What you can expect after cancelling your auto policy.
If you have to cancel your auto policy before your term is up, you are probably worried about the repercussions of your cancellation. Luckily, when you cancel your policy for a legitimate reason, there aren’t real consequences to your actions. Read on for more details.
- Voluntarily Cancelling Your Policy
If you choose to cancel your policy, it is likely for a legitimate reason. For instance, you may wish to cancel because you are selling your car or moving to a different state. If this is the case, your auto insurer will not hold a cancellation against you. This means your cancellation will not affect your ability to secure affordable car coverage in the future.
- Lapses in Your Car Coverage
While you will not run into issues from cancelling your policy, there will be problems if you fail to secure coverage immediately after your cancellation. When there is a gap in your coverage, auto insurers will consider you higher risk to insure. Higher risk translates into higher insurance costs for you. To avoid potentially costly coverage gaps, secure a new auto policy immediately after cancelling your old one.
When your auto insurance provider forcibly cancels your auto policy, this does have negative implications. Generally, insurers only cancel policies when the policyholder has proven themselves too risky to continue insuring. For instance, forced cancellations are often in response to missed payments, too many claims filed, and insurance fraud. When your policy is cancelled, other insurers will see you as risky to insure. Your reputation will make it difficult to secure car coverage at an affordable rate.
This is how cancelling your auto policy will affect you. Do you have additional questions regarding your car coverage? If so, contact the team at Weaver & Associates in Arcadia, California. We are ready to assist you today.