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Ready to break up with your car insurance provider? Not every provider will let you go easily or cheaply. Avoid surprise fees and a lapse in coverage by canceling your car insurance the right way.
To start the cancellation process, you can call your insurance company or mail in a cancellation letter directly, which you can usually download from the company website. Or if you’re switching to a different policy, your new insurer could possible help you cancel instead. Be prepared with the date you want your insurance to end and the reason for canceling.
Cancellations by phone are usually effective immediately, but ask for confirmation and written notice to prevent any fees or complications in the future. You should also provide a written notice so that you have a record in writing.
Yes. If you want to cancel your car insurance, an insurer can’t 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.
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. Let’s say you’re switching from insurance A to insurance B. Insurance A might charge a cancellation fee. If insurance A charges you $30 but you’ll be saving $10 a month by switching to insurance B, it’s probably worth it financially to go ahead and pay the fee to switch now rather than wait for your renewal period.
If you want to cancel your car insurance policy, you have options. With most providers, you can call an agent, send a written notice or cancel in person. Most car insurance companies won’t let you cancel online.
The quickest way to cancel your insurance is to call your agent. Most providers recommend this method. If you are canceling because you are getting rid of your car, you might be requested to provide proof of plate forfeiture or a bill of sale. If you plan to get behind the wheel, the agent may ask for your new insurance details, including provider, policy number and effective date. Since auto insurance is a legal contract, you might need to also supply a written notice.
Some people feel more comfortable with a face-to-face meeting to confirm everything is in order. If this is you, head down to your agent’s office to cancel your policy. Bring all of your information and documentation to prevent any delays.
If you hate waiting on hold and have a few weeks before you need your new insurance, canceling by mail might be easiest. Sometimes you’ll still need to mail notice even if you call. Your agent will inform you if they require a signed document to cancel your auto insurance policy.
If you have new insurance lined up, your new provider can usually give you a template letter, often called a cancellation letter or cancel previous insurance letter. You can usually print and sign this form online and mail it to your new insurer. Mail your letter at least two weeks before you intended to cancel, leaving time for shipping and processing. If you don’t use a template letter, include your name, policy number and contact info.
If your new insurance company doesn’t have a cancellation letter, include this information in your letter to your old insurer.
Generally, no. A new person will need to take out their own policy, so they can get their own pricing based on risk.
Yes. Many insurers will let you transfer your current policy to another car, although this may vary between insurers, and insurers are free to decline to cover your new car at their discretion.
If you do transfer your policy to another car, you can expect your prices to change accordingly. For example, let’s say you trade in your older Honda Accord for a new Toyota Prius. You might get some discounts for driving a hybrid with new safety features while also adding extra coverage for a newer car, so you’ll probably end up paying more.
Generally insurers want to keep customers, so transferring your policy to another car can be done easily. Simply contact your insurer and ask.
Yes, you can switch to another provider when your current coverage runs out. Sometimes this may be better to avoid paying cancellation fees. Make sure the date your new policy starts is the day your old policy ends to avoid a lapse in coverage.
But if you’re doing this, you need to know whether or not your policy will automatically renew. If it does, then you may try asking your insurer to simply not renew it, or remember to cancel your policy immediately before the renewal date.
Yes, if you’ll no longer be driving your car, you should cancel your registration as well, or transfer registration to the new owner if you’re selling it. Otherwise your provincial service centre could suspend your license for canceling insurance on a car you’re still driving.
When you go to cancel your policy, there’s a good chance that the person you speak to will try to retain you as a customer. Agents are used to customers calling and threatening to cancel in hopes of getting a better deal. If you find that this person won’t take no for an answer, try these tips:
If you’ve had a bad experience and are no longer happy with your provider, cancelling outright could be the option for you. Or if you are looking to save money, you might be offered new customer discounts at another provider.
However, there are benefits to staying with your provider and adjusting your policy. Most insurance providers offer discounts and different types of policies for different stages of life. Check with your agent to see what discounts and options might be available for you. Even threatening to cancel your policy might prompt the agent to offer you a discount in an effort to retain you as a customer.
If you’re looking to reduce the cost of your current coverage or want to make adjustments, then you will not necessarily need to cancel it first. Depending on what you want to change, an insurer may tell you to cancel your current policy and then take out a new one with different terms.
Some of the things you may be able to change without canceling your policy include:
Other times, an insurer may be willing to waive your cancellation fee if you’re changing policies but not insurers. For example, if you want to upgrade from third party car insurance to comprehensive car insurance, an insurer may be happy to cancel your current policy and give you a new one without charging any fees.
If you’re looking to switch providers or simply cancel your car insurance policy altogether, you can do so over the phone, in person and by mail. You can cancel any time or at the time of your policy’s renewal to avoid cancellation fees. Make sure you have a new policy in place to avoid a gap in coverage if you plan to keep driving your car.
Want to learn more? Check our our comprehensive car insurance guide.
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