varies by the plan. Consequently, there will be deactivation after some inactivity. That may appear innocuous, but it might leave a negative impact on your credit report. Insurers will view this as a red flag and charge you higher rates if you apply for insurance again.
What Are the Best Times to Cancel Your Car Insurance?
Driving without auto insurance not a great choice to make. So, the only time you should cancel your plan is when switching to a new insurance plan. It is best have a minimum insurance coverage even if you don’t own a car. This will be beneficial if you are someone who borrows and drives occasionally. Make sure you compare quotes using tools like the Way app to understand the rates and choose the provider that works best for you.
Sara Sam may not look like your typical car and finance expert, but don’t let that fool you. With over four years of experience in the industry, she knows all the ins and outs of cars, car insurance, and refinancing. You can trust Sara to help you navigate the often-confusing world of automobiles and financing.
