Did you just recently sell your car and now you need to know how to cancel your car insurance properly? It is important to be aware of all of your options before you act on something. For instance, maybe it’s time for you to upgrade your car insurance or maybe you want to explore other coverage options. Either way, you will want to talk to your insurance agent to have them clarify all of your options. They will also give you insight on how to cancel your car insurance.
What Are The Steps To Canel My Car Insurance?
So, what are the steps I need to take to cancel my car insurance? Let’s take a look at the entire process as well as the right time to do it. As you know, car insurance is a way to protect yourself and other drivers from financial loss in the event of a car accident. Additionally, it is a requirement in the majority of states to drive legally on the roadways. However, when you sell your car you will need to cancel your insurance or transfer it over to your new car. Listed below are some steps to keep in mind when you are going through this process.
Contact your insurance agent
The first thing you will want to do is call your insurance agent to gain some insight into your specific situation. They will be able to help you determine all of your options and help counsel you in the right direction. Now, the actual process of canceling your car insurance is simple, but it definitely involves a conversation with your insurance agent first to make sure everyone is on the same page. Additionally, every insurance company has its own policies and different processes. You want to talk to your specific agent so they can help you with your current situation.
When you call your insurance agent, you will want to first tell them that you sold your car. Then you want to ask them if there are any penalties for canceling your insurance such as a cancelation fee. It is very important to ask questions like this because they may not tell you of these fees. You want to understand the entire picture before you do anything, so ask every question possible so you know exactly what you are facing before you cancel your insurance.
Furthermore, some individuals just assume that insurance companies know when you have sold your car. This is not the case though. Even though you are signing your name on the transfer of ownership slip, you still need to contact your insurance company. The information is not automatically transferred over. It is completely your responsibility to let your insurance company know that you sold your car.
Inquire about a vehicle replacement
Once you have told your insurance agent that you sold your car and talked about the basics of canceling your insurance, ask them about their vehicle replacement policy. Essentially this means that instead of canceling your current policy you would keep it and transfer it to your new car. Often this is a more convenient option because you don’t need to start a whole new policy you can continue on with your old one.
If you are going to inquire about this option, you will need the make, model, VIN, and year that your new car is. Your insurance agent will need to know the exact details of your new car so they can transfer the policy and reconfigure new numbers. You will want to make sure that information is handy while you are on the phone with your insurance company.
Align your dates correctly
Typically if you decide to sell your car then you will be purchasing a new car. If you don’t want to have a lapse in your coverage then you will want to try your best to align your date of cancellation with the date of your new insurance to make sure you are always insured. This is just another factor that you want to be aware of and mention to your insurance adjuster. They will be able to help you and give you advice on what to do.
You might not need to worry about this if you are able to just transfer over your current insurance to your new car, but you definitely need to communicate this to your adjuster. Don’t ever hesitate to ask questions these are important factors that will affect when you cancel your current policy.
Submit a cancelation request
Another thing to be aware of is that most insurance companies will require you to submit a written statement verifying that you want to cancel your insurance policy. So, what does this mean? You will need to print out the form requesting the cancellation, sign it, and then mail it to your insurance agent. Once they have received this document then they will be able to cancel your policy.
As you can imagine, mailing in this document can take a few days and slow up the entire process. You want to make sure you account for enough time for the documents to get to your insurance agent. Additionally, you will want to make sure that your insurance agent has your correct mailing address. If there are any refunds they will mail them to the address that they have on file. You can always ask your insurance agent if you will be expecting any refunds for canceling your policy.
Other Steps To Take After Selling Your Car
It is crucial that you know all of the steps involving canceling your policy but there are also other things that you should be aware of to free yourself of liability. Once your car leaves your driveway you want to make sure that you don’t have any liability attached to your name.
Sign a bill of sale
The first thing you want to do is make sure you sign a bill of sale. This document is a legal document that officially transfers ownership of your car over to the individual you are selling it to. Essentially it is similar to a contract and both parties have come to a mutual agreement to make this sale. Typically you will be able to find a bill of sale on your state’s DMV website. All you need to do is print that out and have the other party sign.
You will want to read through to document to make sure you include all of the necessary information required by your state. Typically they will want you to include your car’s current odometer reading. You also might need to get this document notarized so make sure you are aware of all of the requirements. Each state was its own rules so you will need to be aware of your states to make sure you complete the document correctly.
Complete a release of liability
A release of liability form is exactly what it sounds like. This document frees you of liability for the vehicle. This means that once the new owner takes your car and signs these documents you are not liable for any potential problems or accidents that this car is involved in. It is critical that you release yourself of any liabilities.
Additionally, this form will notify the state of the sale and inform them of who purchased your car. This will also protect you in case the individual who bought your car doesn’t transfer the vehicle registration. You will want to make sure you have this document handy in case any issues like this arise after they have taken your car from you. The last thing you want is to be involved in a situation where you are held liable for something you didn’t do relating to a car you were not driving or don’t even own.
Before they take your car away you will want to make sure you remove the license plate. This belongs to you and you don’t want any traffic incidents or violations to be recorded under this plate with the new buyer driving. You also want to make sure you give them all sets of keys that you have for this car as well as the service history and car’s handbook. You don’t have a need for any of this after you get rid of your car so you want to make sure the new owners have access to everything.
As you can see, there is a lot more to this process than just going online and canceling your insurance policy. You want to make sure that you protect yourself from any surprises. The best way to do this is by calling your insurance agent and telling them your situation and asking them any questions you might have. You also want to be as transparent as possible with the new car owners to make sure no issues fall back onto you after your car leaves your driveway. This entire process can definitely be stressful and overwhelming but start with calling your insurance agent to get all of the details involved with canceling your insurance policy after selling your car.