Guide to Getting Car Insurance After Cancellation
We’ve written about the intricacies of automotive insurance in Ontario before. We know that the complex nature of the auto insurance world means that it’s not always easy to navigate. Today, we aim to educate you on the topic of getting car insurance after a cancellation.
To help you understand auto insurance cancellation a little bit better, we’re going to walk you through the process of cancellation, including why your insurance might be cancelled. After that, we’re going to walk you through some of the next steps, and how to make sure you’re insured in the long term.
Reasons for Auto Insurance Cancellation
If you’re trying to understand the insurance cancellation you’re currently experiencing, the first step is to determine why your insurance has been cancelled, to begin with. Firstly, if you’ve cancelled your insurance for any reason, most of this article won’t apply to you. Whether you’re looking for a better rate, or you’re not driving the insured vehicle anymore, we’re going to assume that you cancelled your insurance for a good reason and you’re capable of seeking a new insurance policy after cancellation.
We will mostly be discussing what happens when your insurer cancels your policy. Some of the common reasons your insurance company will cancel your policy are:
- You violated your policy
- Your driving record is no longer consistent with their risk policy
- You haven’t been paying your insurance premiums
Policy Violations
Automotive insurance policy violations are the types of things that most drivers want to avoid. The common examples of policy violations are things like at-fault accidents, tickets, DUIs, or other violations. Your insurance can also be cancelled if you’ve given false information about yourself or your vehicle when applying for an insurance policy. This also applies to hiding accidents.
A good sort of general advice is to always drive safely and within all legal limits. If a situation occurs where you’re given a ticket or other legal repercussions, make sure not to try and hide the information from your insurer, as this could lead to further headaches. To ignore this advice is to invite cancellation from your insurer.
Risk Policy
In simple terms, an insurance company’s risk policy outlines how much risk they’re willing to take on insuring drivers. Since the insurance company doesn’t want to lose money by insuring dangerous or reckless drivers, they may cancel your policy if they feel you’re too risky for them to continue insuring.
If you’ve been dropped by your insurance company because you’re a ‘high-risk’ driver, then you may have to seek insurance from an insurance company that focuses on offering insurance policies to other high-risk drivers like yourself.
Because insurance companies like this have some of the riskiest investments in the form of potentially dangerous drivers, you can expect their rates to be higher than other insurers.
Non-Payment of Insurance Premiums
This is probably the most straightforward reason for your insurance being cancelled. You can assume that if you miss payments, you’re going to be dropped from your insurance. What you might not know is that this could also mean you become classified as a high-risk driver. After all, if you’re missing your payments, you might be willing to undertake risk in other aspects of your life, including driving.
Whether that logic is sound or not is beside the point. Not paying your insurance premium will mean you’re eventually dropped and then potentially classified as a high-risk driver. Also to be considered is the fact that even if you can find an insurer to carry your policy, you might have special restrictions placed on your payment methods or schedule.
Being cancelled for non-payment will go on your driving record, which will roll over in 3 years, in almost all cases. Missing one payment is bad enough, but if you’re missing more than one, you will almost certainly be classified as high-risk and will have to undergo the steps we’ve outlined above.
Getting Car Insurance After Cancellation
Whatever the reason for your cancellation, you need to now understand the process of getting new/different coverage.
The first thing you’ll want to be on the lookout for is your letter of cancellation. You will almost always receive a paper notification from your insurance company informing you that your insurance policy is being cancelled. The first step to understanding this document is making sure you understand what it represents. If it’s a simple cancellation, you can expect your coverage to cease based on the date outlined in the notice. If it’s a notice of non-renewal, you can rest assured that your policy is likely in effect until your annual renewal period.
To make sure you’re not driving without insurance and to give yourself enough time to seek new coverage, you should understand the timeline of your cancellation.
Once you understand the difference between those two pieces of information, it’s time to start looking for a new policy. Getting insurance after cancellation in Ontario can be challenging, but it is possible now that you’re equipped with the information you need to understand the system.
You should immediately consider contacting one of our insurance advisors so they can help you find the coverage you need at a price that makes sense.
Frequently Asked Questions
Can an insurance company cancel your policy in Canada?
Yes. The main reasons they would do so include non-payment, policy violations, and becoming too risky for their risk policy.
What happens if I miss a car insurance payment?
Each insurer is different and handles missed payments in a different way. But this is a very serious situation and should be rectified as quickly as possible.
Can my insurance company cancel my policy if I make too many claims?
Yes. Though normally you’re more likely to be facing a non-renewal than a cancellation.
Can my insurance policy be cancelled without notice?
No. Your insurance company is obliged to give you notice. They will do so in order to be consistent with the regulations surrounding automobile insurance in Ontario.
