Canceling your car insurance and changing companies doesn’t have to be a hassle and if you go about it the right way, you could end up saving money.
Here’s how you can make the cancellation process as smooth as possible.
What to consider before canceling
Doing a little forward planing before you contact your insurance company to cancel can really help things going smoothly and help you steer clear of any costs or penalties.
Can I cancel my car insurance at any time?
Most insurance companies allow customers to cancel their policies at any time for any reason. However, there’s still a possibility that you may be subject to cancellation fees.
While you’re free to call up your agent and cancel whenever you want to, there are two smart times to end a policy: before your renewal date and before your next monthly payment is due.
Switching car insurance companies
You must have a new policy in place before ending the one you currently have. Any gap in coverage can impact you negatively. Even if you’re without coverage for a day, you might have to pay some hefty fines, have trouble obtaining insurance in the future, and even have your driver’s license and vehicle registration suspended.
Most insurance companies will ask for proof that you have coverage elsewhere before processing your cancellation request.
Reasons for canceling your policy
Switching insurance companies isn’t the only reason why people cancel their car insurance. There are plenty of valid reasons and it’s best to think about yours beforehand because the agent will most likely ask you to provide one.
These are the most common reasons why people cancel:
- Purchasing a new car
- Selling your vehicle
- No longer planning on driving your car
- Found a better deal while shopping around mid-policy
- Unhappy with current insurance rates and are sure you can find cheaper rates elsewhere
- Moving to an area where the insurance company doesn’t provide coverage
- Life change
- Dissatisfaction with your current insurer’s customer service
How to cancel car insurance
Every insurance company has a different process when it comes to canceling policies. Sometimes it’s as easy as a phone call and other times you’ll need to submit a formal cancellation letter.
If you’ve weighed your options and are still set on canceling your insurance policy, here’s a list of recommended steps to follow to make sure the process goes smoothly.
Check your insurer’s website
Every insurance company has a different cancellation policy, so make sure you check the website for details.
Contact your agent
Your agent’s contact information can be found on your insurer’s website and on a copy of your policy that was mailed to you.
If you don’t remember who your agent is, you can always call the main helpline and somebody will direct you to your agent or another one.
Have your information ready
As obvious as it is, make sure you have all your information in front of you before you cancel your policy.
Knowing things like your account number will make the process a little easier.
Reason for canceling
If your reason for canceling has to do with finding a better deal, let your agent know this.
They may offer you discounts or other incentives to persuade you to stay.
Ask about a cancellation fee
Check whether you have to pay a cancellation fee.
For the most part, you won’t have to pay the fee as long as you give an appropriate notice, which is usually 30 days.
Ask about a refund
Most insurance companies will refund any part of your premium that’s unused.
Written request
It’s likely that the insurer may ask for a written request of the cancellation, so be prepared to do so when asked. If that happens, it’s either by a letter or email.
Cancellation confirmation
It’s easy to forget to ask for confirmation of the cancellation. Make sure to request this in case anything goes wrong during the processing of the cancellation.
Who to contact after
Once you’ve finished with the insurance company, you will still have to contact the following:
- Lienholder – If you’re still making payments on your car, sometimes it’s necessary to maintain certain kinds of coverage on your vehicle, such as comprehensive and collision
- Financial institution – Ensure that you stop any future scheduled automatic payments
- Your state’s DMV – You should always contact your state’s motor vehicle department. Depending on where you live, you might have to inform them of the cancellation and even have to turn in your car’s license plates and registration tags
Finding a better rate and policy for you
Switching insurance companies is the perfect time to reassess what you need in a policy, such as the different types of coverages. Use this time to find out if you’re getting the best rate that you can. Finding the right insurance for you doesn’t have to be confusing or complicated so just let the Cover app do all the work for you.
Cover
will get you an auto quote in as little as five minutes.
All you have to do is answer a few short questions.
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If you are looking for a specific insurance provider, you can read about their cancellation process here:
