You may have to travel to a different country on long-term, get settled in another state or simply move from one insurer to another, which is why you need to cancel your auto policy. So that you do not have to spend a lot of money later, you need to go through a proper cancellation process.
Here is what you must do to properly cancel your auto insurance policy:
- Inform insurance company: Call your insurer to inform him of your plans of cancellation. It is very important that you inform your carrier so that they do not bill you for the next set of premiums at the end of the year.
- Make sure that they know the date when you want to cancel. If you forget to mention the date, you may be driving your car without insurance oblivious of the fact.
- Cancellation letter: You must send a request for cancellation in writing. There are insurance sample cancellation letters that you may refer to.
- Cancellation form: You will receive a cancellation form from your insurer. It is likely that the form will already be filled out upon receipt. You may just need to sign it. However, it is recommended that you go through the form once and see if the information provided is true to its effect. If you feel that there is any discrepancy, you may contact your insurer.
- Premium refund: If you have paid off your annual premium for auto insurance, but would like to cancel your policy midway, you may be entitled to a refund of premiums.
If you wish to terminate your policy at the end of the policy period and forget to let your insurer know there could be serious consequences. You may receive a bill for your premiums for next year and failure to pay which might lead the insurance company to terminate your policy. If you think this is good news, then you must also be informed that this will go to your credit report. Once it is reported, you may find it quite difficult to get any further insurance.