How to cancel car insurance
When it comes to cancelling your car insurance, each company has their own policy.
Whether you’ve declared your car as SORN, sold your car, or have simply renewed your car insurance early elsewhere, you’ll need to cancel your existing policy.
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I don’t want my policy to renew, but I can’t get through to my insurer. What should I do?
During the COVID-19 pandemic, you may find you can’t contact your insurer on the phone because of long wait times.
If this happens, you can email the insurance company, confirming that you don’t want the policy to renew. This should be enough to cancel the policy before the renewal date. Bear in mind that only the policyholder is able to cancel insurance policies.
You can find your insurer's email address on their website. In your email, it'll help to include:
your policy number and renewal date
the policyholder's name, date of birth and postcode
your car's reg
It might also help if you add in a reason for cancellation, and mention that you weren't able to get through over the phone.
Make sure you have valid insurance in place to cover you after the renewal date.
Cancelling because your car is declared as SORN
If you’re keeping your car, but won’t be driving it for the foreseeable future (e.g. it’s an older car that needs a lot of work), you can register it as SORN with the DVLA. When you do that, you have two choices, you can either cancel your current insurance policy with immediate effect, or keep it.
Why would you keep it? Well, you may want to keep it to cover the cost of replacing it should it catch on fire, or if it’s stolen. If you choose to keep the policy, you’ll also be earning no claims bonus.
How to cancel your car insurance
Cancelling your car insurance is generally a simple process. Depending on who you're insured with, you might be able to cancel it online, which is the easiest way to do it. However, lots of insurance companies want to speak to the policy holder to cancel, if that's the case, you'll need to:
Get your policy documents to hand so you have your policy number
Call your insurance company (it'll need to be the policy holder that does this)
Tell them you're cancelling your car insurance (they may ask why, that's fine)
They'll explain any fees and might ask you to send your certificate of motor insurance back to them (they'll explain how to do this)
If you're declaring your car as SORN, make sure you fill in the SORN form with the DVLA
READ MORE: How to declare your car as SORN
Cancelling because you’ve sold your car and aren’t replacing it
Possibly the simplest reason to cancel your car insurance is because you no longer own it.
Simply call up the company your car insurance is with, tell them you no longer own the car and want it to be cancelled. They’ll send you a copy (whether paper or via email) of your no claims bonus (NCB), which stays valid for two years.
After two years, you’ll lose however many years you had built up. Make sure you keep your NCB proof somewhere safe, as the next company you take out insurance with is likely to want to see a copy of it for proof.
However, if you’re selling your car and buying a new one, you don’t necessarily need to cancel your old policy.
You should be able to either call up your car insurance provider, or if they’re online only, log in and change your car to your new one.
The premium could go up or down for the remaining term of the policy, depending on the risk of the new car.
If the premium increases a lot, you’ll need to take into consideration the potential cancellation fees and loss of NCB as part of the cost of changing cars.
READ MORE: Can I sell a car with outstanding finance?
Changing the date your insurance renews
If you have multiple cars in your household, you might want to change the month your car insurance renews so they renew at the same time of year.
To break the cycle of renewing at a certain time, you can buy a new car insurance policy at the date you prefer, and then cancel your old one.
However, if you decide to do this, you will lose the current year of NCB that you’re earning. When you compare quotes, make sure you haven’t added another years’ NCB as you’ll lose it when you cancel your existing policy.
READ MORE: How car insurance is calculated
What is the car insurance cooling off period?
When you take out a new car insurance policy, as with any insurance, you have a cooling off period. Regardless of which company you choose, by law you have 14 days to change your mind and cancel.
You shouldn’t have to pay a cancellation fee, although some companies may try to charge you. You will however have to pay for the days you've been insured.
If you paid for the policy in one lump sum, you’ll most likely get the rest of your money back, less the cost of the amount of days you were insured.
If you've been paying monthly, you’ll most likely get a part-month refund and the direct debit cancelled.
To be sure the direct debit is cancelled, make sure to call your bank to check.
READ MORE: How to chance your car insurance policy
Car insurance cancellation fees
Generally speaking, if you cancel within the first 14 days most insurance companies won’t charge a fee for cancelling, but be aware that some will.
However, if your policy has been active for longer than that, you’re likely to have to pay a cancellation fee and the cost for the time you've been insured (pro-rata).
With most companies, the cancellation fee is to cover the administration of cancelling your policy and sending out relevant documents.