If you cancel your car insurance early, your insurance company will normally charge a tip .
car policy cancellation fees are around £50 .
If you cancel within the first 14 days, the fee might be lower, or there might not be a tip at all .
When you cancel, you ‘ll get the pillow of your premium refunded ( minus another charge for the time you ‘ve been insured ).

This guidebook explains everything you need to know about how car policy cancellation fees normally work .
We do n’t think cancellation fees are fair though .
That ‘s why Cuvva is building a raw, pay-monthly car policy that you can cancel any clock without having to pay a fee .

When do you pay car insurance cancellation fees?

If you want to cancel your car indemnity, you need to get in touch with your insurance company. That normally means a phone call, although some will let you do it online .
When you cancel your car indemnity, you ‘ll have to pay a fee. But you ‘ll besides get a refund for the months you have n’t so far used up. Except for the concluding two months of the policy. Insurers wo n’t normally refund this .
so, if you ‘ve paid for a year of car insurance up front man, and you ‘ve got six months left till it ‘s time to renew, cancelling will mean you get refunded for four months of policy, minus any cancellation fees .
You wo n’t normally get a refund if you ‘ve made a claim on the policy. And you wo n’t ( normally ) get a refund for any extras you pay for, like breakdown cover, if you ‘ve claimed on those .
Cancelling your car policy is n’t the lapp as not renewing your car policy. That ‘s called “ sink ”, and there ‘s a boastfully deviation between the two .
You do n’t have to pay a cancellation tip if you let your policy relapse. You fair have to let your insurance company know you want to let your policy oversight – if it ‘s set up to auto-renew .

Car insurance policies have a cooling-off period

All car insurance policies have a minimum 14-day cooling-off menstruation. This is the legal minimal, but some insurers will offer a longer one .
If you want to cancel during the 14-day cooling-off period, you might not have to pay a cancellation fee .

Cancelling your insurance when you pay monthly

You can besides cancel your car policy if you pay monthly. But you ‘ll normally end up paying flush more in fees.

That ‘s because most pay monthly car insurance policies do n’t in truth work the way they seem to work. It does n’t mean you pay for one calendar month ‘s policy at a time .
think of it more like a lend. Your insurance company covers you for a whole year, and then you pay it back in gradual instalments .
That ‘s why, if you add up each monthly payment, the total cost will be higher than if you ‘d paid for the whole thing up front. It ‘s a kind of interest, fair like with any other loan .
That all sounds a bite academic. But it ‘s crucial to understand it when you want to cancel a car insurance that you pay for month-to-month .
Because, when you cancel, the cancellation fees will be based on the number of months you have left on your policy policy – just like it would if you ‘re paying for the whole thing up front. So you ‘ll have to pay the same cancellation fee you would if you did n’t pay for your car indemnity month-to-month .
On top of all that, you ‘ll normally have to pay an extra tip, which is a percentage of the sum price of the policy .
( Again, this is n’t how our pay-monthly car insurance works. It ‘s not a loanword. That ‘s why you do n’t have to pay any fees to cancel. )
And you still have to let your insurance company know that you want to cancel. Cancelling your direct debit wo n’t cancel your car indemnity .
If you cancel your aim debit without cancelling your policy, your insurance company could cancel your policy for non-payment, and that could make it harder to get insurance in future .

Cancelling your car insurance because of Covid

If you want to cancel your car indemnity because of Covid, most policy will still charge you a tip. even if you ‘re not using your car anymore because of lockdown. ( We do n’t think that ‘s fair. That ‘s why we never charge cancellation fees. )
But you can talk to your insurance company, and you might be able to work soemthing out.

If you want to cancel your car insurance because you ca n’t afford it, you ‘ve got a few options. You can :

  • Switch to monthly payments, if you’re paying annually – just bear in mind this is usually much more expensive overall
  • Ask your insurer to delay your payments (some insurance companies are giving customers 28-day payment delays)
  • Cancel and pay the fees

Remember that if you do cancel, you might not get the same price when you set up your car insurance again. It could be a draw more expensive in future .
If you need car insurance with monthly payments that you can cancel anytime, take a expression at our pay-monthly car insurance. You can pause your cover whenever you like, and unpause it when you need insurance again. You ‘ll never have to pay a tip to do this .

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