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How to Cancel Car Insurance
How to Cancel Car Insurance
Written by
Kervin Mathew
Edited by
Ellie Garran
Reviewed by
Adrian BennettCompare car insurance policies the easy way
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Long story short
Most insurers let you cancel your car insurance at any time
Just expect the cancellation process to include a few fees and formalities.
Some insurers may charge you if you cancel before the policy term ends
If you’re outside your cooling-off period, you’ll likely cop a fee – but if you wait until renewal time, it’s generally waived.
You might get a pro-rated refund of your unused premium if you’ve paid annually and haven’t claimed
If you pay in instalments, you might need to pay any remaining premium you owe at the time of cancellation.
Can I cancel my car insurance policy?
If you’re thinking about cancelling your car insurance, there may be heaps of questions in your head, one of them likely being: am I allowed to cancel?
Well, the short answer is yes. You can cancel your policy any time you want to. You may even get a full or partial refund, depending on when you cancel and whether you’ve paid up-front or in instalments.
That said, things like outstanding premiums, cancellation fees, and non-refundable charges might cause a couple of bumps in the road before your cover comes to a complete halt.
How do I cancel my car insurance?
Cancelling a car insurance policy can feel a lot like ending a relationship. While the ‘break-up’ process may vary slightly between insurers, you’d generally follow these steps to call it quits.
Review the cancellation policy
There’s no real closure without some product disclosure! Your policy’s product disclosure statement (PDS) should give you the general need-to-knows and exclusions when you cancel car insurance – we’re talking refunds, cancellation fees, and so on.
Break the news to your insurer
Luckily, insurers are gracious about you calling things off over the phone or online. This might be a good time to leave no stone unturned and clarify any burning questions you may have regarding open claims or refund amounts, if any.
Confirm the cancellation
When all is said and done, you might as well make things official by asking for confirmation that the policy is cancelled – just in case you need to prove that you’re no longer ‘committed’ to the policy. The insurer may provide this in writing either by email or post.
Helpful tip
Moving on from an insurer is sometimes for the best. Sure, you might be tempted to freewheel it for a while without a care in the world, but you don’t want to be in a bingle regretting your decision to cancel your cover. So instead of cancelling and being uninsured, why not simply upgrade to a policy that’s a better match – like a pay as you drive policy that’s designed to be easier on the pocket? With iSelect, you can compare car insurance policies from our range of insurers and switch in just a few minutes.
Adrian Bennett
General Manager for General Insurance
Will I have to pay cancellation fees?
It hinges on when you cancel your car insurance.
If you cancel your policy outside its cooling-off period or any time before your policy renewal date, you might need to cough up a cancellation fee. Generally, you won’t be charged a cancellation fee if you decide not to renew your policy.
Will my unused premiums be refunded?
Depending on your insurer, if you’ve paid for a year up-front, you might get a refund of any unused portion of your premium. Say you cancel six months into a typical one-year policy, you may get a refund for the remaining six months. But if you pay your premium by the month, you might need to pay any remaining premium you owe at the time of cancellation.
It might also help to know about non-refundable charges such as duty and taxes. The product disclosure statement (PDS) is a good place to start if you want to understand how refunds work for a policy.
Why might I want to cancel my car insurance?
You sold your car
Maybe you’ve gone electric, swapped four wheels for two, or you’ve put your faith in public transport.
Your car’s in the shed
It could be long-term repairs or an ambitious project that’s going to keep your car off the road for a few months.
You’ve moved overseas
Safe to say your car insurance likely won’t cover you outside Australia, which is reason enough to cancel.
You’re moving to your partner’s insurer
In the spirit of what’s yours is mine, you might decide to grab a multi-car policy with your partner’s insurer.
Frequently asked questions
How long does it take to cancel a policy?
It will likely take a few minutes to cancel your policy over the phone or online. Typically, your car insurance cover ends on the day you request its cancellation.
Can I cancel car insurance after a write-off claim?
Yes, you can cancel your car insurance policy at any time, even if you’ve made a write-off claim. That said, if you’ve made a write-off claim, you might not be entitled to a refund of your premium.
What is a cooling-off period?
A cooling-off period is a limited period that starts from the moment you buy your policy and generally lasts between 14 and 30 days. It’s generally a good idea to take this time to consider whether or not you want to stick with the policy or switch to something better.
If you cancel your policy during the cooling-off period, you’ll get a full refund of your premium and you won’t have to pay a cancellation fee – just like starting afresh! But there is a catch – if you make a claim during the cooling-off period you’re effectively forfeiting the feature.
Things not working with your insurer?
If you’re keen to move on, we can certainly help speed things up. Try our online comparison tool to explore policies from our range of providers and match yourself up with one.
Get started on comparing car insurance policies!
Save time and effort by comparing a range of car insurance quotes with iSelect
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