Home insurance cancellation fee

It’s easy to get stuck in a home insurance rut. You end up renewing with the same provider because you’ve either left it too late to go somewhere else or you just can’t be bothered to shop around. But every now and again in those little moments of madness when you blitz the household admin you might realise a better deal can be had elsewhere. And if that’s the case – what are the facts on cancellation fees?

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Cancelling home insurance

There’ll be lots of reasons why you might want to cancel your home insurance. Maybe you’ve found a better deal elsewhere and want to switch, or you may have simply changed your mind; perhaps you’re in the process of moving away – or even better – moving abroad.

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Can I cancel my home insurance?

In short, yes – you can. If you’ve taken out a home insurance policy, then by law, you have a 14 day ‘cooling off period’ during which you can change your mind. The cooling off period begins from the date your policy starts or when you receive your policy documents – whichever is later.

Any premiums you’ve paid should be refunded to you – but minus a small amount to cover the days that the policy was active for. You may also be charged an admin fee – check your policy terms and conditions for the amount.

But even once your cooling off period ends, you can still cancel your home insurance but any refund will be calculated pro rata (in other words, you’ll only get back a proportion of your premiums based on the length of time the policy ran for). You may also be charged a cancellation fee and further admin fee. Tot up the cost of any cancellation fees because if you’re switching for a better deal the savings you make from switching might be swallowed up by fees and charges.

Be cautious, because after your cooling off period, any refund or extra fees are at the discretion of your provider – always make sure you check your T&Cs before cancelling. And remember that it doesn’t cost anything to change your policy at renewal. If you feel the charges are unreasonable, you can of course contact your insurance provider’s customer service department but you’ll need to provide an explanation of why you think the charges are too high.

Home insurance cancellation – need to knows

When you cancel your home insurance, always ensure you actually tell your insurance provider –It’s usually worth speaking to them over the phone in the first instance, and they will let you know if you need to notify them in writing. When you speak to your provider you can find out what cancellation fees may apply.

If you have a direct debit, simply cancelling it doesn’t mean that you’ve cancelled your home insurance – unless you and your provider have mutually agreed to cancel your policy, your contract with them will technically still be binding. All it means is that you’ve stopped paying the premiums – which in turn, means you’ll end up with an angry insurance provider on your case who is likely to chase you for the money you owe.

You’ll also need to make sure that if you cancel one policy, you have another already in place. Leaving your home uninsured for any length of time is just too risky to do – the golden rule of home ownership – ensure you’re insured.

Renewals

If you want the best home insurance deal, try not to fall into the auto-renewal trap. Set yourself a reminder a month before your insurance is due to end and use that time to comparethemarket.45% of customers achieved an average saving of 39%* – why not see if you can join them and start a new quote today?

*This average saving is achieved by 45.08% of consumers with comparethemarket.com Buildings and Contents Insurance, according to independent research carried out by Consumer Intelligence during May 2016.

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