There may be situations where you might want to cancel your car insurance policy. In such cases, there might be a certain amount of money that you might have to pay to your insurance company as fees. Whether or not the fee is charged will depend upon the time when you cancel your plan.
For instance if you cancel your policy during the term of the insurance, a fee will be charged. If the annual premium has been paid and there is still time left on the policy, then the insurer will be responsible for reimbursement of your premium amount on cancellation.
Reasons for Car Insurance Policy Cancellation
There may be various reasons why you would want to cancel your insurance policy. For instance, if you want to sell your car, the old insurance will serve no purpose and you will have to get it cancelled.
There could be other reasons too, such as theft of your vehicle, disposal of your car due to the age of the vehicle and dissatisfaction with your insurance company due to various reasons such as a high premium, stringent policy clauses, lower sum assured or some similar reason.
The Process of Cancellation of Your Car Insurance Policy
Having an auto insurance policy is imperative for everyone who owns a car. If you choose to apply for a cancellation, you must buy another policy. To begin the process of cancellation, intimate your insurance company about your decision to cancel the policy in writing. This will set the process of cancellation in motion, with the entire process taking not more than 15 days.
Once the cancellation process is completed, the insured will receive a letter confirming that the policy has been cancelled; any pending dues that are to be refunded by the insurer will also be mentioned in this letter. That’s not all. You will also need to follow-up with your insurer to collect the Certificate of Insurance. This certificate will come in handy when you go for a new insurance policy.