Cancelling Insurance

[reiRei]

I'm moving to BC in about a month, and just got off the phone with my insurance company here, they told me that I would incur a penalty for canceling my insurance, and I was wondering how much the penalty usually is, or does it vary by how long into the term I am... or if anyone has any experience on how I can cancel without incurring a massive penalty.

Thanks guys

[tom_9109]

Ask your broker.

[morpheus256]

Originally posted by tom_9109
Ask your broker.

Fiancee posted as me.....

Try again :D

[reiRei]

Originally posted by tom_9109
Ask your broker.

I did, he wouldn't give me a figure until I moved.

[bighead2267]

the shorter time you use, the penalty will be more. contact your broker should at least able to give you a ball park(may not be the exact configuration).

[bighead2267]

when is your policy expired? if your policy will be expire in couple mths, may be you should consider cancel on renew and set up ICBC when it come up on renew. most of the company will give you sometimes to keep AB insurance(like 2-3 mths time?)

[Masked Bandit]

It's done as a percentage of your policy value. The closer to the start of the term, the worse it is. If your policy hits renewal in the next couple of months, it will be virtually nothing.

[signature7]

I remember the broker wouldn't tell me the penalty amount until it was processed.. I remember making a thread about a similar situation however when I got the mail from my old insurance company, I got a cheque reimbursing me money.


edit: here's the thread, may or may not help.

http://forums.beyond.ca/st/229658/canceling-insurance-policy-/

[reiRei]

Originally posted by bighead2267
when is your policy expired? if your policy will be expire in couple mths, may be you should consider cancel on renew and set up ICBC when it come up on renew. most of the company will give you sometimes to keep AB insurance(like 2-3 mths time?)

My policy expires in May next year. So it just renewed a few months ago.


Originally posted by Masked Bandit
It's done as a percentage of your policy value. The closer to the start of the term, the worse it is. If your policy hits renewal in the next couple of months, it will be virtually nothing.

it would be about half way through the term...

so, the penalty would be a pro-rated amount... if you guys don't mind me asking, what is a pro-rate?

[Masked Bandit]

Originally posted by signature7
I remember the broker wouldn't tell me the penalty amount until it was processed.. I remember making a thread about a similar situation however when I got the mail from my old insurance company, I got a cheque reimbursing me money.


edit: here's the thread, may or may not help.

http://forums.beyond.ca/st/229658/canceling-insurance-policy-/

The "penalty" is just deducted from your refund. If your penalty is going to be $50 but they owe you $125, then $75 is coming your way. This is part of the reason you usually have to drop a two-month down payment to get started, so the insurance company isn't left chasing you for money if you cancel early.


Jesus, these guys have most of the angles covered eh? Bunch of crooks!

[cocoabrova]

Originally posted by reiRei
I'm moving to BC in about a month, and just got off the phone with my insurance company here, they told me that I would incur a penalty for canceling my insurance, and I was wondering how much the penalty usually is, or does it vary by how long into the term I am... or if anyone has any experience on how I can cancel without incurring a massive penalty.

Thanks guys

Why don't you just drive over in BC with your AB insurance til it expires? Just tell your AB insurance company (and ICBC or the police over there if they ask if yo get a ticket or something) that you're working there on/off for a year, and will be coming back to Cowtown on a regular basis. I did this while living in VanCity way back when for a year with no probs, plus ppl all over do it on a regular basis just to save $$ on ICBC insurance....

[reiRei]

Originally posted by cocoabrova


Why don't you just drive over in BC with your AB insurance til it expires? Just tell your AB insurance company (and ICBC or the police over there if they ask if yo get a ticket or something) that you're working there on/off for a year, and will be coming back to Cowtown on a regular basis. I did this while living in VanCity way back when for a year with no probs, plus ppl all over do it on a regular basis just to save $$ on ICBC insurance....

Yeah, I was hoping to be able to drive around for 3 months without changing over my insurance and doing the OOP, but the grace period is only 4 weeks there as opposed to 3 months here.. booo

[Masked Bandit]

Originally posted by reiRei


Yeah, I was hoping to be able to drive around for 3 months without changing over my insurance and doing the OOP, but the grace period is only 4 weeks there as opposed to 3 months here.. booo

Says who? The rules are set by your HOME province, not where you are moving to. AB rules apply, you have three months.

Think about it, AB Insurance are the ones who would be paying the bill if there were an accident, wouldn't they get to decide how long you are covered for?

[5000Audi]

i lived in BC for 7 months and kept my AB insurance the whole time.. got into a car accident while i was out there... in the 4th month and isurance stil covered it.. i never had a problem with it.. as long as you dont let your insurance company know haha.. if you get a ticket out there.. make sure to pay it in alberta

[03ozwhip]

i dont understand....why do you get a penalty for cancelling, when there is no possible way for you to keep them in the first place if youre moving to a different province?? i dont think thats fair at all. its like thyre telling you that you cant move or else you get penalized....wtf is that?? i guess its the rules, but cant this one be bent?....masked bandit, this is to you...

[Masked Bandit]

Originally posted by 03ozwhip
i dont understand....why do you get a penalty for cancelling, when there is no possible way for you to keep them in the first place if youre moving to a different province?? i dont think thats fair at all. its like thyre telling you that you cant move or else you get penalized....wtf is that?? i guess its the rules, but cant this one be bent?....masked bandit, this is to you...

Your insurance policy is a one year contract, and like any other contract, if you want out early it's going to cost you. Now, with that said in this situation where the OP is moving out of province, it's the insurance company that isn't keen on keeping the policy in force until renewal. They would rather see him flip to ICBC so a decent broker should be able to get a "pro-rata" (no penalty) cancellation. This is just another situation where a broker will out perform a direct writer.

And yes, that was a shameless plug for brokers vs. direct writers!

:D

[syrous]

i didnt know that there a cancellation penalty here in calgary... when i canceled my insurance in torono i didnt pay anything...


what about just transfer ur insurance there.. im pretty sure they have a branch there....


"Yeah, I was hoping to be able to drive around for 3 months without changing over my insurance and doing the OOP, but the grace period is only 4 weeks there as opposed to 3 months here.. booo"

how would they know u been there for more than 4weeks? i dont think they'll watch u 24/7.... lol.....

[kaput]

.

[reiRei]

I will likely try to drive around for a few months, and play "silly girl, I forgot the change it over... I didn't know"

Another question I do have, is how they determine a pro-rate, is it just the minimum percentage per month I would have to pay?

[Masked Bandit]

Originally posted by reiRei
I will likely try to drive around for a few months, and play "silly girl, I forgot the change it over... I didn't know"

Another question I do have, is how they determine a pro-rate, is it just the minimum percentage per month I would have to pay?

When you say "pro-rate" I'm assuming you are referring to my use of the term "pro-rata"? If that is the case, they calculate the exact number of DAYS of insurance you have used, figure out your insurance cost per day (annual premium divided by 365 plus the interest fee for monthly payments, usually 3%) and see if you are ahead or behind. 999 times out of 1000 you'll be ahead because of the two month down payment paid when you first started on monthly.

Or did I totally miss the point?

[Mar]

1. You shouldn't have to change your insurance at all if you're still living in Canada. The province you live in is irrelevant.
2. The period for out of country moves is 3 months. I moved to New York last year and moved back the day before my 3 months was up.
3. Renewing your insurance with a gap in your insurance duration will cause you to be put in a different bracket of risk. Right now I'm in the cheapest bracket but if I had canceled while in the USA and renewed when I came back, I'd have to start at the bottom again like a new driver with higher rates.

[freshprince1]

Originally posted by reiRei
if you guys don't mind me asking, what is a pro-rate?

Not at all. A "pro-rated" can go several ways, usually its just a proportional value of your contract over how many months you are locked in for. Sometimes, you'll pay double the first month, then get a reimbursement after you cancel, all based on the pro-rated amount.

I don't have a dictionary definition, but this has been my experience.

[Masked Bandit]

Originally posted by Mar
1. You shouldn't have to change your insurance at all if you're still living in Canada. The province you live in is irrelevant.
2. The period for out of country moves is 3 months. I moved to New York last year and moved back the day before my 3 months was up.
3. Renewing your insurance with a gap in your insurance duration will cause you to be put in a different bracket of risk. Right now I'm in the cheapest bracket but if I had canceled while in the USA and renewed when I came back, I'd have to start at the bottom again like a new driver with higher rates.


I'm not picking on you here buddy but all three of your points are wrong and 2 & 3 are just out of date.

1. Since insurance is legislated PROVINCIALLY, your province of residence has everything to do with where you get your coverage. Why do you think ICBC doesn't sell insurance in Alberta?

2. Being in the Excited States used to be a problem if you were down there for more than three months at a stretch but it no longer can be held against you. As long as you are still a permanent, legal resident of Alberta there is nothing the insurance companies can do about it. The most common example of this are people that go down for school. You can now keep your Alberta insurance.

3. Once upon a time a gap in coverage would in fact phuck your rates over big time however the new rules state that a gap in coverage of less than two years can not be held against you.

I hope that clears things up.

[pinoyboy88]

Wow this thread has been really informative. Was going to cancel my policy but didn't know what would happen if I did, but now I know.

[Mar]

Originally posted by Masked Bandit



I'm not picking on you here buddy but all three of your points are wrong and 2 & 3 are just out of date.

1. Since insurance is legislated PROVINCIALLY, your province of residence has everything to do with where you get your coverage. Why do you think ICBC doesn't sell insurance in Alberta?

2. Being in the Excited States used to be a problem if you were down there for more than three months at a stretch but it no longer can be held against you. As long as you are still a permanent, legal resident of Alberta there is nothing the insurance companies can do about it. The most common example of this are people that go down for school. You can now keep your Alberta insurance.

3. Once upon a time a gap in coverage would in fact phuck your rates over big time however the new rules state that a gap in coverage of less than two years can not be held against you.

I hope that clears things up.
Wow. I assume this has changed within the last year because I only got back to Canada last July and this is what I was told in a lengthy conversation with my insurance company.

And they also would have let me keep my same insurance after I moved between provinces. I talked to them and had to renew by my registration and previous insurance were in Alberta, I was living in Newfoundland and my car was in Atlanta. They said if I registered my car in Newfoundland they'd switch my insurance to the same.

[Masked Bandit]

Originally posted by Mar

Wow. I assume this has changed within the last year because I only got back to Canada last July and this is what I was told in a lengthy conversation with my insurance company.

And they also would have let me keep my same insurance after I moved between provinces. I talked to them and had to renew by my registration and previous insurance were in Alberta, I was living in Newfoundland and my car was in Atlanta. They said if I registered my car in Newfoundland they'd switch my insurance to the same.

The rules have been this way for at least the past decade (the length of time I've been doing this).

[reiRei]

Originally posted by freshprince1


Not at all. A "pro-rated" can go several ways, usually its just a proportional value of your contract over how many months you are locked in for. Sometimes, you'll pay double the first month, then get a reimbursement after you cancel, all based on the pro-rated amount.

I don't have a dictionary definition, but this has been my experience.


Originally posted by Masked Bandit


When you say "pro-rate" I'm assuming you are referring to my use of the term "pro-rata"? If that is the case, they calculate the exact number of DAYS of insurance you have used, figure out your insurance cost per day (annual premium divided by 365 plus the interest fee for monthly payments, usually 3%) and see if you are ahead or behind. 999 times out of 1000 you'll be ahead because of the two month down payment paid when you first started on monthly.

Or did I totally miss the point?

Thanks so much for the advice guys, really helps with the stress of moving, one less thing on my plate :)

2 weeks left til the big move

[Mar]

Originally posted by Masked Bandit


The rules have been this way for at least the past decade (the length of time I've been doing this).

It's different per insurer then, I moved around a lot last year and would just call my insurance company each time:
me - Hi, I wanted to let you know I'm now living in [C] province.
them - Okay
me - thanks
them - bye

They would just switch it over. And when I told them I had moved to the USA in August of 2007, they told me I had 3 months before I had to move back to Canada or find a company down there. They would not continue my policy.

[w_man]

Originally posted by Masked Bandit


Your insurance policy is a one year contract, and like any other contract, if you want out early it's going to cost you. Now, with that said in this situation where the OP is moving out of province, it's the insurance company that isn't keen on keeping the policy in force until renewal. They would rather see him flip to ICBC so a decent broker should be able to get a "pro-rata" (no penalty) cancellation. This is just another situation where a broker will out perform a direct writer.

And yes, that was a shameless plug for brokers vs. direct writers!

:D

So I guess this is my beef ... why does it have to be a contract? I mean why can't it be a month to month instead of a contract. I understand how this is a marketing tool used by many businesses like gyms, cell phone service providers etc but when insurance is mandatory and the government does have a roll in the industry, why is this rule still in tact?

You pay your insurance and if you need to cancel, you have to give a 30 day notice so that your name came be taken out of the system properly blah blah ... just like when you are on a month to month. Sounds a hell of a lot like a cash grab to me ... I wouldn't have a problem if this wasn't a heavily regulated industry ... very similar to the airlines and cell phone providers ...

/rant

[em2ab]

Originally posted by w_man


So I guess this is my beef ... why does it have to be a contract? I mean why can't it be a month to month instead of a contract. I understand how this is a marketing tool used by many businesses like gyms, cell phone service providers etc but when insurance is mandatory and the government does have a roll in the industry, why is this rule still in tact?

You pay your insurance and if you need to cancel, you have to give a 30 day notice so that your name came be taken out of the system properly blah blah ... just like when you are on a month to month. Sounds a hell of a lot like a cash grab to me ... I wouldn't have a problem if this wasn't a heavily regulated industry ... very similar to the airlines and cell phone providers ...

/rant
Go with another company. Mine is month to month.

[Masked Bandit]

Originally posted by w_man


So I guess this is my beef ... why does it have to be a contract? I mean why can't it be a month to month instead of a contract. I understand how this is a marketing tool used by many businesses like gyms, cell phone service providers etc but when insurance is mandatory and the government does have a roll in the industry, why is this rule still in tact?

You pay your insurance and if you need to cancel, you have to give a 30 day notice so that your name came be taken out of the system properly blah blah ... just like when you are on a month to month. Sounds a hell of a lot like a cash grab to me ... I wouldn't have a problem if this wasn't a heavily regulated industry ... very similar to the airlines and cell phone providers ...

/rant

As for the one year thing, who knows. It's just the way it is. And you don't have to give 30 days notice to cancel. You can do it effective immediately. If your policy is on monthly payments it may take a couple of weeks to process the cancellation and stop all automatic payments but the effective date of cancellation is still the day you specifiy.

[Masked Bandit]

Originally posted by em2ab

Go with another company. Mine is month to month.

You PAY monthly but if you check your pink card / policy documents you'll see that it's a one year term.


FWIW, there are six month policies but usually you can't do monthly payments, only full pay.

[Masked Bandit]

Originally posted by Mar


It's different per insurer then, I moved around a lot last year and would just call my insurance company each time:
me - Hi, I wanted to let you know I'm now living in [C] province.
them - Okay
me - thanks
them - bye

They would just switch it over. And when I told them I had moved to the USA in August of 2007, they told me I had 3 months before I had to move back to Canada or find a company down there. They would not continue my policy.


Your company (whomever they are, I'm guessing a direct writer) obviously operate in all the non-government insurance provinces. When you move from let's say AB to ON, behind the scenes they would have cancelled the AB policy and rewritten a new ON policy. The reason for this is that like I mentioned before insurance is legislated provincially, not federally, so the underlying legal details will still vary somewhat from province to province. If you were to move to one of the government provinces (BC, SK, MB) this would not work because you MUST buy your basic insurance from the government.

Of course all of this is assuming you have a regular, personally insured vehicle. If we're talking about a large commercial account then that is a whole different kettle of fish.