Why Do Car Insurance Companies Cancel Policies? – Kelley Blue Book
It can be nerve-racking to get a car insurance cancellation poster from your insurance company. After all, it ’ south illegal to drive without policy in most states. And without coverage, you could be on the hook for accident-related medical bills and fomite price .
fortunately, there are some things you can do to help prevent a cancellation. And if your policy does get canceled, there are ways to get new coverage .
Can They Really Cancel My Policy Without Asking?
Your insurance caller can cancel your policy, but they have to provide written notice before they do. The measure of clock time they have to give you varies by state. If you have questions about policy cancelations, it ’ s a adept idea to check with the department of indemnity in your department of state.
Unlike a non-renewal, which entirely occurs at the end of the policy term, cancellations can occur at any time. Non-renewals may happen for many reasons, which might include excessively many moving violations, a change in your citation, and filing besides many claims. But cable car indemnity cancellations can typically merely occur for a few reasons .
Why Do Companies Cancel Policies?
In general, policy companies can cancel your policy for any reason during the beginning 60 days the policy is active. however, they don ’ thymine typically delete policies for no reason. It ’ randomness normally because the hazard you present to the insurance company has changed since you applied .
Common Reasons Why Policies Are Canceled
Laws vary by state, but if your policy has been in effect for more than 60 days, there are normally only a few reasons an insurance company can cancel your policy mid-term. They may include :
- You didn’t pay your bill. Insurance is no different than any other service you pay for. If you don’t pay your bill, it will be canceled. Most insurance companies offer a grace period — usually 30 days — following your payment due date. If you bring your payments up to date during the grace period, the insurance company will typically keep your policy active.
- You lied. This includes lies of omission as well. If you weren’t (entirely) truthful when you completed your application or filed a claim, your insurance may be canceled.
- Your license was suspended or revoked. States can suspend and revoke licenses for multiple reasons. Examples include driving under the influence of alcohol or drugs, having too many points, and having unpaid parking tickets. If the state suspends or revokes your license, your insurer typically has the right to cancel your policy.
- Your health status changed. If you were diagnosed with a medical condition that makes it unsafe for you to drive, the insurer may be able to cancel your policy.
What to Do if Your Policy is Canceled
The foremost thing to do after receiving a car insurance cancellation notice is to contact your insurance company. Depending on the circumstances, they may be willing to reconsider. If they won ’ t, you should start shopping for new coverage right away .
You can start your search with traditional insurers. But if you ’ re unable to find coverage, you may have to check with companies that specialize in insuring bad drivers. And if you still can ’ triiodothyronine get indemnity, you might need to check out your state ’ randomness assigned-risk insurance pool. Insurers that participate in these pools must accept drivers the department of state assigns to it, no topic how much of a gamble they present .
careless of where you get insurance, you don ’ triiodothyronine want to let your policy sink because it could leave you exposed to fiscal losses if you ’ re in an accident. Plus, it sets off a chain reaction of events that might include :
- Fines if you’re caught driving without insurance
- Higher premiums when you get coverage again
- Suspension of your vehicle registration
- Repossession of your car if you’re leasing it or have an auto loan
How to Get Reinstated
If your policy caller cancels your policy because of non-payment, you may be able to get them to reinstate it. It ’ s typically easier to have the policy reinstated if you ’ re within the grace period and it hasn ’ triiodothyronine lapsed even. If your policy has lapsed, it ’ ll be tougher. But the rules for reinstatement deviate by insurance company, so it may be worth a call to your insurance company .
If you received a car policy cancellation poster because you haven ’ deoxythymidine monophosphate paid the premium, contact your insurance company proper away. They may be uncoerced to reinstate your policy if you pay what you owe, plus interest and fees that accrued .
If the indemnity company agrees to reinstate your policy, you might have to sign a imprint that says you didn ’ thymine have any losses during the deck period. And you agree not to file any claims with the policy caller from incidents that occurred during that time. Having the insurance company reinstate your policy is typically the best option because you maintain continuous coverage, and you don ’ t have to search for a newfangled policy. hush, your insurance company may raise your rates.
Read more: The Best Car Insurance Companies for 2022
How to Avoid Your Policy Getting Canceled
There are things you can do to help prevent a car insurance cancellation .
- Pay on time. If you know you won’t be able to make your payment, contact your insurance company right away. They may be willing to work with you to set up a payment plan so you can keep your coverage active.
- Tell the truth. Don’t try to hide things from the insurance company to get a lower rate or make it look like you weren’t at fault for a claim.
- Follow the rules. Don’t give your state a reason to suspend or revoke your license. Reckless driving and driving under the influence of drugs or alcohol aren’t the only infractions that may lead to the suspension of your license. Your state might also suspend or revoke your license for not appearing in court, not paying fines, leaving the scene of an accident, and more.
If you receive a cable car indemnity cancellation notice from your insurance company, find out if you can have your existing policy reinstated. If not, you ’ ll need to find newfangled coverage quickly indeed your policy doesn ’ deoxythymidine monophosphate relapse .
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