Losing Your Insurance
Terminated Insurance Coverage
Insurance companies have the right to terminate your coverage; however, they must follow the guidelines listed in your policy to do so.
Three Ways Your Policy Can Be Terminated
Cancellation is when your policy is terminated during the policy period. You may cancel your policy by returning the policy to the company or agent or giving the company advance written notice of the date you wish to cancel the policy. If you cancel your auto policy prior to its expiration date, understand the insurance company may assess a short rate cancellation. The company will calculate how many days the policy was in force and using percentages in the personal auto manual, calculation will be done to determine how much is owed or if a refund is due. Short rate cancellation is not a NC law, but it is apart of the policy contract.
Your company may cancel your Liability, Medical Payments and Uninsured Motorists or Combined Uninsured/Underinsured Motorists coverages by mailing to your last known address:
- Notification at least 15 days in advance, if cancellation is for non-payment of premium; or
- Notification at least 60 days in advance, for all other cases.
Your insurance company may cancel any coverage other than your Liability, Medical Payments and Uninsured Motorists or Combined Uninsured/Underinsured Motorists by mailing to your last known address:
- Notification at least 10 days in advance.
The reasons for cancellation, of different types of coverages, will vary. Contact your agent if you have questions about why your policy canceled.
Nonrenewal denotes your company’s refusal to renew your policy. An insurance company can nonrenew your Liability, Medical Payments and Uninsured Motorist or Combined Uninsured/Underinsured Motorist coverages by mailing notification to your last known address at least 60 days before the end of the policy period. Any other coverage may be nonrenewed by mailing notification to you at least 10 days before the end of the policy period.
If the insurance company offers to renew or continue your coverage and you do not accept, the policy will automatically terminate at the end of the current policy period. Failure to pay the required premium to renew or continue your policy will mean you do not accept the offer. If you purchase other insurance on your covered automobile, any similar insurance provided by the initial policy will terminate. The termination will occur on the effective date of the other insurance.