A few things to consider before cancelling your car insurance

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The decision to cancel a car insurance policy should not be made lightly. There are many factors to consider, and some could have a significant impact on your financial future.

It is important to make an informed decision and to know the risks involved in cancelling a car insurance policy before you make the call. Here are a few tips to consider:

  • If your car is financed by a bank, it’s a requirement in terms of your credit agreement with the bank that your car is insured for the duration of the finance term. Usually this means that the bank can buy insurance on your behalf, without your input and add the premium to your car payment.
  • Did you know that if you have a lapse in coverage, insurance companies may place you into a higher risk category and your new premium could be higher?
  • Accidents happen and if you choose to self-insure, this could be financially devastating.
  • If you’re switching insurance providers, make sure to set up your next policy before you cancel your current one.
  • If you’re cancelling because you’ll no longer have a car, make sure you have insurance all the way up and until you no longer carry the risk of loss or damage. You’ll get your money back for your pre-paid premiums from when you cancel your insurance policy.
  • Cancelling car insurance because you barely drive? Even if you rarely get behind the wheel, you still need insurance – it’s an essential form of financial protection. If you rarely drive, you may qualify for certain discounts on your car insurance. Be sure to check with your current insurer.
  • If you are looking for cheaper insurance, before you go quote shopping, know that there may be an even easier way to get lower rates: Ask your current insurer. Some car insurance companies may be open to revisiting your rates and coverage to suit your budget if you have an existing insurance history with them, so that should be your first step.
  • If you have received a few quotes, it’s important to compare ‘apples with apples’. Check if your vehicle tracking device and emergency assistance benefits are included in the new quotes. Life saving features such as automatic crash detection and dispatching emergency medical and roadside assistance, whilst it may cost a bit more, is a priceless benefit when you need it most.

We trust that you found the above helpful. Our Personal Portfolio Consultants are on standby to assist with quotes, policy queries or assist you in revising your premiums and cover options.

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