Whether you’ve sold your car or changed your mind during the cooling-off period, there are many reasons you may want to cancel your car insurance.
In this article, temporary car insurance experts Tempcover explains how to cancel car insurance with ease.
Can I cancel my car insurance within 14 days?
If you’ve just taken your policy out, you have a 14-day cooling-off period by law. This means you can cancel your policy without any issue and receive a refund for any money you’ve already paid.
Simply contact your car insurer and let them know you’re cancelling your car insurance. Please be aware that the cooling-off period does not apply to short-term car insurance policies of under one month.
If your cover has already started, there may be an admin fee to pay and you’ll be charged for the days when your car was insured. The later you leave it, the smaller your refund is likely to be.
If you know you want to cancel, it’s worth getting in touch with your insurer as quickly as possible.
Car insurance cancellation fees
Insurers are required by law to give you at least a 14-day cooling-off period. This is the best time to cancel your cover. These 14 days begin when you receive your policy documents or when you’ve chosen for the cover to start, whichever is the latest date.
While you’re allowed to cancel the policy in its entirety, it’s not entirely free. There may be an admin fee to cover the insurer’s cost. It might only be a small amount and it’s likely to be less than the fee you’d pay outside the cooling off period.
Your policy documents will detail exactly what the charge might be and whether you have more than the legally required 14 days to cancel.
How much to cancel car insurance?
If you want to cancel your car insurance part way through the policy, you can still get money back if you paid upfront. You’ll probably be charged a cancellation fee, which will vary from insurer to insurer.
These fees – and subsequent car insurance refunds – are calculated based on the length of the term and overall cost of the policy. It’s unlikely you’ll be refunded for any add-ons such as legal cover. You won’t get to add anything to your No Claims Discount.
You should always check your policy wording so you know what charges to expect.
Can I get a refund on my car insurance if I sell my car?
If you sell your car, don’t delay in cancelling your car insurance. You don’t need it anymore and if the new driver has an accident, a claim could be made against you.
You are entitled to a refund but the amount depends on factors including how long is left on the policy and the insurer’s terms and conditions.
There’s also the option to transfer your policy across to your new car if you have bought one. This process will involve a small administration fee and the premium may be adjusted based on the specs of the new car and if there are any changes to named drivers or your address etc.
Once you have done this, you will receive updated policy documents and a new certificate of insurance.
Can I cancel car insurance after a claim?
There shouldn’t be a problem cancelling your motor insurance if you’ve already made a claim. It’s likely you’ll need to pay the entire policy price in full with no refunds and if you pay monthly, you may have to pay for any outstanding months up front.
Can I cancel my car insurance if I pay monthly?
If you pay for your car insurance on a monthly basis, you can still cancel it. Just be aware that insurers cover you for 12 months and these monthly payments chip away at the larger amount in your premium. Therefore you might end up paying more than you expect to cancel this policy.
Many choose to pay insurance monthly as it spreads the cost. Even though it may feel like a ‘pay as you go’ contract, it isn’t…
- When you take out an annual insurance policy, you are committing to the full cost for a year.
- When you pay monthly, it’s essentially a loan of the majority that you pay back on a monthly basis.
If you cancel your monthly car insurance, it’s not a case of cancelling the direct debit and walking away. If you cancel your direct debit before cancelling your policy, the insurer may believe you’re refusing to pay and void your policy before you even contact them. This could make it harder to get insurance in future.
If you want to avoid being chased for unpaid premiums, then you need confirmation from your insurer that you have cancelled your policy. There will probably be a standard cancellation fee and charge for the percentage of the total policy with this confirmation.
If you believe you are being overcharged, you can make a complaint. The majority of insurers will charge a fixed cancellation fee if you choose to cancel before the end of the term.
Making a complaint about your car insurance company
If your insurer won’t refund you in any way or their offer is substantially less than it should be based on a pro-rata calculation, then you probably have grounds for a complaint. Get in touch with your insurance directly to discuss the issue.
Details of their complaints procedure should be readily available on their website. Make sure you keep a record of any contact you have with your insurer. They legally have eight weeks to make a final decision and if you’re unhappy with this, you can take the matter to the Financial Ombudsman Service.
Can I cancel my car insurance after automatic renewal?
Working out how much it will cost to cancel your car insurance in advance can be sensible. It may also be more cost-effective to wait for your policy to expire. If you decide on this route, check your insurer’s auto-renewal process.
If they automatically renew your policy, you’ll need to get in touch with them before the renewal date to stop it rolling over. This means you’ll be able to arrange an alternative policy without worrying about cancellation fees.
Can an insurer cancel my policy?
Yes, they can.
When you cancel your insurance premium, it doesn’t tend to affect any future claims. It’s very different if you have your insurance cancelled by your insurer. This tends to be because you have broken the terms of your policy. This could be because they believe you:
- Haven’t paid for the policy.
- Have neglected to tell them about a change of address or new job etc
- Are committing fraud.
Having your policy cancelled or voided by an insurer could lead to higher premiums in the future and perhaps even being denied a policy.
If your insurer cancels the policy on you, and not the other way round, make sure you don’t drive your car until you know you have cover in place. You would need to declare you’ve had insurance cancelled on you when sourcing a new quote as insurers and PCWs will ask about this.
Complications such as making modifications to a car can cause some insurers to cancel a policy. If this happens to you, you need to take action immediately. Even a car parked on the road without insurance could be considered an offence and end with you being fined.
Can I insure a SORN car?
If your car is going to be off the road (and you’re not selling or getting rid of it), you’ll need to let the government know you’re not driving it any more by filling in a SORN (Statutory Off-Road Notification) form. Declare your car SORN if you decide you’re not going to get another car insurance policy.
Do I lose my no claims if I cancel my car insurance?
This will depend on your insurance company. Some insurers will honour your no claims bonus but it may depend on factors including if you’re cancelling to move to another broker. Most no claims bonuses stay valid for 2 years, even if you don’t own a car in this time.
If your car is going to be off the road (and you’re not selling or getting rid of it), you’ll need to let the government know you’re not driving it any more by filling in a SORN (Statutory Off-Road Notification) form. Declare your car SORN if you decide you’re not going to get another car insurance policy.
How to choose car insurance that works for you
Under UK law, you must have at least third party motor insurance to drive a vehicle. If you’re not happy with your current policy, you may want to seek an alternative.
If you feel you aren’t getting value for money with your current deal, you may want to consider temporary car insurance. A short-term policy can help you reduce costs while considering your options for annual cover.
Tempcover’s policies provide fully comprehensive and flexible coverage for a time period that suits you – and you can get a quote in under 2 minutes.
You can apply for temporary car insurance if you:
- Are aged between 17 and 78 years old
- Are the holder of a UK or EU driving licence
- Have held your licence for at least 6 months (12 months for EU licences)
- Are looking to insure your car which is valued between £1,500 and £65,000
H2: How to Tempcover it!
Head to www.tempcover.com
- Fill in your details
- Get your quote
- Purchase your temporary car insurance policy
Frequently Asked Questions
If your car is stolen can you cancel your insurance?
Yes, your insurance company will talk you through this when you contact them to make your claim.
Can you cancel car insurance at any time?
Yes, although you will have to pay a cancellation fee. By law, you can cancel your policy within its first 14 days but you may have to pay a small admin fee to do this.
