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Can I get an insurance refund if I cancel?

If you're thinking about cancelling your insurance, you'll want to know where you stand financially. You can get an insurance refund if you cancel your policy but there are penalties to pay and other items in the small print to be aware of so don't make the mistake of thinking you're in the driving seat when you get a new policy.

14 day cancellation period

If you've only just taken out your insurance policy and you took it out over the phone or through the web, you're covered by Financial Services (Distance Marketing Regulations) 2004. These regulations give you a statutory 14 days cancellation period during which you can serve notice that you no longer want the insurance without suffering any penalties, as long as no claims have been made. You be expected to pay for the insurance cover provided during that period but nothing else.

Cancelling insurance

Once the cooling off period is over you can still cancel your insurance but it's not as straight forward. Most insurers allow you to cancel your insurance as long as you pay a cancellation fee. If you're thinking of cancelling because you've found a better deal, you'll probably find this uneconomical but if you need to stop the cover, for example if you can no longer drive and want a rebate on your car insurance, at least insurers allow this. If you've paid your premium in full, you'll get an insurance refund. If you're paying in monthly instalments, you'll be asked to make a final payment to bring you up to date. Your best bet is to call your insurer and discuss the details with them.

Final thoughts

Unless you're leaving the country or you find yourself with an insured vehicle you can no longer drive and need a car insurance refund or you move from a property you own into rented accommodation and have buildings cover that's no longer needed, there really aren't that many reasons why an insurance refund is required. Insurers don't want you to leave, but they can't stop you if you want to.

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