Your life changes from one moment to the next. You might need to cancel your car insurance due to changing circumstances.
Your vehicle may be sold and you might need to cancel your insurance. You might need to cancel your coverage if you move to a different state or change insurers. Regardless of the reason you are cancelling, understanding the process will help you navigate it.
Can I cancel my car insurance at any moment?
You can usually cancel your car insurance at any moment. You may be eligible for a refund if you cancel your car insurance policy before the end of the current term.
It’s important to ensure that you have adequate replacement coverage if your driving plans change. Liability insurance is required in most states.
If you are caught driving without minimum coverage, you could be subject to stiff penalties. Some states could also suspend your driver’s licence, even for the first offense. If you cancel your coverage but plan to continue driving, ensure that your new policy meets all state requirements.
How can I cancel my car insurance?
Your individual circumstances will determine the best way to cancel car insurance. These are just a few of the options.
- By phone. This is the easiest way to cancel your coverage. Call your agent or insurance company to let them know your plans. You may be required to give your policy number to cancel by phone. Keep it handy.
- Mail. You can cancel your car insurance via mail with some carriers. If you choose this route, you will need to send a letter to your insurance company ending the relationship. You must allow enough time for processing and delivery if you cancel by mail. It is a good idea, therefore, to send your cancellation letter at least 2 weeks prior to your desired cancellation date.
- In person. You can cancel your insurance coverage at a local branch, such as State Farm.
Your new insurance company might be able help you cancel if you are replacing an insurer. Geico, for example, offers an online form letter that you can send to your old insurer to end the relationship.
What happens if you cancel your policy
A chain of events begins when you cancel your policy. You may be able to have serious consequences for some of these events, so it is important to know what happens after a cancellation occurs.
First, your insurance company must usually notify your local Department of Motor Vehicles if your car insurance has been canceled.
The DMV may deny you registration if they find out that you don’t have car insurance. Many states won’t allow registration of vehicles without proof that they have insurance. The DMV may suspend your driver’s licence if you drive without insurance.
If you have paid upfront for insurance coverage, your carrier may allow you to cancel. The refund will be prorated to reflect the coverage you haven’t used and has been paid for.
It is important to keep your coverage intact if you are cancelling to switch insurances. If you are caught driving in this window, even the smallest lapse could result in fines. Insurance companies will also keep track of your coverage history and could increase future premiums if there is a slight lapse.
Cancelling auto insurance without notifying the insurer
You might feel it is easiest to switch insurance companies without informing your current insurer. You would then stop paying your current insurance company and start paying premiums to the new insurance company.
This approach could backfire. You could lose any refunds if you cancel without notifying your insurer if you have paid in advance.
Do insurers charge cancellation fees?
Cancellation fees may vary between insurers and state regulations. Some insurance companies do not charge a termination fee. For example, Geico doesn’t charge a fee for cancelation.
What’s next?
You should make sure you have insurance coverage if you are considering cancelling your auto insurance policy. To ensure that you get the best car insurance coverage at the lowest price, compare multiple quotes. Also, make sure to start your new policy before your old one expires.