What will happen if I cancel my car insurance?
There are several situations when cancellation of car insurance is acceptable by both parties.
- You change your mind after a few days from signing the policy. This is known as the “grace period.” Some insurance companies may consider your request for cancellation if you provide a reason acceptable to them. You may expect to be charged a termination fee or consider your initial payment as non-refundable.
- If the insurance policy has been in effect after the grace period and you decide to cancel, it will come out in your history and affect future applications for insurance. One effect would be a higher rate. You can also have a difficult time finding an insurance company willing to accept you as a client.
- You will not be able to drive a vehicle legally since in most states, there is a minimum insurance required. If you are caught driving without insurance, you could have your license revoked or suspended and be required to pay a penalty.
- If you are thinking of switching provider you are better off waiting until the policy expires and then informing the insurance company that you do not intend to renew with them.