If you have an accident and write off your car, do you have to continue paying your insurance for the year?

Question

My insurance company tell me that even though I don't have the car and no longer need the insurance, I still have to keep paying for the next 6 months and can't cancel it! Are they allowed to do this?

Answer 1

no i would think the settlement would include the balance on the insurance

Answer 2

yes its true (sorry)

your policy covers the events within that 12 month contract,

you could cancel the policy as they cant insure a car thats not on the road but you will still have to pay the remainder of the year, the only way you can get out of this is to buy back the claim that way officially you did not make a claim so you can cancel the policy and not have to pay the rest of the year(but you will get a canx fee)

if you have a new car ask them to do a change of vehicle so then you can use the last 6 months  of your policy on a car you have. generally you would only have to pay extra if your new car is a higher insurance rate.

Answer 3

If you entered an agreement to pay in installments, then yes, you are liable for the remainder of the payments.

The bright spark that suggests that you cancel your direct debit is setting you up to be put on a debtors list, which could make life very difficult for you in the future.  They might also take legal action to reclaim the remainder of the payments.

Answer 4

Yes. It's a cruel world.

Answer 5

Yes!

The insurance company are taking a gamble on you, based on your risk. Your yearly premium covers this risk.

It would be absurd if people were allowed to stop paying just because they've proved to be a bad risk!

Answer 6

yep

Answer 7

no i would call them up. you can transfer it ova to your new ins. i think they charge a cancellation fee but you shouldnt have to pay it for the rest of the year if you no longer have the car! y shud u pay for something u no longer have???

Answer 8

You agreed to pay X no. of £s for ins,  because you haven't paid the full amount ( because you're paying monthly) you will have to keep up payments until the amount agreed is met...

Answer 9

I'm not sure about not canceling and getting a refund, but you do have to keep paying.

When you pay in installments, all you are really doing is entering into a finance agreement, and it's this that you are still paying....

Answer 10

My bf rescently got rid of his truck and I just called up Progressive and canceled it off the policy right then and there and they gave me my new price..I can cancel any car at any time with them...never heard of paying for a car you dont have, Ins wise anyways...

Answer 11

The logic behind you continuing to pay is as follows:

a) You bought 1 year's cover but have not paid a full year's premium.

b) I assume the insurance company paid your claim in full and not just the proportion (1/2) covered by your partial payments at the time of the claim.  

This payment is the total value of the car, however there are other things covered by the policy such as personal liability etc (check your policy for full details) which you are no longer being covered for but for which the premium is paying for.  You could ask them to refund that part of the premium which may be significant,if your car was not worth a lot to start with.  You could ask them to break down the premium into its component parts.  You will need to work on their sense of fair play as I am sure the policy wording allows them to insist on the continued payment

If you are taking out another policy on a new car I am sure you could get them to make an allowance.

Answer 12

Most motor insurance premiums are charged annually rather than monthly. The insurance company may allow you to pay monthly but that does not alter the fact that you have entered into an annual contract with your insurer.

If you had paid the premium on a credit card, you would still be liable for the full amount even if the car was written off. In your case, the insurance company is lending you the money to pay the annual premium.

Answer 13

Yes!  You entered into a contract when you took out the insurance.

They are letting you pay by instalments as a privilege so you still have to pay.

Of course you could cancel the insurance but then you wouldn't get a payout on your claim.

Answer 14

stop the direct debt. easy