How do I cancel my car insurance?
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UPDATED: Mar 19, 2020
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- Canceling your car insurance is an easy process
- Make sure your new policy is in full force before canceling to avoid any gap in coverage
- Notify your old policy agent that you wish to cancel
- Pay any remaining fees due to your old company and ask for a refund on any unused premiums
Occasionally, you may find yourself in a situation in which you need to cancel your car insurance. People need to cancel their current car insurance coverage for a variety of reasons, including changing their policy or insurance company, dissatisfaction with their current service, or moving to a new state.
Have you found yourself in any of these situations? If so, use our FREE comparison tool to start the process!
What is the best way to cancel my policy?
The best way to go about canceling your current insurance coverage is to contact the company that you currently have a policy with and tell them of your intentions to withdraw.
They will ask you why you wish to cancel your current policy and will likely try to sell you on other plans. Just remain firm in your resolve to withdraw from their policy, if that is what you have decided to do.
While your current insurance company may try to sell you on keeping your current policy, they are required by law to inform you about replacement insurance.
They will usually state that you should never drop your current insurance policy until such time that you have received a formal copy of your new auto insurance policy in hand.
As insurance agents, they are required to inform you of this. If you cancel your old policy too soon before you have officially been instated with the new policy, you will have a lapse in coverage.
If this happens, you will have no insurance at all during the time you are not covered, and you will have to pay out-of-pocket expenses for any accidents or traffic incidents.
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How to Cancel Without a Lapse in Coverage
To make sure that you do not have a lapse in coverage, simply keep your old policy until you have been notified (and have the documents to prove it) of your new policy.
Once you have the coverage and have your proof of insurance cards, you can drop your former policy with the peace of mind that you are covered.
When you do decide to cancel your coverage of your current policy, here are the steps you should take to make sure you have coverage without any lapse in your policy as you are transitioning to the new one.
- Shop and compare new policies and companies until you find the one you want.
- Notify your insurance company of your intent to change policies.
- Do not cancel your current policy until you have a new policy in hand and effective.
- Once you have proof of insurance for the new policy, call your insurance company and notify them that you wish to cancel.
- Pay any remaining amounts due to the former insurance company.
Canceling Your Car Insurance Before Moving to Another State
One reason some people opt to change their car insurance is that they are moving to another state. If you are moving out of state, apparently the current policy you have will not work because it was not purchased for use within your new state.
Some insurance companies are only licensed to sell within their state. If this is the case, you will need to shop around for another company. Inquire when shopping online for insurance as to whether your current company offers other policies that work in other states.
If you are relocating to another state, you should get familiar with the new state requirements for minimums on liability, bodily injury, and property damage.
The key to getting the best insurance policy is knowing all of the details. If you are moving out of state or need to cancel your current car insurance policy for any reason, follow the steps in this article to avoid a lapse in coverage.
You may also want to look into additional coverage amounts or riders such as emergency roadside assistance plans, rental car insurance coverage, or other add-ons. It helps to read all of the options before you sign off on a new policy.
Only by shopping and comparing will you find the best policy. Use our FREE comparison tool below by entering your zip code to get started!