Cancelling your policy

Cancellation of insurance policies is a common occurrence. However, it is of benefit to both the customer and insurer if it is done the right way.

There are several reasons that people have given for cancelling policies including: inability to pay premium; they did not know what they were signing up for; they were convinced by a friend, family member or even an insurance agent or broker to cancel; the insurance cover was no longer meeting their needs; they were unhappy with the customer service among others.

Giving honest feedback to your insurer when you cancel your policy will help them make their processes better going forward.

Here are some things to consider before cancelling your policy.

  • When you are not able to pay your premiums

Life happens and sometimes, meeting some financial obligations such as insurance premium becomes a challenge.

Instead of just defaulting on payments, it is important to speak to your insurer first to understand what options are available for you.

  • When you did not understand what you were signing up for

This is also a common thing, but before cancelling, seek out the insurance company, agent or broker and ask the questions you still have. This may result in you keeping the policy or you cancelling the policy and taking another that addresses your needs.

  • When someone convinces you to cancel your policy

Always have in mind the valuable thing you are protecting with the insurance. Does the person trying to convince you otherwise have your best interests or are they pushing their own interests?

  • When the insurance cover is no longer meeting your needs

Express the same to your insurer, agent or broker and you could either tweak the policy to include your needs, or change to a policy that covers your needs.

Cancelling your Policy
If you have made the decision to cancel your policy;

  • Communicate formally to the insurance company, agent or broker and return the original or duplicate certificate (for car insurance) or Policy for other types of insurance.
  • Depending on when the cancellation happens and the type of cover, the insurance company may refund you the premium for the remaining period of insurance based on the applicable rates.