Is It Possible to Cancel A Car Insurance Policy? What is The Process?
As per the Motor Vehicles Act of India, 1988, it is mandatory to have a car insurance policy for every car owner. If a person has more than one car, he or she should obtain insurance coverage for every car he is owning. Driving without car insurance is a punishable offense. Not only does car insurance saves you from penalties, but it also safeguards you from huge expenses involved in repairing your vehicle due to accidents, medical expenses in the case of severe accidents and so on.
An important question that often comes in the mind of people while purchasing car insurance is can I cancel car insurance? The answer to this question is yes!
There are many reasons for opting to cancel the car insurance policy. You might want to cancel your car insurance because you sold your own car and planning to buy a new one or your car might have got stolen. Sometimes, the insured is not happy with the services of the existing insurer and prefer to buy a new one from another insurer. One might want to buy a policy with a low premium amount as the current premium amount is difficult to afford. Whatever may be the reason behind the cancellation of car insurance, the procedure for cancellation is the same in all cases.
How to Cancel Car Insurance Without Charges?
One can cancel the policy whenever he wishes to. One should remember that motor insurance policy can be cancelled if you have an alternate policy in hand. If the policy (Risk) has started, he will only get the refund on pro rata basis.
How to Cancel Car Insurance?
The detailed procedure for cancellation of car insurance policy is as under:
Update your Car Insurance Provider
The first and foremost step towards cancellation of a car insurance policy is to intimate your insurance provider and submit the car insurance certificate. Because the cancellation procedure will be initiated by the provider itself. The cancellation procedure involves certain formalities.
Complete the Formalities as Instructed by the Insurer
Cancellation of car insurance policy involves certain formalities. These formalities vary from insurer to insurer. Once the cancellation process is initiated by the insurer, they will guide you through the process. You need to follow the instruction given by the insurer and sign on the cancellation documents. After the completion of the formalities, you will be provided with a cancellation letter from the insurer.
Collect your Car Insurance Certificate
Once the cancellation is completed, ask your insurer to return the car insurance certificate that was submitted at the time of making the cancellation request. The car insurance policy may be required at the time of applying for a new car insurance policy. This certificate also safeguards your No claim bonus.
Make Sure to Receive the Refund Amount Before the Policy lapses
Do check for refund on your policy. It is very likely that you might be entitled to receive a refund amount if you have paid the annual premium amount and the policy has some time left to expire. Ask your insurance company about the refund amount and make sure you receive the amount through proper means before the policy lapses.
Apply for a New Policy
If you have cancelled your policy because you sold your car then make sure to apply for a new one when you buy a new car. In case you have cancelled the existing policy to apply from a different insurer then do it immediately after the cancellation of the previous one.
Cancellation of a car insurance policy is a simple step, which requires a few formalities. As already mentioned, the formalities might slightly vary from insurer to insurer. Hence, it is always recommended to read the policy papers carefully to learn the terms and conditions of the cancellation.