How to cancel life insurance
I don't want to renew my policy, but I cannot access my insurance company. What should I do?
During the COVID-19 pandemic, you may find that you cannot contact your insurance company on the phone due to the long wait times.
If this happens, you can send an email to the insurance company, to confirm that you do not want to renew the policy. This should be sufficient to cancel the policy before the renewal date. Keep in mind that only the policyholder can cancel the insurance policies.
You can find the email address of your insurance company on their website. In your email, it helps to include:
.Your policy number and renewal date
.The holder's name, date of birth, and zip code
It may also be helpful if you add a reason for the cancellation, and remember that you were not able to communicate by phone.
Make sure you have valid insurance to cover you after the renewal date.
Reasons for cancellation
You may decide to cancel your life insurance policy because the reason for purchasing insurance has changed.
For example, you wanted the policy to protect your mortgage payments, but windfall gains like inheritance mean you can pay off your home loan early.
Or, you may have been overpaying your loan due to the extra income and lower interest rates.
In such cases, you should bear in mind that even if the original reasons for setting the policy change, life insurance still gives your family additional financial security if anything happens to you.
Most commonly, though, people may decide to cancel life insurance because they feel they can no longer afford the premiums.
Can you work without a cover?
In a difficult economic climate, families must consider their expenses and try to find out where the cuts can be made
But the fact that the family is struggling to pay for their lives could also be an indication of how important the cover actually is.
The financial impact of a parent's death in such circumstances can be devastating, making life insurance even more important.
Policies such as these can and should be seen as a necessity rather than a luxury that should be abandoned when times are tough.
Removing coverage for a temporary period, hoping to purchase a new policy at some point in the future, could be a bogus economy.
Life insurance is generally cheaper the younger you are when taking it.
So if you have a five-year policy and decide to cancel it now, your insurance premiums will likely be much higher if you decide to reinstate coverage in two years.
In addition, it could suffer health problems in the meantime, which could push the price of any future policy higher.
Other options
If you can't afford your premiums as they are, talk to your insurance company to see if you can agree to a temporary cut in your monthly payments for a smaller amount of coverage.
This means you'll still be protected to some degree, and when you have enough money to return to the higher level of coverage, your premiums will not be more expensive than before.
Remember that if you smoke or are found to have taken medications for which your life insurance company has not been notified, this may invalidate your policy.
How to cancel
If you've just taken out a life insurance policy and want to cancel it for any reason, you generally have 30 days to do it for free - check the terms and conditions on your deal.
Outside of this initial period, you should simply write to your service provider informing them of your desire to cancel.
You should be allowed to do this for free: you will stop paying your monthly installments, and the coverage will not apply.
In general, you will not be entitled to a refund of any installments you have already paid. If you paid your installments via direct debit, you must also contact your bank to cancel the direct debit.
Be sure to check out our other guides for answers on topics such as "Does a serious illness affect your life insurance".
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