Car insurance is designed to protect us if the worst happens. But valid car insurance relies on you telling the truth and following the rules outlined in your policy. Failure to do so, even unintentionally, could leave you uninsured and struggling to find cover if your insurer cancels or voids your policy. Our guide will help you minimise the risk of voided or cancelled car insurance and understand what to do if it happens.
Voided car insurance is any policy that has been ruled invalid by the insurer. There are a number of reasons this may happen. The most common are that the customer fails to pay their premium, or has submitted false or incorrect information to the insurer.
If an insurance provider voids a car insurance policy, it is equivalent to that policy never having existed and no protection ever having been in place. This, in turn, means that any claim being made (even before the date on which the policy was voided) will not be successful.
Ultimately, you’ll want to avoid having your car insurance voided at all costs. But to do that, you’ll need to understand how this could happen in the first place.
While the end result can be similar – you’re left without car insurance – there is a subtle but important difference between your insurer voiding and cancelling your cover.
In both cases, you may not be entitled to any refund of premiums you’ve already paid.
There could be several reasons why an insurance provider might cancel or void a car insurance policy, but these reasons tend to fall into 1 of 4 categories:
If you fail to pay for your insurance premiums on time or you miss payments altogether, your insurance company is likely to contact you to remind you about outstanding premium payments. It might also start discussions about putting in place an alternative arrangement for making the missed payments.
Although your insurance provider can cancel your policy at any time, it should give you sufficient warning before doing so. So, if you accidentally miss a payment (because of problems with your bank account, for example), you should be given the chance to put it right.
If you’re concerned about cash flow and worry that you’ll miss an upcoming monthly payment, get in touch with your insurer before it happens. That way, you can come to an agreement about how to manage the problem. It might give you a few days extra to pay, for example.
Bear in mind that while missing a single payment is unlikely to invalidate your policy, consistently failing to pay can become a serious issue and result in cancellation.
If your insurance provider finds out about information that you failed to share when taking out the car insurance policy it could decide to void your policy. This non-disclosure of information can relate to things like:
Failing to inform your insurer when your circumstances change also falls into this category and is likely to result in your policy being cancelled from the date of the change. You’ll need to tell your insurer if, for example, you move house, change jobs, make modifications to your car or change car entirely.
Insurers will also need to know about any accidents, big or small, even if you don’t claim on your policy. This can include even minor scrapes. If you don’t tell your insurer about small accidents and it later finds out if you make a claim for more serious damage, it could render the later claim invalid.
An insurance provider will usually view each non-disclosure case separately and base its decision on how serious the issue is. For example, if the non-disclosure was an innocent mistake of information being missed off the car insurance application form or you having forgotten about a claim a few years back, the provider may be more forgiving and simply adjust your premium (if appropriate) to account for it.
If, on the other hand, information was deliberately kept from an insurance provider, the company could treat it as fraud and decide to cancel or void your protection altogether.
In some cases, yes. While it can’t check the details of medical conditions, for example, it has access to a central database (CUE), which has details of claims and reported incidents. So it’ll be able to quickly sniff out if you’ve made a claim that you haven’t disclosed.
Each insurance company will have its own set of guidelines around what it classes as fraud, but most will generally include the following:
As with non-disclosure, insurers are likely to consider the policyholder’s intent (was the false information provided deliberately?) when deciding if they’ve committed insurance fraud. But there may be occasions when you find yourself accused of fraud even if it was unintentional.
Don’t risk it. It is likely to void your insurance and could open you up to a prosecution for fraud.
You can sometimes invalidate your policy by doing something you didn’t even realise was wrong.
Things like the number of people you are allowed to have in your car and what you’re allowed to use your car for can vary between different policies and providers. Make sure you know exactly what your policy includes and what it forbids you to do to avoid any issues.
Some potential breaches are pretty obvious – such as driving without a licence or driving under the influence. Car insurance exclusions it can be easier to accidentally fall foul of include.
These exclusions won’t necessarily result in your policy being cancelled. They could simply mean that incidents that take place while an exclusion is at play won’t be covered. But, either way, it’s not worth taking the risk.
If your insurance provider informs you that your car insurance policy has been voided or cancelled, it’s important that you don’t bury your head in the sand. Instead, it will be better if you contact your insurer immediately to find out the reasons. That way, you may be able to rectify the issue quickly.
If your provider is unwilling to reinstate cover, you will need to look for alternative car insurance immediately as your car will have no valid cover in place. Driving without insurance, even for a couple of days, is an offence and could land you with a minimum £300 fine and 6 points on your licence.
If you are not happy with your insurer’s decision for cancelling or voiding your policy, you may be able to appeal. The quicker you act, the more likely you are to find a solution. Complain in writing to your insurer first. If you’re not happy with its response, you can escalate your complaint to the Financial Ombudsman Service (FOS).
Yes. Having a car insurance policy cancelled or voided, even if the reason wasn’t your fault, can mean you struggle to find a policy to cover you. Providers will consider you a higher risk of being a problem customer, so may be unwilling to insure you at all.
Quotes from insurers that are willing to cover you are likely to be higher.
How long is a piece of string? Every insurer will apply its own criteria, but you’re likely to see a substantial increase.
The size of the increase may depend on the reason for the policy being cancelled or voided. If the reason your previous cover was cancelled relates to a conviction or fraud, an insurer is likely to assume you are more of a risk to insure, meaning your premiums could skyrocket.
Don’t be tempted to keep costs down by neglecting to mention the cancellation, though. This will only exacerbate the issue by voiding your next policy too, resulting in double trouble.
There is no set time that a cancelled insurance policy will stay on your record for. Some insurers may only request your insurance information for the last 5 years. Others may require you to share your history going further back than that. Always be upfront and disclose all information to the best of your knowledge. Failing to do this could cause you even more problems later on.
Insurance companies sometimes make mistakes (hard to believe, we know). If they cancel or void your policy in error and then realise they’ve made a mistake, they will “rescind” the cancellation.
If this happens, you don’t need to declare it to any subsequent insurer. It’s a good idea to get confirmation in writing that the cancellation was, effectively, cancelled, because of the insurer’s mistake (not your own).
Yes. This is entirely different to when an insurer cancels your insurance because, in its opinion, you’ve done something “wrong”. You can cancel your car insurance at any time during the term, whether you pay annually or monthly. For example you might want to cancel if you sell your car or go abroad for a few months and declare your car off the road (SORN). You don’t need to declare this to future insurers and it won’t affect your ability to get insurance in the future. However, you will miss out on building up another full year of no-claims bonus.
In most cases, you should receive a refund for any remaining premiums you’ve already paid. You’ll likely need to pay a cancellation fee, though, which will wipe out some of the refund.
The shock of having your car insurance voided or cancelled by your insurer is definitely one you don’t want to experience. Not only could it leave you uninsured, it could make it tricky and expensive to find alternative insurance in future. Even if you have no intention of deceiving your insurer, sometimes innocent mistakes could put you at risk of invalidating your policy. Following the advice in this guide can help you keep that risk to a minimum.
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