I Want To Cancel My Car Insurance Policy How Can I Do This
Cooling off cancellation
If you change your mind after you take out a car, home or van insurance policy with AXA, you can cancel this policy within 14 days. This is .
For more information please see your relevant policy booklets.
If you wish to cancel your policy mid- term please return your certificate of insurance and insurance disc with a written request to:
When To Cancel Car Insurance After Selling A Car
So youve decided to sell your car and need to know how to cancel car insurance properly. Maybe its time to upgrade. And with the vast technology and innovations in engineering offered in new cars, its an exciting time to try out a new vehicle. Or perhaps you are simply selling your car because you need the extra money. Regardless, you will want to know when to contact your insurance company and cancel your policy.;
Lets take a look at all the steps involved in canceling car insurance and the right time to do it.;
Cancelling Car Insurance When Selling A Car
When selling a car in a private transaction, it is important to properly time when you cancel your car insurance. While the car is listed for sale and prospective buyers are test driving it, you must keep your insurance active. In most states it is illegal to have an uninsured vehicle on public roads. Once the terms of a sale have been determined, the timeline and steps are usually as follows:
For additional information, consult your state’s DMV website. Typically a detailed step by step list outlining the car selling process will be available with links to applicable forms.
Can My Policy Be Cancelled If I Make A Misrepresentation When Answering The Insurers Questions
Yes We will ask you questions and your answers will help us decide whether to insure you, and on what terms. Each question we ask you is important.
You have a legal duty under the Insurance Contracts Act to take reasonable care not to make a misrepresentation to us. This means you must answer all our questions fully, accurately, and honestly.
If you fail in your duty, we may cancel your policy. Or we may reduce the amount we pay you if you make a claim. Or we may do both of those things.
If your failure is fraudulent, we may refuse to pay a claim. And we may treat the policy as if it never existed.
Can I Cancel Car Insurance Extras
All of the extra features you are paying for on your car insurance policy, such as breakdown cover and legal expenses cover, are likely to be non-refundable.;
So, if you cancel your car insurance, you probably won’t get the money back on those features.;
Additionally, you could be hit with an administration charge for making changes to your policy.
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You Can Cancel Your Policy Before It Starts
Car insurance doesn’t have to start straight away. If you set your policy to start in the future, you’ll be able to cancel before the policy starts.
If you cancel before the policy starts, you usually won’t have to pay a fee. And because you haven’t been covered, you’ll get a full refund.
Your cooling-off period doesn’t start until the policy starts.
What Happens When You Cancel Your Policy
When you cancel an auto insurance policy, your insurer will likely notify your state that you and your vehicle are no longer insured. Because its illegal to drive without insurance in virtually every state, your states department of motor vehicles may ask you for proof that you either sold the vehicle or have obtained other insurance. If you dont respond, then the state can suspend your registration and drivers license. In some states, you also may be required to return your license plates.
If you still have time left on the policy, your insurer may issue a prorated refund of the premium that you paid most recently. However, some insurers also charge a cancellation fee if you want to get out of your policy early.
If youre switching insurance companies, make sure to have the new policy lined up before you cancel the old oneand tell the new insurer exactly when your old policy is set to expire. Lapses in car insurance are illegal in many states and can result in fines. If you have an outstanding car loan or lease, you should also notify your lender that you have changed insurers.
If youre cancelling your policy because youre moving to a new state, note that you will typically have to show proof of insurance when you register your car there. States have different rules regarding the types and amounts of insurance that youre required to carry.
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What Other Charges Can You Expect After Cancelling Car Insurance
Cancellation fees can have many names between different insurance providers. Cancellation fees, admin fees, processing fees, the list can go on. Make sure you read your policy carefully before cancelling, so you know what to expect. Some insurance providers will charge you a percentage of the remaining cover you have on your policy, which, depending on how long you have left, can add up. Dont go in to cancelling your policy blind, in order to avoid any nasty surprises.
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Cancelling Your Cover If You Are Not Replacing Your Car
If you plan on selling your vehicle and not replacing it, its usually recommended that you cancel your car insurance as soon as its sold and getting as much of the premiums back as possible in the form of a refund.
This is because the car will no longer be yours and you inevitably wont be using it, so theres no need to pay for cover.
Note that, if you sell your car with a month or two left on your insurance, the cancellation fee might be more than the refund you would receive, so many people are tempted to let the policy lapse. But be careful, if you let your insurance policy run while you no longer own the vehicle covered, theres a chance that the new owner of the car could be involved in an accident and try to make a claim on your policy.
This could cause all sorts of issues, so err on the side of caution and cancel your car insurance if you arent replacing your vehicle.
Will I Pay Cancellation Fees
It depends on the insurer. You can usually skip the fees by waiting to cancel until your renewal time. Cancellation fees can vary from $25 up to a percentage of your overall premium. Most companies that charge a fee will either bill you a flat amount or a percentage of your remaining premium if you need to cancel before your renewal period is up.
One thing to consider is the cost offset of canceling. Lets say youre switching from insurance A to insurance B. Insurance A might charge a cancellation fee. If insurance A charges you $30 but youll be saving $10 a month by switching to insurance B, its probably worth it financially to go ahead and pay the fee to switch now rather than wait for your renewal period.
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Consider Suspending Policy Instead Of Cancelling
Under certain circumstances, your insurance company may allow you to suspend your policy without cancelling. For example, GEICO allows military members to suspend their insurance if they will be storing their car for more than 30 days. Suspending coverage essentially pauses your policy without cancelling it. You can avoid being penalized for any lapse in coverage.
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Car Insurance Cancelation Fees
Depending on the auto insurance company, canceling your policy before the end of its term may result in a cancelation fee. State laws can determine if a fee is allowable, and, if so, it is up to the insurer to set that fee, which is often taken out of the prorated refund.
If you ask your provider about cancelation fees, knowing whether your state makes fees permissible could help you prepare in advance for any charges.
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Mail Or Fax A Written Request
Signing a cancellation request seals the deal when it comes to canceling car insurance. It’s as easy as writing or typing out the date, your name, and policy number, and requesting cancellation on the date you are planning on switching carriers. Sign the document and mail or fax it to your agent or direct to the insurance carrier.
Cancelling Your Car Insurance If You Are Replacing The Vehicle
If, however, you plan on replacing your vehicle with a new one, you may not want to cancel your car insurance policy.
Most of the best car insurance companies will offer to update your policy to cover the new vehicle, which means that you dont have to cancel and take out cover with a new provider if you dont want to.
You should still contact the insurer to let them know that you are selling your car and getting a new one, of course, as this will require an updated policy and could impact your premiums. If you fail to let them know that youre driving a new car, you will not be covered.
Theres also a slight chance that your provider will not be able to cover the new vehicle, meaning that you may be required to take out cover elsewhere its always best to check.
Insurance providers usually charge a fee for amending your policy, and you may be charged more expensive premiums to reflect the added risk associated with your new vehicle .
This wont always be the case though, and you might end up paying less for cover it depends on your personal situation.
If youre going to replace your car immediately, you should start by contacting your provider and asking them whether or not they will be willing to cover the new vehicle. If they are, you may not need to end your policy and could avoid paying any cancellation fees.
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Give Your Insurance Provider A Call
There is already a common misconception that when you sell a car, the local DMV office and the insurance company will know automatically. However, it is your full responsibility to contact your insurance company and informed the local DMV office, depending on your state. There are some states where the local DMV office will receive the bill of sale. However, it is not in all States, and the insurance companies will not know.;
Get in the call with the insurance company and let them know that you sold the vehicle. Check with them if there are any cancellation fees or any other penalties you must keep in mind when selling your car.;
If You Sell Your Car Or Switch Companies Make Sure That Your Old Insurer Knows
There are several reasons why you might need to cancel a car insurance policy. For example, maybe you no longer own the car in question. Or youre moving to another state. Or you want to switch to a less expensive insurance company. Whatever your reason, the process should be relatively straightforward. Heres how to go about itand how to avoid some pitfalls.
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Notify Your Current Insurer Of Intentions To Cancel
Notify your provider of your intentions to cancel once your new provider has your new one is ready. While the process of cancelling varies by company, most require you to provide an insurance cancellation letter.
Even if you are not required to provide a cancellation letter, it is a good idea so you have a record of the date you requested cancellation.
Be open to the idea of your current insurer offering additional discounts or incentives to maintain it.
The Bottom Line For Canceling Auto Insurance Claims
If youve filed a claim and later decide you want to cancel it, you can do so. If you decide to cancel your claim, the sooner you do so in the claims process, the better.
Reasons for canceling a claim include realizing that your deductible is about the same as the cost of repairs, not wanting your insurance rates to increase, or deciding to complete any repairs yourself.
If you cancel a claim, it should not affect your insurance rates, though it will still show up on your record as either a zero-dollar claim or as withdrawn.
Speak to your insurance agent to find out the specific terms of your policy, in the event you cancel a claim. If you decide youd like to switch insurance providers, shopping around gives you the opportunity to always have the best rates available for your personal situation.
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Can You Cancel Insurance On A Financed Car
While officially the government will let you, your auto loan wont allow it. Remember that depreciation accounts for a massive amount of a cars worth. That means, within a year, your car is likely worth less than you owe on it. If youre in a collision, car insurance will pay the actual cash value, which wont cover the cost of that loaned car that you now have to pay back because its a write off. Youre left with thousands owing on your auto loan, and no car to speak of it. This is when you need gap insurance and unless you bought it when you leased the car, youre out of luck.;
Can I Cancel My Policy At Any Time
Yes. If you want to cancel your car insurance, an insurer cant say no. But they can make it difficult to cancel by charging a fee for ending you policy early. Calling is usually the easiest way to find out about the best process and avoid fees.
If your insurer offers prorated premiums, you may also get a cancellation refund for unused portions of your premium. Check with your insurer on how they handle prorated charges.
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Do I Get A Refund If I Cancel My Car Insurance
You have 21 days from when your policy begins or is renewed to change your mind. If you cancel within this period and havent made a claim, you can get a full refund. Outside of the 21 day cooling off period, you may still be able to receive a refund of the unused portion of your premium, less any non-refundable government charges. We will not give a refund if the refund is less than $10 .
AAI LIMITED TRADING AS AAMIAAMI Home Building and Home Contents Insurance, Landlord Insurance, Strata Insurance, Car Insurance, Motorcycle Insurance, NSW and SA CTP Insurance, ACT MAI Insurance, Caravan Insurance, Business Insurance and Travel Insurance are issued by AAI Limited ABN 48 005 297 807 AFSL 230859 trading as AAMI. Registered Office, Level 28, 266 George St, Brisbane QLD 4000.
This content is current for Home Building, Home Contents, Fire & Theft Contents, Landlord, Strata, Car, Caravan and Motorcycle Insurance policies with a start date after 14 December 2020.
Youll Leave A Bad Impression
Leaving an insurance company without giving notice can leave a bad impression. It is a good idea to leave on good terms, especially if there’s a chance you may want to return at some point. Rates are always changing; you may want to go back to your old insurance company again one day. To prevent it from feeling awkward in the future, notify your agency of cancellation.
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Reasons To Change Car Insurance Policies Or Providers
Cancelling car insurance is a good idea when you’re planning to switch to a cheaper policy, one with more suitable coverage or both. Prior to switching, check with your current provider whether you are eligible for any discounts that may lower your premiums.
Adjustments to your coverage, such as lowering your coverage limits or getting rid of special equipment coverage after getting a new car that doesn’t have custom parts, can also help reduce your overall costs and eliminate the need to cancel auto insurance. Be sure to discuss with your carrier any coverage changes that can lower your rates while still providing you with sufficient protection in the event of an accident.
It’s always a good idea to shop around for cheap car insurance, since you may be able to find a better rate without having to change your coverage.
Editorial Note: The content of this article is based on the authors opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.