Before cancelling your car insurance policy, think about the risks.
If you’ve gone to all the trouble of searching for the right car insurance quote, choosing a policy that suits you, and paying your premiums on time, then if you’re considering cancelling your policy, take a few moments to consider the risks and disadvantages of such a decision.
Typically, when you’re experiencing more month at the end of your money, you’ll start looking for ways to decrease or eliminate expenses. This ranges from cutting down on entertainment expenses, like takeaways and going to the cinema. But it can also extend to more serious expenses, like car insurance.
Before you cancel your policy, look at each of the risks in detail.
If your car is financed, you’ll be in breach of contract.
Generally speaking, a car financing agreement in this country requires you (the owner) to hold a comprehensive car insurance policy for the duration of the payment period. Once you’ve paid your loan off and your agreement is complete with the financial institution, you can cancel your policy.
Until then, if you cancel your car insurance, you’ll be violating the terms of your financing agreement. The consequences differ between financial institutions, but you could risk losing your car altogether.
Accidents just happen.
There’s a misconception that car insurance is more necessary for those more likely to have an accident, whether it’s because they live in a heavily congested area or simply aren’t the best drivers. But accidents are defined as incidents that happen unexpectedly and unintentionally.
Funnily enough, the quality of the driving behaviour doesn’t come into it. Yes, you can increase the likelihood of having an accident by driving badly, but a bad driver could go the whole of their driving life without ever causing or getting into accident.
The bottom line is that an accident, theft, fire, and hijacking are all events that can happen to anyone at any time. You could affect your future cover.
Some people believe that if they’re good drivers, they don’t need cover. However, if you keep your policy active and rarely claim, you’ll build up a low insurance risk profile. Over the years, you could very likely be rewarded with better premiums as a result.
Cancelling your cover regularly could put you in a higher risk category, which might mean higher premiums. In fact, some insurers may even reject your application.
The reality of paying out of your own pocket.
Driving an uninsured car and getting into an accident (whether it’s your fault or not) could end up costing you hundreds of thousands in damage claims. If you drive into someone accidentally, you’re liable for the cost of repairing or replacing that other car. Oh, and of course, your own. Added to this, the accident could also result in costly lawsuits being brought against you by the other driver or their insurer.
The final fee could easily come to six figures and you’ll have to foot the bill.
So, what can you do?
If you’re considering cancelling your car insurance to ease the pain and suffering of your budget, then it’s worth noting that you don’t need to cancel your policy to save money.
Make things more affordable:
- Downgrade from comprehensive to third party only or third party, fire and theft policy if your car is older old and paid off.
- Chat to your insurer about increasing your excess amount, which will reduce your premium, but keep in mind that you’ll have to pay the excess if you claim and need to be able to afford this amount.
- Consider moving your household and car insurance to the same company, who may offer you a discount for doing so.
As you continue your journey of cutting costs and searching for affordable car insurance, keep in mind that shopping around for and comparing quotes will help. During your search, you’ll find that top car insurance companies, like King Price Insurance, have done their best to give you a clear shot at getting and keeping comprehensive car insurance. King Price, for instance, is the first insurer to offer you premiums that start out affordable, and decrease every month in price, in line with the depreciating value of your car.
Contact King Price for car insurance quotes