Cancel car insurance: how and when to do it?

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Canceling car insurance is a quick and easy process as long as it is done on time and in the indicated manner. Through this complete guide, discover the terms, conditions, and the model letter necessary to cancel your car policy correctly.

When can you cancel car insurance?

The first thing you have to keep in mind before canceling car insurance is that you CAN NOT do it whenever you want, with rare exceptions.

The deadline to cancel car insurance is 30 days before the expiration date of the policy. By the provisions of the Insurance Contract Law since 2016, as an insured you have to notify your insurer before this limit, otherwise, the policy will be automatically renewed. However, you should know that there are some reasons for canceling car insurance after the deadline. 

Communication must be done in writing, with fax, burofax or certified letter being the preferred channels, although certain car insurance companies allow it to be done by phone or through their website.

Sample letter to cancel car insurance

Few insurers offer a sample letter to cancel car insurance. Of course, its purpose is to solve problems before resorting to cancellation.

Given this, from Selectra we offer you a cancellation letter model with all the sections that have to be included.

To the insurance company:

(include name and full address of the insurer)

Full name of the insured and DNI XXXX

Subject: Policy cancellation

Policy number: XXXX

At (insert place) to (insert date)

My very gentlemen:

I hereby communicate my desire not to renew the reference policy that expires on (indicate the expiration date) and that I have subscribed with the company, complying with the one-month notice period, this being the date on which I want the cancellation requested to be effective.

Likewise, I request the cancellation of the direct debit and that no more charges be made to my bank account.

Please confirm the processing of this request.

Yours sincerely,


Signed:_______________ [Name and surname]

Following art. 22 of Law 50/1980 of the Insurance Contract: “The parties may oppose the extension of the contract using a written notification to the other party, made one month before the conclusion of the current insurance period”.

Cancel car insurance before the expiration date

As we have already mentioned, there are exceptional situations for which you can give car insurance before the expiration date:

  • The insurer modifies or eliminates the coverage or the price of the policy. In this case, the insurer has to notify you in writing. You will have 15 days to accept or reject these new conditions of the contract. If you opt for the no, logically you will not have to notify the company 30 days in advance
  • Change in driver risk requirements. The best example is a new driver who stops being one. In this case, the price of the premium will be lower and you must notify the company. If the latter ignores it, does not reduce the amount when renewing the policy, or does not pay you the difference, you can cancel the insurance within 15 days of notification

Other options you consider yourself an indecisive person, before taking out an annual policy, you may want to try car insurance for days, car insurance for weeks, or car insurance for months.

Cancel newly contracted car insurance

Another situation that can occur is that you have taken out car insurance and after a short time you realize that it is not the most appropriate for you. The reasons may be several but in any case, you have to meet these two requirements:

  • Requirements to cancel a newly contracted car insurance
  • Having contracted the insurance online
  • Notify the company 14 days maximum from the date of hire. Likewise, it is also necessary that you notify the insurer in writing.

If you meet these two requirements, they will not be able to impose an economic sanction on you. However, as in the previous cases, it is recommended that you keep a copy of the document in case you have to make a claim.

Mistakes when canceling car insurance

The most common mistake, if you want to cancel it, is to return the car insurance receipt. It is the ‘most comfortable’ solution, thus avoiding paperwork and notifying the company, but far from seeming an advantage, it can bring significant inconveniences.

  • Problems for not paying car insurance
  • They include you in the list of defaulters (ASNEF, among others). If they opt for this decision, it is more than complicated for another company to approve the hiring of one of their car insurance policies. Many specify in the particular conditions of the policy that it is a reason to give the automatic NO
  • They claim the money via court

On the other hand, it is possible that you are going through a financial downturn and cannot pay your car insurance premium. In this situation, the company is not obliged to make the coverage of the policy effective if you suffer a mishap or accident.

Frequently asked questions about canceling car insurance

When should I cancel car insurance?

There are several situations, but if, for example, you have bought a new car, you have sold the old one or it has not passed the ITV, it may be convenient for you to cancel your car insurance.

How can I cancel car insurance if I have contracted it through a brokerage?

In general, after you communicate your desire to cancel your car insurance to the company, the latter will inform the insurance broker.

Is canceling car insurance the same in all companies?

Yes, the normal thing is to have to send a letter informing of the decision. What can vary is the number of ways you can send it. Also, some allow you to cancel it by calling the customer service phone number.

By Cary Grant

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