When you decide to cancel any type of insurance, a written cancellation request documents your intention. Although some companies accept only written cancellation requests, a follow-up letter is a good idea even if the company accepts telephone or online cancellation requests. The letter doesn't need to be complicated, but it does need to be specific and should include a request for a refund of unused premiums.
Review cancellation rules in your policy, as in most cases only the policyholder, or the primary policyholder if the policy includes more than one person, can submit a cancellation request. Look for the policy number and the policy period on the summary or declarations page and record this information. Also, look for the name of a contact person. If you don't see one, contact the customer service department and get a name to avoid having to include a generic salutation.
Format and Opening Information
Review instructions for writing a business letter or download and modify a generic cancellation letter template. Free templates are available on websites such as Einsurance.com, CancellationServices.com and AmPm Insure. Regardless of the type of insurance you're cancelling, include your full legal name, a current or forwarding mailing address and telephone number in the top section of the letter. Add a reference line between the top section and salutation in which you state your intention and provide the policy number and period. For example, include a line such as "Re: Cancellation of Auto Policy #12345; January 1, 2014 to December 31, 2014."
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The Body and Closing
Keep the body of the letter short and to the point. Make your cancellation request and include the effective date in the opening paragraph. Although providing a reason is optional, if you have a specific reason for making the request, such as poor customer service or better and less expensive coverage elsewhere, include it in the opening paragraph. Ask for a refund of unused insurance premiums in the second paragraph. If you're making payments by automatic deduction, you can also state that you want these discontinued in this paragraph. In the closing, ask for written confirmation of your cancellation request within 30 days.
Send the Letter
EInsurance recommends that you send the letter by postal mail with a return receipt. This important protection not only removes any doubt as to the delivery date, but also starts the clock on the time period for receiving a confirmation letter. It is also further evidence if the insurance company fails to cancel the policy on the requested date or continues to send monthly bills.