How to Write a Cancellation Letter for Car Insurance Policy

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Here's what you need to know...
  • Writing car insurance cancellation letters are quick and easy
  • As a policyholder, you maintain the right to cancel at any time
  • It is important to have another policy set in place to avoid a lapse in coverage

People cancel their car insurance policy for many reasons including selling their current vehicle or not being able to drive any longer. They may even find better rates with another company.

This is especially true if you have moved to a different neighborhood. You may discover lower insurance price quotes for different areas.

Whatever the reason may be, it is important to follow the insurer’s guidelines to properly terminate your policy.

Some policies can be canceled over the phone with a customer service representative while others may require a 30-day notice and/or cancellation letter.

Policies are considered as contracts between the insurer and consumer and written cancellation letters are often required.

When shopping for car insurance, it is important to become acquainted with their cancellation policies before making a purchase.

Although writing a cancellation letter is very easy, you should be sure to include a few pieces of important information to properly cancel business with the insurance company.

Before canceling, make sure you have proper coverage in place.

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What Information to Include

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Your insurance cancellation letter should be short and to the point.

It should include the following information:

  • Name/Address of Policyholder
  • Name/Address of Insurance Company
  • Policy Number
  • Requested Policy Cancellation Date
  • Refund Request for Remaining Premium Balance

Be sure to include the names of any direct company representative at the top of the letter.

In the main paragraph, begin the letter by directly requesting the policy cancellation.

State that all charges for the policy must be terminated.

Next, state the date that you wish the policy to cancel. Request a refund of any overpaid premiums. If preferred, you can request a check.

When closing your letter, simply end the letter with a salutation such as “Sincerely.” Be sure to sign your name underneath the salutation, even if the letter has been typed.

Below is a sample of an insurance cancellation letter:

April 7, 2015

John Doe
1234 Main St
Springfield, Ohio 12345

Lizard Auto Insurance
54321 Broad St. Suite #100
Springfield, Ohio 12345

Attn: Cancellations Department

RE: Car Insurance Policy Number: 9236647

This letter as a formal request to cancel the referenced car insurance policy (9236647). Please stop all debits or charges for premium payments. The effective date of policy cancellation is 04/25/2015.

I am also requesting written correspondence of the cancellation and the refund of any premiums. The cash value of the policy should also be sent with any returned premium. This action needs to occur within a period of 30 days from the receipt of this letter.


John Doe
1234 Main St
Springfield, Ohio 12345

Be sure to check for spelling errors and verify all information, including names, addresses, and the policy number. Use business letter format when typing the letter.

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Tips to Remember When Writing A Cancellation Letter

Before you fold up the letter and send it off, keep a few things in mind:

  • Make sure you have the correct mailing address. The insurance company would not be held responsible for a document they did not receive. If possible, use a shipping method that provides a tracking number so you can know exactly when the letter arrives at their location
  • Include “cancellations” within the send-to address. Insurance companies are often large operations with many departments. You want to ensure that your letter goes exactly where it needs to
  • The main policyholder should be the only one to sign the letter. For example, if your relative is listed as a driver on the policy, he or she would not be authorized to sign the cancellation notice and the company may deny the request
  • Be professional, yet firm in your tone
  • Be sure to make two copies of the letter so you can keep one for your own records

Always Keep Car Insurance for Your Vehicles


If you plan to operate your vehicle, it’s important to ensure that it has coverage. Before you cancel, you should have a new policy set up and ready to go.

A lapse in your car insurance can cause you many problems.

Consequences of letting your car insurance lapse include:

  • Fines for driving uninsured
  • Responsibility to pay for all damages due to an auto accident that you caused
  • A record that shows the lapse and may result in higher premiums for future policies

Tying Up Loose Ends


Once you have successfully canceled your car insurance, you will want to take care of a few more things.

Contact your state’s DMV and notify them of the cancellation. This may be a requirement in some states. You may have to surrender the vehicle’s license plates and registration tags.

You may have to surrender the vehicle’s license plates and registration tags.

If your car is financed, you should notify the lienholder that you have changed car insurance companies.

Keep in mind that most finance companies require insurance coverage on financed vehicles.

If they discover that their vehicle is not insured, you will likely be asked to return it.


Canceling a car insurance policy is a relatively quick and easy process. As the consumer, you always have the right to cancel the policy at any time for any reason.

Establish the date you want it to end, request your refund for overpaid premiums and make sure you have another insurance company lined up to take its place if you plan to keep driving the car.

Once you have written the cancellation letter, you can either mail it or fax it.

Remember, though, if you’re still driving, you still need insurance. Compare quotes today using our free tool below.

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