Planning To Cancel Car Insurance? – Here’s What To Know

Get Car Insurance starting at only ₹2,094/year #

Though rare, car insurance cancellations are pretty much evident in the motor insurance sector. There may be some reasons why one wants to cancel his/her car insurance policy after purchasing one. For instance, shifting to a new location or selling your old car may require cancelling your policy. But is this cancellation possible and easy? Let us decode this further in the article.

Read more

  • Renew policy In 2 minutes*

  • 20+ Insurers to choose

  • 51 Lakh+ Vehicles Insured

#TP price for less than 1000 CC cars. All savings are provided by insurers as per IRDAI approved insurance plan. Standard T&C apply.

Get Car Insurance starting at only ₹2,094/year #
Looking for Car Insurance?
Select your city or RTO
Search city or RTO
Can’t find your RTO? Search for it
Search Car Brand
    Search model for Maruti Suzuki
      Search for variant
        View all variants
          Please fill your details
          Your full name
          Email address
          Mobile number
          View Prices
          Please wait..
          By clicking on “View Prices”, you agree to our Privacy Policy & Terms of Use
          Select Make
          Select Model
          Fuel Type
          Select variant
          Registration year
          Registration month
          Save & update
          Please wait..

          Reasons Behind Car Insurance Cancellation

          As per the Indian motor rules, it is mandatory for every car owner to have a valid car insurance policy to drive legally on Indian roads. However, there may be situations when an insurer would want to cancel his/her four-wheeler insurance policy. Here are some most common reasons for car insurance cancellations:

          1. Selling a Car

            If you have purchased a long-term car insurance policy and choose to sell your car, then you must consider cancelling your car insurance policy. Even if you have purchased a yearly comprehensive car insurance policy and still have time left for expiry, you must cancel your old policy and transfer your car documents to the purchaser.

          2. Unhappy with Current Insurer

            Another reason for car insurance cancellation is if you are not satisfied with your current insurer and decide to go for a better option. In such cases, you need to cancel your car insurance from the previous insurer while changing your insurer.

          How to Cancel Car Insurance?

          Cancelling car insurance is a pretty easy process. If due to any of the reasons you are looking to cancel your four-wheeler insurance, follow the ways mentioned below:

          1. Inform the Insurer

            As soon as you plan on cancelling your car insurance policy, you must inform the insurer about the cancellation. You can get in touch with your insurance company via email or call and tell them to start the policy cancellation process.

          2. Take Their Guidance

            Before cancelling the policy, take the guidance of your insurance company as they will help you with the cancellation process. The insurer may ask you to submit a declaration stating the reason to cancel the plan. You may also need to sign a document for policy cancellation. Usually, this process is different for different companies, so make sure to talk to your insurer.

          3. Get the Certificate of Insurance

            Once your car policy is cancelled, the insurer will give you a car insurance certificate stating the details of the cancelled policy along with the accumulated NCB till cancellation. Make sure to collect this certificate as it will help you in claiming your accumulated NCB while purchasing a new car insurance policy.

          4. Check for the Refund Amount

            When you cancel a car policy midterm or soon after purchasing it, the insurer may refund you the premium amount based on the policy terms and conditions.

            • If you have cancelled the policy before the start of the policy, you are likely to receive a full refund.
            • If you have cancelled car insurance after the start of the policy, you will be getting a refund on a pro-rata basis as you have used your policy for some days.
          5. Don't Forget to Buy a New Car Insurance Policy

            While cancelling your policy, if you state the reason as ‘Switching insurer’, your insurance company may ask for a new car insurance policy. Thus, in any case, do not forget to buy a new car insurance policy from the new insurer. Even if you are selling your old car and purchasing a new one, it is mandatory to at least have a third-party insurance policy.

            If you have had an unsatisfactory experience with your previous insurer, make sure to compare third-party and comprehensive car insurance online from so that you can the best one this time.

          Long Term Car Insurance and Cancellation

          The cancellation of long-term policies that have a 3+1 year tenure will have standard conditions. Such policies shall have a free-look-up period of 30 days from the date of policy inception. If a policyholder has cancelled the policy within this look-up period, he/she will be entitled to a refund on a pro-rata basis.

          The long-term own damage policy can be cancelled during its tenure by giving the notice of cancellation. In such scenarios, the premium refunded will be:

          • A full refund of the future year's premium
          • For the year in which the policy has been cancelled:
            • If no claims are reported: Refund of pro-rata premium
            • If claims are reported: No refund of premium
          • GST and other govt. taxes to be refunded to the extent permissible by concerned authorities.

          Wrapping Up!

          Above we have mentioned everything you need to know about cancelling a car insurance policy. However, if you still face any issues, you may connect with your existing insurer. If you have purchased a policy from, you can connect with our 24*7 customer support executives.

          Find similar car insurance quotes by body type

          Hatchback Sedan SUV MUV
          Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.
           Why buy from policybazaar

          Car insurance articles

          Recent Articles
          Popular Articles
          How Long Can You Wait to File a Car Insurance Claim?

          22 Mar 2023

          When an unanticipated road accident occurs, filing a car insurance
          Read more
          How to Transfer Car Ownership Online?

          20 Mar 2023

          A car's ownership is usually transferred if the car is sold to a
          Read more
          About Hybrid Cars -Types, Advantages, Hybrid vs Electric Car

          16 Mar 2023

          Due to their diverse benefits such as lower fuel economy and low
          Read more
          Vehicle Scrappage Policy in India: All You Need to Know

          15 Mar 2023

          With an aim to phase out unfit and polluting vehicles, the
          Read more
          Planning To Cancel Car Insurance? – Here’s What To Know

          28 Feb 2023

          Though rare, car insurance cancellations are pretty much evident
          Read more
          Check Car Insurance Status Online on Parivahan Sewa/ RTO?
          It doesn’t matter if you are an excellent driver or take your car out only once in a few months, your car must be
          Read more
          Getting Your Duplicate Car Insurance Policy is Easy-Here’s How!
          Losing your car insurance documents can be daunting. In such a state of affairs, the first thing that comes to your
          Read more
          How to Find Car Insurance Details by Registration Number?
          As a car owner, it is mandatory to have a car insurance policy under the Motor Vehicles Act, 1988. Sometimes, you
          Read more
          Multiple Ways To Check Your Car Insurance Status Online
          With everything going digital, checking vehicle insurance status online has become easier than ever. It not only
          Read more
          Transferring Car Insurance from One Person to Another
          An integral part of selling a car, for both the buyer and the seller, is ensuring a successful car insurance
          Read more

          View Plans
          Download the Policybazaar app
          to manage all your insurance needs.