Are car insurance cancellations and non-renewals the same?  The ultimate result is the same for the insured since the policy coverage ends, but they’re not the same.  The reasoning behind them is somewhat different.  Non-renewals result once a carrier’s underwriting guidelines are not met or are exceeded; for example, “insured has 3 accidents within the past year exceeding underwriting guidelines.”

 

Cancellations typically result from the insured’s behavior, such as not paying their premium.  Here’s some more info to help explain.

 

 

 

Contact Solo Insurance® for more information about car insurance savings or to get a quote.

 

Cancellations

A cancellation happens when the coverage stops before the end of the policy term.  Many people don’t realize that car insurance companies have the right to have a probationary period of the first 60 days that allow cancellations at the option of the Insurer.  If a policy has been in force over 60 days, it can still be cancelled for reasons stated in the policy terms.  Whether within the first 60 days or later, most cancellations happen due to the insured’s actions.  Sometimes cancelled policies can be reinstated.  This varies by situation, carrier and/or state.

 

The top reasons for the auto insurance cancellation are:

·         Non-Payment…if you don’t pay your premium before a cancel date your policy lapses at 12:01 a.m. on the cancel date (some carriers will non-renew you for too many late payments, see below).

Ø  Great ways to avoid this: pay early or on time.  Consider automatic payments or paid in full as options to save money and cancellations.

·         Your driving privileges have been suspended or revoked…since you are not legal to drive, many carriers will cancel the policy.

Ø  Great ways to avoid this: the obvious is don’t drive in such a manner that opens you up for tickets/accidents.  Another thought is to consider attending a traffic school or trying to have the ticket amended to a non-moving violation to reduce the number of points on your driving record.

·         Misrepresentation or fraud on your application…besides outright lying about address and drivers, fraud could include things you didn't think were a big deal.  It could be that you really do drive for a transportation network or do deliveries of food or packages.  It could be conveniently forgetting to include a high-risk driver on your policy.  Another big one is not telling your carrier that you use your vehicle for your job, not just to/from.

Ø  Great ways to avoid this: accurately complete your application and update your agent whenever there is a change in your circumstances.

 

Please note:  Multiple cancellations in a person’s car insurance history can become problematic for certain carriers.  They show the intent of the insured to not keep their policy.  A history of cancellations can end up costing more in the long run.

 

Non-renewals

Non-renewals happen in two ways:  when a car insurance company decides to part ways with the insured at the end of the policy term or the Insured non-renews the policy by not paying the renewal payment.  Nonrenewals are different than non-pay cancellations because the entire term of insurance contract has been fulfilled/completed.

Insured non-renewal comes from not making the renewal payment (remember if you’re on an automatic payment plan, you will also automatically renew).

 

In company non-renewals, car insurance carriers must give advance notice to their insured and explain the reason for the non-renewal.  Each state has their own laws for the number of days of notice required.

 

Here are some of the top reasons for auto insurance non-renewal:

·         Too many accidents, incidents or losses.  Or, on commercial vehicle policies, employees have too many accidents or moving violations on their records

·         Move out of state

·         Insurer no longer provides the type of coverage, discontinues an underwriting program

·         Insured failed to provide essential information requested by the insurer

·         Insured provided false information in the application

·         Driver’s license status has changed to suspended or revoked

·         One or more DWI/DUI

·         Insurer is withdrawing from the market

·         Health situation changes that affect driving, such as seizures or heart attacks

·         New vehicle exceeds what the company insures

 

Just because you’ve had a non-renewal from one insurer it doesn’t mean another won’t accept your business.  Your car insurance agent should check the other carriers for you, if they represent more than one.

 

The result is the same, no insurance, but the reasoning behind cancellations and non-renewals are often different.  If you get a notice you do not understand, simply talk to your insurance agent, as soon as possible, for an explanation.  Sometimes cancellations and non-renewals can be prevented by complying to an insurance company’s request for information, excluding an unacceptable driver and such.  This is why it’s important to talk to your agent to see why it’s happening and if it can be resolved.

 

Contact Solo Insurance® for more information about car insurance savings or to get a quote.

 

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Solo Insurance® where great rates and service meet.

We shop the rates for you upfront and at renewals, always making sure you are with our best rate for your insurance needs.

 Great car insurance at cheap car insurance rates.  

Like us on Facebook, follow us on Instagram and Twitter @thesoloins. 

 

Solo Insurance®  800-207-7656  Get a Quote: https://www.soloinsurance.net/

– Veteran/Family owned since 1994 –

 

Posted 12:40 PM

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