Car insurance cooling-off periods: what you need to know

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When cooling off periods start
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A cooling-off period is a window of time you get to change your mind after buying something.

By law, a lot of products have to offer you a cooling-off period. Car insurance is one of them.

If you’ve just bought a car insurance policy, here’s everything you need to know about your cooling-off period.

Even if you cancel during your cooling-off period, you can still be charged a cancellation fee

If you want to cancel a car insurance policy early, you usually have to pay a cancellation fee. Different insurers charge different fees.

If you cancel during your cooling-off period, you might still have to pay a fee - but it’s sometimes lower than it would be after the cooling-off period.

You’ll also be charged for the time you were covered

When you cancel car insurance, you’ll get a refund on any payments you’ve made (as long as you haven’t made a claim).

But your insurer will keep some of the refund to cover the time you’ve been insured. Plus a bit more for the cancellation fee (if you need to pay one).

This applies during the cooling-off period, too. If you pay for the whole year up front, and you cancel after a week, you’ll get a refund for the cost of 51 weeks’ insurance. (Minus any other fees you have to pay.)

Cooling-off periods can start at different times

Cooling-off periods vary a bit between insurers. But it’s usually 14 days from either:

  • The date your policy starts, or
  • The day you get your policy documents

Most of the time, it’s whichever of those two things is later.

You can check when your cooling-off period starts in your policy documents. It’s usually listed under a section called something like “Your right to cancel”.

You won’t be charged if you cancel before your policy actually starts

Cooling-off periods kick in when the policy starts, but car insurance policies don’t have to start straight away. If you’ve arranged for it to start, say, a month in the future, your cooling-off period won’t start for a month.

And if you cancel your policy before it actually starts, you usually won’t have to pay any fees at all.

You start a new cooling-off period when you renew

Most car insurance policies renew automatically. If you decide to stick with your insurance company when it’s time to renew, you’ll start a new cooling-off period.

During this new cooling-off period, the same rules around cancellation fees apply.

Cooling-off periods are the same when you pay monthly

Even if you pay monthly for your insurance, you’ll still get a cooling-off period.

That’s because, if you pay monthly for car insurance, you’re still getting a full year of insurance. You’re just paying it off in instalments. Like a loan.

There are a few exceptions to this. Our monthly subscription car insurance doesn’t come with a cooling-off period, but that’s because it’s not a full policy paid in monthly instalments. You’re only committing to a month at a time, and you can cancel at any time without any fees.

Optional extras can come with cooling-off periods, too

If you have any optional extras with your car insurance - like breakdown cover - these sometimes come with their own cooling-off period.

To double-check, have a look at the policy documents for the optional extra. (it’s usually separate to your main car insurance policy documents).

Like your car insurance policy, breakdown cover - and most other optional extras - usually renew automatically. So if you do let it renew after a year, you’ll start another cooling-off period.

You don’t get a cooling-off period with temporary car insurance

Things are a little different with temporary car insurance. If you want to cancel, you won’t normally get a refund.

Updated on 20th July 2020

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