Can I Cancel My Car Insurance After An Accident in Canada?

When your car insurance company treats you poorly, you might want to change insurance companies. Unfortunately, sometimes you don’t know that you have a poor car insurance company until after an accident occurs. Fortunately, with auto insurance policies you are allowed to cancel your auto insurance at any time. However, it is important to realize that in order for you to be able to submit an auto insurance claim, you need to submit a claim to an insurance company within 24 hours after an accident occurs. It is unlikely that an insurance company is going to take you on right after you had an accident and pay for your claims. This means you’re likely going to be stuck getting your claim put through with your current auto insurance provider.

Car Insurance Cancelation Laws

laws

There are no laws regarding when you are allowed to drop your auto insurer. You are allowed to drop your insurer at any point in time. However, your insurer has rules that only let them be able to drop you under certain circumstances. These circumstances must involve you doing something inappropriate and abusing your auto insurance policy. Things like failing to pay your auto insurance, having a suspended license or no vehicle registration, giving the insurance company fraudulent information or making a fraudulent claim on your insurance are great reasons why an insurance company could drop you as a client.

Can You Cancel A Car Insurance Claim After It Has Been Filed?

Insurance companies love it when customers cancel their auto insurance claims. You are definitely allowed to cancel your auto insurance claim and your insurance company will be happy to do so. However, it is important to keep in mind that any time you file an insurance claim, the claim is going to affect your driving record. So, although you can cancel your claim after it has been filed, it is not exactly recommended. However, problems like not being able to pay your insurance deductible do occur. If that is the reason for canceling your auto insurance claim, that would be a fair reason to do so.

How Long Do I Have before I Have To Report a Car Accident?

24 hours

In Canada, you have a total of 24 hours before you have to report a car accident. You only have to report a car accident, by law, if the total damage that was done is over $2000. When an accident occurs that has over $2000 in damages you either have to report that accident to the police or a collision reporting center. If you do not report an accident when this occurs, you could be charged with leaving the scene. Depending on the circumstances, a conviction could result in a higher auto insurance premium, fines and sometimes even jail time. you are also required to report all collisions to your auto insurance company. If you fail to do this, and the other driver does, your insurance rates are likely to skyrocket.

Will Canceling My Auto Insurance Claim Cause My Insurance Rates To Go Up?

Although the claim will still show up on your insurance record, it should not have an impact on your auto insurance rates. Fortunately for you, the actual dollar amount of auto insurance claims does show up for insurance companies. Due to this reason, your future insurance companies will just see a zero dollar claim. This is good news for you as this certainly does not increase the risk for an insurance company to sell insurance to you and you should expect to be able to still pay a low rate for your insurance premium.

Can I Cancel My Car Insurance With An Open Claim?

Contrary to what you might think, you can cancel your car insurance if you have an open claim. Your claim will remain open with your previous insurance company, however. You previous insurer cannot refuse to settle the claim if your policy with them was valid at the time when you make a claim. Unfortunately for you, this also means that you’re going to have to continue to deal with your insurance company until the claim has run its course. You will have to still pay any outstanding deductibles to your old insurance company and any other expenses that come up in regards to your claim. Also, it goes without saying, you cannot submit the same claim to your new insurance company.

What Happens If My Car Insurance Was Canceled Before An Accident?

canceled

If for some odd reason your insurance company did not notify you that they were canceling your auto insurance before you got into an accident, you should be okay. However, if this is not the case you are going to be in some deep trouble. It is against the law to drive without insurance coverage anywhere in Canada. The driver of the vehicle will be able to come after you for their pain and suffering as well as for any damages you caused. On top of that financial loss, you are also going to have a tough time finding a new insurance company. You might even face large fines and jail time depending on the severity of the accident and the circumstances. A lawyer is the first person you are going to want to talk to.

To Conclude

You are allowed to cancel your auto insurance policy any time that you want. However, it may not be the best time to cancel your policy as soon as you have made a claim on your insurance. Your insurance company is not going to be to be too happy with you as they will be unable to make their money back by keeping you on as a customer. Due to this reason, you may find that you have some unnecessary troubles with your claim. You might also have a problem with finding a different insurer. Other insurers are probably not going to like the fact that you left your old insurer with an open claim. It is very important to weigh the pros and cons of switching insurance providers before you take the plunge. It isn’t always easy to go back.

Resources:

https://budgeting.thenest.com/can-cancel-insurance-open-claims-33267.html
https://www.insurancehotline.com/accidentally-speaking/