Being a smart insurance consumer is a great way to improve your bottom line.  You can save a great deal of money by shopping for the most competitive rates for coverage that meets your needs.

When you find a new carrier who offers a better deal than your existing insurance provider, you’ll need to cancel your existing policy.  The cancellation procedure and requirements may vary based upon where you are and with whom you’re doing business, but in many cases you’ll need to send a letter expressing your desire to cancel.

While that task might be easy for some folks, others could really use an insurance sample cancellation letter template to help guide their efforts.  The simple model letter in this post covers all of critical insurance cancellation bases:

It provides the company with accurate contact information. That’s important because some situations may call for additional follow-up to effectuate the cancellation.  Additionally, you’ll want to recover any portion of your already-paid premiums due to you, so it pays to make sure the insurance company knows exactly where to send the check!

It clearly expresses your desire to cancel. You want to lay it out in black and white.  This insurance sample cancellation letter is unambiguous and straightforward.

It demands confirmation. You can’t fire off a letter and then simply assume that the insurance company will do the right thing.  Mistakes happen, papers do get lost, etc.  This model insists that the insurer verifies policy cancellation.

It contains necessary information. The model letter identifies the policy and your policy number.  Again, you want to be certain that you’ve provided all necessary information to guarantee a timely cancellation of an unnecessary policy.

Here’s the model cancellation letter:

DATE

Cancellation Department

Name of Insurance Company

Mailing Address for Insurance Company

Re: POLICY CANCELLATION

Your Name

Your Policy Number

Please cancel the above-referenced insurance policy effective immediately.  I do not want to maintain this policy.  You are no longer authorized to bill me or to access my bank accounts for payments associated with this policy.

Send written confirmation of the cancellation to the address below as soon as possible.  Please use that address to send a refund of the unused portion of my already-paid premium, as well.

Thank you for resolving this matter quickly.

Sincerely,

Your Name

//Your Signature//

Your Mailing Address

Your Phone Number

Please consider the following when writing a letter requesting policy cancellation:

• Sign it and use ink. Add your handwritten signature to the letter and do it ink.  Better safe than sorry.

• Keep a copy. Make a photocopy for your own records, just in case things get confused.

• Don’t neglect the date. The date is important.  Don’t leave it out.

• Reasons for cancelling? You’re generally under no obligation to explain why you want to kill the policy.  However, you may want to explain your rationale briefly if (a) you feel a need to explain why you’re taking your business elsewhere or (b) you want to open the door for the company to pitch you on some alternative policy or to offer you a lower rate after the cancellation.

• Make sure you want to cancel. Getting out of a bad policy or shifting to a new carrier with better coverage and/or lower rates can be a smart move.  Getting out of a policy you really do need in order to free up a little extra cash, on the other hand, isn’t.  If you’re cancel a policy, do so for the right reasons.

• Don’t just stop paying. It’s true that the insurance company will cancel a policy if you don’t pay the premiums.  However, this may result in unwanted bills and/or negative information on your credit report.  Additionally, ceasing payments won’t give you a chance to recover money that might be due back to you.

• Know the requirements. Different policies, jurisdictions, and other factors may create additional cancellation requirements.  Be certain you know what you need to do to get out of your policy correctly.