Overhaulin'

will i get a fee for canceling my car insurance policy early?

Im a little confused and can use some help! I am in massachusetts and have a car insurance policy that goes from february to february. i got a great quote from another company and want to dump my current one. my insurance agency insists i wont get a fee for cancelling early, but the insurance company itself says that i will get a 10% fee of my total premium for cancelling. I don't want to be unpleasantly surprised with a bill, but im not really sure who is right, and if the insurance company is telling me i have a fee just to scare me out of cancelling. Thanks

Public Comments

1. Quite the contrary, simply sign up for the new policy and call your old carrior and tell them your swapping policy's they will reimburse you for the remainder of your prorated term. Remember..you paid for the full 6 month term up front...its not a cell phone...no early termination fee. Much love!
2. id expect a refund. theres no way you could own money for not having their insurance.. ask your new company if they will handle it,,,some do
3. look on the terms and conditions of your policy, they are all different depending on the broker and company. I would ask the agency to put the information they are giving you in writing and ask them where they are getting their information from.
4. Most of the times, you might have chosen the annual premium option and would have paid for the entire year. In case of replacement of the policy in between, you need to mention the same to your company or agent and request for a refund of the balance premium amount due to you. In such a case, the insurance company will arrange to refund the balance amount. For more info you can read this article http://www.assureinsure.com/article-how-to-cancel-auto-insurance-policy-229.aspx
5. In Canada they will do the following A - If your policy is paid in full, they will divide your total premium by 365 giving a daily coverage rate, and multiply that amount by the of days left between cancellation and scheduled renewal date (IE from now till February) then subtract about 30 days worth of a premium as a cancellation fee. They will cut you a cheque for the rest. B - If you making your payments via direct deposit, they will debit your account 1 month after cancellation for 10% of your total annual premium as a cancellation fee. If you wait untill your renewal date, there will be no cancellation charge. Also, be aware that when switching to another insurance company, that they all have different best practices that they use. As a result, some companies make your first payment a double payment. Add to that the cancellation fees from the last insurance company and it will feel like you're paying 3 months worth of your premiums.. Ensure that you have that much in your account before the withdrawal as you wouldnt want to be hit with a non-sufficiant funds charge from your bank to top it all off...