In the expeditious world of automobiles, owning a car comes with a lot of responsibilities, and a car insurance policy is something that should primarily be used to keep your cars financially protected on public roads.
With a commitment to safeguarding your cars and securing your economic fallout, leading insurers like Tata AIG bring a zero depreciation car insurance that covers the 100 per cent cost and ensures the company gives you the full payout during claim settlements for the covered claims.
Aside from this fact, there may come a situation where you prefer to terminate your motor car insurance, but the whole insurance cancellation process requires some careful considerations.
So, if you are someone who has purchased car insurance coverage but is now in need of cancelling the services for varied reasons, this article will surely help you to understand the hassle-free car insurance cancellation procedures.
Let us have a look.
When to Cancel Car Insurance Services?
Cancelling your car insurance is a decision that may arise for a lot of reasons, but have you ever thought of the logical cases where you can apply for a hassle-free cancellation?
Here are some common but valid reasons :
Planning on Selling your Old Car
This is the most common reason to cancel a motor insurance policy. Once you no longer need the vehicle it is obvious to terminate the associated insurance for the car.
Relocation
Moving to a different area or region might encourage the need to cancel your current car insurance coverage because of varying insurance requirements and insurance rates.
Switching Insurance Providers
When you find an insurance company with better rates or lower rates than your current providers, that is a good time to shift.
Step-By-Step Guide to Cancelling a Car Insurance Policy
Once you are sure of your decisions, the process of car insurance cancellation is quite easy when approached with the right information and awareness.
Before initiating the process of cancellation, one should keep these below-mentioned important and easy steps in mind –
- Notify your insurance company: Inform your current insurance provider immediately via mail or registered contact portal. You can also directly visit the office, or the website to raise an online car insurance cancellation request.
- Valid reasons: Give acceptable reasons to the insurance provider.
- Replacement Papers: Submit your current car insurance coverage details.
- Proper Documents: Keep a bundle of necessary documents and proofs, as your provider may ask for them.
- Inquire about the refunds: The insurance company may refund some amount, do not forget to check on that.
- Understand legal implications: Be sure to keep your eyes on the penalties (penalties are applicable only if you are cancelling your insurance services before the policy renewal date).
- Review your application: Before initiating the process carefully go through it and complete the cancellation.
- Confirmation: Make sure you receive a cancellation confirmation.
Consequences of Cancelling Your Car Insurance
Cancelling car insurance is a thing that can leave a range of addressable consequences. Driving without insurance is illegal in some areas, plus not having it can also expose you to financial risks in such cases as road accidents and car damage, so it is always a better idea to keep your car covered with valid motor insurance.
After a car insurance cancellation you may face:
- Troubles in purchasing a new policy,
- Higher premium rates,
- Difficulty in finding affordable coverages in the future,
- Penalties,
- Legal licence suspensions,
- Financial burdens,
- A drop in driver rating,
- Impacts on insurance records, and many more.
Before finalising the decision on car insurance cancellation it is essential to understand some specific steps and terms, we are mentioning some points to keep note of:
- Try to buy a new insurance policy before quitting the current one to avoid the coverage gap.
- Adjust existing coverage.
- Based on your area the insurance provider may charge some cancellation fee, be sure to check that.
- Know about the car insurance cancellation laws to maintain the penalties and fines.
- Maintain simple communications with your insurance provider.
- Compare motor insurance rates.
- Explore alternative options.
Conclusion
An insurance cancellation can be initiated by both sides, either from the policyholder or the insurance company. Insurance companies are allowed to cancel your services due to non-payment, on the other hand, a policyholder can make their choice of cancelling the four-wheeler insurance according to their responsible reasons.
Understanding the terms and conditions of car insurance cancellation can be beneficial for a policyholder in making informed decisions and can help avoid various risk factors. Additionally, taking the guidance of any valuable insurance company is advisable.
