One of the most common queries during the COVID-19 pandemic is ‘should I cancel my car insurance?’, ‘can I cancel my car insurance’ so on and so forth.
You can cancel your car insurance due to a variety of reasons. The most common and acceptable reason for cancellation is the inability to pay the premium on time. After the onset of the COVID-19 pandemic, many car insurance companies have rolled out options to help car owners. The car insurance companies have provided an extension in the grace period for premium payments, new payment plans, and providing alternatives on cancellations. If you feel that you need to cancel your car insurance get in touch with your car insurance company or the agent from that car insurance company.
There are also instances where car insurance companies cancel the insurance from their end. Car insurance companies cannot go around canceling policies for reason. The car insurance companies will have to adhere to the state laws when they are in the process of canceling insurance policies. Some states allow car insurance companies to cancel policies within the first two months for any reason.
Rest assured car insurance companies only take the step of canceling coverage during a term if there is a violation of the terms of the insurance agreement.
Common reasons for the cancellation of your car insurance:
- Failure to pay your premium is a breach of contract. If you fail to pay your premium the car insurance company will cancel your policy in a heartbeat.
- You have far too many at-fault accidents or traffic violations. Too many accidents and traffic violations with a certain timeframe (varies from company to company) can result in the cancellation of your car insurance.
- If you fail to provide the right information in your car insurance application, it can result in cancelation. To give you a car insurance quote and final rate, car insurance companies require your correct information. Failing to provide the right info will result in policy cancelation.
- If you have your license and registration canceled it can result in the cancelation of your car insurance.
- Wrongful claims are also another reason why your car insurance can be canceled.
- Health conditions like epilepsy and heart attacks can require a certificate from a physician testifying to your ability to drive safely. If you fail to provide the necessary certificate, your car insurance policy will stand canceled.
- Commit a felony, like driving under the influence, your policy can be canceled.
- Car isn’t safe to drive or if it has mechanical problems to the point it endangers public safety, your policy could be canceled.
- Use your car as a taxi or for Uber or Lyft and don’t inform your insurer.
- If you decide to cancel your car insurance due to any reason, you are entitled to a complete refund of the remaining premium. Depending on how long you have been insured, there will be a deduction. If the time period of your insurance is short then you will get most of your premium as a refund. It is advisable to closely read the policy before you cancel yours.
Can car insurance companies refuse renewal?
If you have too many traffic violations like traffic tickets, DUI, etc, your car insurance company can refuse the renewal of your policy. If you have a poor credit score, that also can swing the company towards the decision of non-renewal of your policy. Car insurance companies use many factors to decide how much risk there is in offering you coverage. If they determine that you are high risk, they can either cancel or refuse to renew your policy.
It is a fact that many car insurance companies don’t have to inform you of the reason. In most states, they do have to give you notice that your policy will not be renewed.
Are there any consequences for canceling my car insurance?
If your car insurance cancelation is due to the result of non-payment, your credit score can take a significant hit. A lower credit score can make it difficult for you to get any services that require a credit check. Having a policy cancellation in your record can cause you a higher fee for a new policy. A lapse in coverage following a cancellation can result in fees and result in future rate hikes.
If your car insurance policy is canceled, the car insurance company will notify the motor vehicles department. Some states require car insurance to be in place for the entire duration of a car’s registration period.
Meet Xavier Sabastian, the auto insurance expert who deftly maneuvers through the intricate landscape of insurance policies. In his quest for the perfect car review, Xavier is forever trying to seamlessly blend expertise and enthusiasm into each assessment. Like Behrman in “The Last Leaf,” he dedicates his downtime to discovering the perfect theme for his dream novel.