Insurance gives you extra protection if things go wrong. However, you may decide that you no longer want or need your insurance policy. This page explains what you can do if you’ve taken out an insurance policy and decide you want to cancel it.
Cancelling during the cooling-off period
You may want to cancel an insurance policy if you have just bought it and have changed your mind. By law, you have a minimum 14-day cooling-off period during which you can cancel the policy for any reason. If you’ve bought life insurance, the cooling-off period is 30 days.
The cooling-off period starts from when the policy begins or when you receive your policy documents, whichever is later. You should get a refund of any premiums you have already paid. However, your insurer may take off a small amount to cover days when the policy was in force. They may also charge you a small administration fee.
Some insurers may give you a longer cooling-off period. If you’re not sure how long your cooling-off period is, you can check the terms of your insurance policy.
If you want to cancel your policy during the cooling-off period you should contact your insurer as soon as possible
The right to cancel during a cooling-off period does not apply to travel insurance that lasts less than one month.
Cancelling after the cooling-off period
If you want to cancel your policy after the cooling-off period you should check your insurance policy. Most insurers will give you a refund if you have not made any claims during the policy year but you will usually have to pay administration fees.
If you are thinking of cancelling your policy because you’ve found a better deal with another insurer it may be easier and cheaper to wait until your policy is due for renewal and then switch.
Cancelling a direct debit does not cancel your insurance policy. If you do this you will still owe your insurer the premiums. You must contact your insurer to cancel the policy.
Some policies are automatically renewed each year. It’s important to check when your policy is due for renewal so you can make sure that it is not renewed when you don't want it to be.
It’s a good idea to make sure you have a new policy in place before cancelling the old one so that you’re not left uninsured.
Can your insurer cancel your policy?
Occasionally your insurer may wish to cancel your policy. They are only likely to do this if they believe:
something has happened to make it much more likely you will make a claim, or
you have not kept to the terms of the policy.
In most cases your insurer will wait until the policy needs to be renewed then refuse to renew the policy.
Next steps
Check that you are within the cooling-off period.
If your cooling-off period has ended, work out whether it will be better to wait until your policy needs to be renewed, rather than cancel straight away
FAQs
Generally, policyholders receive a prorated refund of unused premium payments remaining after the cancellation date. However, providers may also leverage fees or impose a cancellation wait time. Drivers' insurance may also lapse, resulting in fines or loss of license.
Can I cancel an insurance policy at any time? ›
Policyholders can cancel their auto insurance policy at any time, for any reason. And you never have to wait until the end of your policy period to cancel your policy. Even if your policy only started a few days ago, you may cancel it.
Does canceling insurance affect anything? ›
Cancellation due to non-payment will probably result in higher rates when you purchase new coverage. Plus, if you keep an uninsured vehicle, you'll be financially and legally responsible if you cause an accident.
Is cancelling an insurance policy bad? ›
If you cancel, it doesn't usually affect getting insurance in the future. But if your insurer cancels, it's because they think you did something to break the rules. Having a policy cancelled (or voided) by your insurer can make your insurance a lot more expensive further down the line.
Do you get charged for cancelling insurance? ›
Just tell your insurance provider that you want to cancel and they'll arrange it for you. You'll probably have to pay a fee, which may be described as an administration, arrangement, processing or cancellation fee by your insurance provider. This fee can vary among providers and depending on when you cancel the policy.
Does it cost to cancel an insurance policy? ›
In most cases, you won't have to pay a cancellation fee. If you do, it will likely be nominal — around $50, or a small percentage of your final premium. If you're facing high fees and switching to a new auto insurance provider, consider whether it makes more sense to wait until the end of your policy's term.
Do you get a refund if you cancel your insurance? ›
If I cancel my auto insurance, will I get a refund? If you paid your premium in advance and cancel your policy before the end of the term, the insurance company might refund the remaining balance. Most auto insurers will prorate your refund based on the number of days your current policy was in effect.
Who has the right to cancel an insurance policy? ›
Cancellation by the Policyholder
Similar to the insurance company, a policyholder is not obligated beyond the term that is specified by the policy. Therefore, a policyholder may cancel the policy by simply not paying to renew it. It is also possible to cancel a policy midterm.
How long do you have to cancel a policy? ›
As with most goods or services, it's a legal requirement to provide you with a 'cooling off period' to give you 14 days to cancel your insurance policy. You don't even have to give a reason.
What is a good reason to cancel insurance? ›
Reasons to consider canceling your insurance policy:
You believe you're paying too much for insurance. Your business has changed, and you need different coverage. You're moving out of state, and your current insurer doesn't offer policies in your new location. You're unhappy with the service your insurer provides.
The length of the grace period is dictated by each state's insurance laws, but it is typically 10 to 20 days.
Does Progressive charge a cancellation fee? ›
Is there a fee for cancelling Progressive? This varies by state and when you purchased the policy. In some states, Progressive will charge a $50 cancelation fee if you cancel within your first term; meaning your policy has not yet renewed. Once the policy has renewed there will no longer be a cancellation fee.
Do I lose my no claims if I cancel my insurance? ›
Do I lose my no-claims discount if I cancel my insurance? Yes, it's likely you'll lose that year's no-claims discount because you won't have completed one full year of claim-free driving.
Does the 14 day cooling-off period apply to everything? ›
You automatically get a 14-day 'cooling-off period' when you buy something you haven't seen in person - unless it's bespoke or made to measure. The cooling-off period starts the day after you receive your order, and there doesn't need to be anything wrong with the item for you to get a refund.
Should I have a cancellation policy? ›
While emergencies happen, and they're often unpredictable, they are rare. Cancellation policies encourage others to follow through with their commitments to you. For example, you could charge a fee for anyone who cancels within 24 hours.
Do you get your money back after Cancelling insurance? ›
If you choose to cancel your policy, or your insurance company cancels it, you typically won't get a car insurance refund unless you've paid the premium in advance.
What is the difference between cancellation and surrender of insurance policy? ›
Essentially, surrendering a life insurance policy means that you're canceling it. You will no longer owe premiums and if you pass away, your beneficiary will not receive a death benefit payment. Discussions about surrendering a life insurance policy typically only refer to permanent life insurance policies.
What are the three types of cancellation? ›
When filling out the lost policy release, also called a “cancellation/lost policy release,” the insured typically chooses between three types of cancellations: flat, pro-rata, and short rate. Flat cancellations are used when the insurer was never exposed to risk because the coverage never went into effect.
