How to Cancel Auto Insurance (2024)

The idea of canceling your auto insurance policy can feel daunting. If you’re new to car insurance or have had the same policy for a long time, it may seem impossible or intimidating to cancel your car insurance. However, canceling your car insurance is a fairly simple thing to do, and it shouldn’t take long.

Before you cancel auto insurance, you need a new policy. You should never cancel your car insurance policy if you don’t have new coverage lined up and ready to go. However, depending on why you want to cancel your car insurance, you may have plenty of time to shop around for the perfect policy. Learn how to know if you chose the right coverage here. 

Regardless of how much time you have to find your next car insurance company, you should compare quotes from several companies before you decide which you want for your car insurance. Comparing car insurance quotes is a great way to find the coverage you need at a price that works with your budget.

You Can Cancel Auto Insurance at Any Time 

You don’t have to cancel your car insurance if you’re happy with your policy. You may have car insurance coverage that meets your needs and is affordable for you and your family. If that’s the case, it’s good to hold onto your policy instead of canceling to go with a new company.

Can I cancel my auto insurance at any time?

Still, you may feel like it’s time for a change or realize that you aren’t happy with your current car insurance company. If that’s the case, it may be time to switch to something new. However, before you cancel your car insurance, you must consider other options. You should not cancel your current coverage until you find car insurance with another company that meets your needs.

Some of the most common reasons to cancel a car insurance policy include:

• Switching insurance companies. If you are switching car insurance companies for any reason, you will need to cancel your old policy once your new coverage is lined up. Never cancel car insurance before purchasing your new policy, as this could be considered a coverage gap. 
• Canceling coverage you don’t need anymore. You may want to keep the minimum coverage or full coverage car insurance policy but cancel additional coverage options you’ve purchased. For example, you may have roadside assistance with your insurance company but want to switch to emergency roadside assistance with AAA to save money.
• Selling your vehicle. If you plan to sell your car and no longer have a vehicle to drive, you should cancel your auto insurance policy to avoid wasting money. 

If you want to cancel your car insurance coverage but plan to continue driving, you must have car insurance set up with another company before doing so. Otherwise, you could get in a lot of trouble for having a gap in your auto insurance coverage. Do I have to turn in my license plates when I cancel auto insurance? Depending on the scenario, a coverage gap could mean hefty fines, higher rates for auto insurance coverage, and even a license suspension.

When to Avoid Canceling Your Auto Insurance Policy 

You should avoid canceling your car insurance until you have another policy in place if you drive in the U.S. Most states require that you carry at least a minimum amount of auto insurance coverage to drive legally. If you drive your car without insurance, you could get into a lot of trouble. 

Car insurance may seem like a hassle, especially when it’s time to pay your premiums, but the coverage can be extremely helpful if you ever get into a car accident. If you don’t have the proper vehicle coverage and cause an accident, you could end up paying for all the repairs and medical bills out of pocket. Unfortunately, most people cannot afford this, which is why auto insurance is important. 

At the very minimum, you will need bodily injury liability and property damage liability as a part of your minimum coverage. In addition, some states require the following coverage as well: 

• Personal injury protection (PIP) insurance: PIP pays for medical bills and lost wages associated with a covered accident. 
• Medical payments (MedPay) insurance: MedPay helps with fees for visits to the doctor and hospital bills associated with a covered accident. 
• Uninsured/underinsured motorist coverage: Uninsured or underinsured motorist coverage helps if someone else causes an accident but does not carry the proper coverage to pay for your damages. 

If you’re unhappy with your car insurance company or believe your rates are too high, you can shop online and compare car insurance quotes from other companies. When you do so, you should get a better idea of how much the coverage you want will cost. 

What to Do if Your Auto Insurance Company Isn’t Good

You can cancel your car insurance policy anytime, as long as you have a new policy lined up if you plan to continue driving. If you’re unhappy with your car insurance company, you can cancel your policy and choose another company that better suits you.

Policyholders often leave companies because their rates are too high. Also, many drivers leave their car insurance company after filing an auto insurance claim and finding that their insurance company was not helpful or did not handle the claims process well. (For more information, read our “Can you cancel an auto insurance claim“).

If you have a car insurance company that lacks good customer service or claims handling, it may be time for a switch. Still, you need to do some homework before choosing your next company to avoid getting another insurance company you’re unhappy with.

Read reviews on car insurance companies before you make any final decisions to learn what customers like and dislike. If you want a company with good customer service, make that a priority in your search. If you want a company that offers usage-based insurance or has a great mobile app, research companies in your area that fit that description.

What to Do if Your Driving Record Has Improved 

Some people want to cancel their car insurance because they’re in a different place as drivers. If you used to need high-risk auto insurance but now have a clean driving record and a healthy credit score, it may be time to find a company that offers the coverage you want at a more affordable rate.

You can shop online and compare quotes from several companies to learn which will reward you for your safe driving while offering you the specific coverage you need. In addition, many companies allow drivers to customize their coverage. Because of this, you will have plenty of options to choose from. 

If you need to get car insurance for a first-time driver, you may find that rates are higher than those for other individuals. In most cases, insurance companies see new drivers as more of a risk than people with more driving experience. 

Auto Insurance Cancellation Fees 

Depending on your insurance company’s car insurance cancellation policies, you may have to pay a fee to cancel your coverage. Some companies charge a small cancellation fee if you’re in the middle of a policy and have not paid your most recent premium.

However, your insurance company may owe you money if you’ve paid for your policy in full and cancel before the end of the policy term. Check with your insurance company to learn more about its policies concerning cancellations and potential fines or fees. Learn more about getting a refund when you cancel auto insurance.

How to Cancel Auto Insurance

If you’re unsure how to cancel your car insurance, there’s no need to worry. Canceling your auto insurance policy is relatively simple, and it shouldn’t take too long. 

The best option is to call your auto insurance company. Most major insurance companies tell policyholders they must speak with a company representative to cancel their auto insurance policy. You can find your company’s phone number online or by looking at your insurance card. When you call, you may be able to cancel your policy immediately, or you may need to take a few extra steps. 

If you want to cancel your auto insurance policy but don’t want to call the company, or if you’ve tried calling and haven’t gotten through to anyone, you can mail or fax your cancellation notice. Some old-fashioned car insurance companies require policyholders to submit a cancellation notice in writing via mail or fax. 

You can visit the insurance company office if you want to speak with someone in person to learn more about how to cancel your policy. If the company has offices near you, you may be able to drop in and sign or submit any necessary paperwork.

Lastly, your new insurance company may be able to cancel your policy on your behalf. If you want to cancel your auto insurance to start a policy with a new company, simply start your new policy and have your new insurer handle the loose ends. 

Read more: What is the process for canceling my auto insurance policy with Horace Mann Insurance?

What to Do After Canceling Your Auto Insurance Policy 

Once you cancel your auto insurance policy, you’ll want confirmation that everything went through. Because of this, you should:

• Clarify whether your policy will be canceled immediately or whether you’ll wait a specific amount of time. 
• Request confirmation once your policy is officially canceled.
• Ask for a prorated refund if your policy was prepaid for a certain date in the future. 

Essentially, once you submit the proper paperwork and request that your policy be canceled, you need to ensure everything went through and you no longer have insurance with your former company. 

How to Cancel Auto Insurance: The Bottom Line

If you want to cancel your auto insurance, you’ll need to follow a few steps to ensure it’s all done properly. First, never cancel your car insurance policy if you’re planning to keep driving, or you could get caught driving without insurance. Doing so can lead to serious legal ramifications.

You can shop online and compare car insurance quotes to get the best coverage in your area. When you compare quotes, you can get the coverage you want at a price that works with your budget.