Some people think the best way to cancel an insurance policy is to just stop paying on it. The policy cancels and you don’t have to have any awkward conversations with someone at the agency. While it might be uncomfortable to call your agent to cancel your policy, it is by far the better way to handle things. You see, when you stop paying on a policy that should be getting paid, your insurance doesn’t just cancel, it lapses for non-payment. When you apply for any insurance policy, one of the questions on the application is whether or not you have had an insurance policy lapse for non-payment in the past 5 years. If you let a policy lapse and then answer that question ‘no’, you would be providing incorrect information on your application. If you answer ‘yes’, you may receive less favorable rates or be declined, neither of which are desireable outcomes.
Instead of canceling for non-payment, the best way to handle a cancellation is to contact your insurance agent and provide a signed and dated cancellation request. This way there is a paper trail and everyone can be on the same page.
Please contact us at (248) 531-8300 if you have questions about this topic or anything else insurance-related!
Levin Insurance Agency – Many Options, Once Choice