How Do I Cancel My Car Insurance?

How do I cancel my car insurance?

• You can cancel vehicle insurance with immediate effect
• But don’t chop and change from one policy to the next
• A history of cancellations can have a negative impact
• Shop around for the best product before opting in
• Honesty is the best policy when applying for insurance

Technically, you can cancel car insurance policies with immediate effect.

However, motorists should give their short-term insurance companies a standard one month’s notice to cancel their cover.

This will ensure that they keep “a clean record” when applying for vehicle insurance elsewhere.

By following standard procedure, motorists will maintain a good insurance profile.

Cancellation can cost money

Many motor vehicle insurance providers insist on a full year’s premium payment in advance.

So, while the South Africa Special Risk Insurance Association states that vehicle insurance may be cancelled at any time, this decision would result in forfeiture of any refund, or pro-rata refund, on premiums.

The disadvantages of no insurance

A staggering 65% of motorists in South Africa do not have vehicle insurance.

So should an accident occur and both parties are uninsured they will both have to finance the cost of repairs.

If an uninsured motorist is involved in an accident with an insured party, repairs will be covered by that person’s insurance company but the cost will have to be repaid by the uninsured party.

Think twice before you cancel your insurance

Motorists should think twice before cancelling their vehicle insurance.

If reasons for cancellation are not valid it could impact negatively when applying for insurance elsewhere.

A newly approached insurance company could investigate previous claims and losses incurred by the applicant from the previous insurance provider.

If the new company discovers that an applicant has previously cancelled a vehicle insurance policy, they could reject the applicant’s request for cover.

What are the alternatives?

Motorists should adopt an “honesty is the best policy” attitude if applying for vehicle insurance after having terminated a previous contract.

After all, not all people cancel vehicle insurance contracts for the “wrong” reasons.

A motorist is entitled to shop around for an equally good product at a more affordable price.

A motorist is entitled to shop around for a product that offers benefits more suited to individual lifestyles.

However, your should avoid chopping and changing insurance providers even if you can get quality cover and good benefits elsewhere.

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All info was correct at time of publishing November 4, 2018