There are three things to know about car insurance cancellation policies. Car insurance policies allow for car insurance cancellation under most circumstances with certain conditions. Car insurance policy cancellation can take place during the life of the car insurance policy at any point before its renewal date.
Three things to know about car insurance cancellation policies and car insurance is why cancel, when to cancel and how to cancel.
Why you should cancel your insurance policy
Reasons for car insurance cancellation are varied. Sometimes, better car insurance deals become apparent or available. In today's challenging economy, people save any way they can.
Other times people may be moving to another state or locale and need to renegotiate car insurance policies and coverage. Perhaps medical conditions or sudden changes in car insurance needs make car insurance cancellation necessary.
Perhaps the car insurance policy coverage or service has proven unsatisfactory. Maybe an online company, other agent or company provided better quotes. Maybe the vehicle is no longer operable.
Car insurance cancellation of a car insurance policy is common when selling a car. Often the policy will have unearned premiums.
When to cancel your insurance policy
Be sure to have appropriate coverage in place when you cancel auto insurance policies. Timing policies to maximize the unearned premiums, or the down payments that by law must be returned, along with new coverage adjustments can be financially wise.
Know the details of car insurance cancellation before canceling car insurance. Despite possible penalties and fees, most car insurance companies will refund the unearned premiums or any advance payments.
Many people contact the car insurance companies to determine exact car insurance cancelation policies.
Most car insurance cancellation decisions can be made within two weeks of purchasing the car insurance policy. This is the "cooling off period" during which transactions are reversible.
Car insurance cancellation policies generally refund all charges during this period. Premiums should be pro-rated in the event of car insurance cancellation before 14 days.
How to cancel your insurance policy
Car insurance cancellations vary from company to company.
Check for car insurance policy cancellation fees. Many insurance companies charge fees for canceling early.
Put it in writing or call your car insurance provider. They're not psychics, so don't just stop paying premiums. Car insurance companies have different car insurance cancellation policies. Follow their procedures.
You may have to report changes to the state department of motor vehicles. Be sure to keep records of the policy so it can be identified properly.
Without proper communication, some insurers may report drivers as uninsured causing possible problems in accidents or legal situations.
Lastly, never cancel while in the midst of a claims action. That will complicate settlements or negotiations.