Chelsey Tucker graduated with a Bachelor of History degree from Metropolitan State University in 2019. She now writes about insurance with her specialty being life insurance and has been quoted on Help Smart Phone and MEL Magazine.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years. He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com.

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Mar 19, 2020

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The lowdown...

  • There are no restrictions that can be imposed by the auto insurance company on when you are allowed to cancel your car insurance coverage
  • If you cancel your car insurance coverage and still have a vehicle legally registered in your name, then it is your duty to pick up some other form of auto insurance coverage that complies with state law
  • Every insurance company has a different procedure for how you can go about canceling your policy
  • If you have already paid a premium for your policy, you will get a refund based on the total number of days that you paid for and the days that remain unused so far
  • There may be a fee written in your policy in the event that you choose to cancel your policy, which would be deducted from whatever refund that you are entitled to receive from the insurer

Even if you have only had your car insurance coverage for a very short period of time, there could be legitimate reasons why you would want to cancel it.

If you are the one canceling your auto insurance, then you are in the driver’s seat much more so than if you receive a notice of cancellation from your auto insurance provider.

The thing you need to take care of before canceling your coverage is to get the next option for your car insurance coverage already in place first. Use our free comparison tool today to find the right coverage for the right price.

Contacting Your Auto Insurance Company to Cancel Your Coverage

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No matter how new your policy is, you can always call your auto insurance provider to find out how you can go about canceling your coverage.

There will be different requirements for each auto insurance company, so you should not assume that you have taken care of everything just by making a call.

You may also be required to provide written and signed forms to make the cancellation official. The only way for you to know this is to read the terms of your own policy or to call your auto insurance provider.

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Avoiding a Fee for Cancellation and Receiving a Refund

For many auto insurance companies, there is a 14-day grace period after you sign up for a new policy during which you can decide whether you want to cancel your policy.

Typically, if you cancel within this short window, you will not be responsible for paying any type of cancellation fee.

The best way to know what grace period you have in which you can cancel your policy without having any cancellation fee applied is to read the terms of your actual policy. The insurance provider will be required to disclose any fees applicable to you within the policy itself.

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If you cancel in enough time to avoid paying a fee, then you should expect a refund of your premium. Even if you happen to cancel outside of this grace period, then you will still be entitled to receive a refund of your unused premium amount.

For example, if you paid a premium for one month of coverage and you cancel after 14 days, then you should receive a pro-rated share of your premium back for the remaining 16 days of that particular month.

Your auto insurance company may have specific requirements in order for you to receive the refund. For instance, you may have to sign a form instead of simply canceling over the phone.

Your policy agreement may explain exactly the terms by which your refund is distributed in the event of an early cancellation.

Why You Should Consider Canceling Your Current Coverage

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Car insurance is a requirement if you are going to drive a car or register a vehicle under your name, but there is no requirement that you have to stay with the same company to finish out a policy term.

You have the right to choose the insurance provider that works best for you, and you can make this change at any time in the middle of a policy term.

The best reason to make a change is if you can find the same type and amount of coverage at a much better rate.

If you are curious about whether there are better options out there for you, the best way to know for sure is to fill out a request form for quotes on car insurance rates online.

This process is fast and easy and gets you started with all the information you need to evaluate whether you should stick with your current provider or try out another one.

Another reason why you may want to cancel a policy early is if you have any issues with the coverage provided by your current auto insurer.

If you run into a problem very early on after signing up for a new policy, this may be a red flag for you that you should seek out a better provider.

This is a good opportunity to remember that there is much more than just getting the lowest available price that goes into choosing the best auto insurance company for you.

If you have to make a change to your policy, such as removing a car, this does not mean that you have to cancel your coverage altogether.

Instead, you can simply tell your insurer that you need to remove a car or a listed driver on your policy and update it with new information. This may change the rate that you pay, but you do not have to scrap your entire policy in order to make these changes.

You Always Have the Option to Cancel

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You always have the option of canceling your auto insurance coverage if that decision makes the most sense for you.

In order to make sure that you comply with all of the insurance company’s requirements with respect to canceling a policy, be sure to consult your actual policy agreement, which is like a contract between you and the auto insurance company.

In addition, you can also call the auto insurance company to see if there is anything else you should be aware of for canceling your policy.

After that, you need to make sure that you get a refund of the remaining part of your premium and find out if there is any cancellation fee associated with your request.

If there is, then that fee will come out of the amount of the refund you would receive for your unused premium.

Make sure to have new coverage in place before canceling what you already have. Compare car insurance quotes today and see how much you could save.