Can I Cancel My Taxi Insurance?

Yes, you should be able to cancel your taxi insurance. But depending on the policies of the taxi insurance company and how long it’s been since you bought your policy, you may or may not receive a refund.

Do keep in mind that it’s unlikely in any case that you’ll be eligible for a full refund – at minimum, an insurer will need to charge you for the time you have spent already covered by them as well as admin fees; otherwise you will have technically been driving uninsured, which is illegal in the UK.

Exactly how much you’re eligible to receive as a refund will depend entirely on the taxi company you’re insured through. Be sure to check the terms & conditions of your policy before going to cancel, as they will include both the process for initiating a cancellation and the process for deciding refunds, as well as fee and refund amounts.

Even if you’ve paid in full, you could still be eligible for a refund, so don’t feel that just because the money is already gone, you’re any less eligible to get your money back than someone paying in instalments.

If you’re still within your cooling-off period, which by law must be at least 14 days (which starts from your policy beginning or you receiving your insurance documents, whichever begins later), then you are allowed to cancel your policy for any reason. Your insurer will likely still charge you a small administration fee to cover their time and will deduct the cost of any time you spent covered by their policy from your eventual refund, but this should see you get a majority of the money you initially spent returned.

If you’re past your cooling-off period, then you’ll want to check the terms & conditions of your policy to see what you’re eligible for. Suppose you haven’t made a claim during the policy term or are almost at the end of your policy (usually the final 3 to 4 months). In that case, you should be eligible for some form of a refund, likely in the form of a % of the original premium.

Don’t be surprised if it doesn’t correlate exactly to the number of months you’re into the policy – many policies online specify that with 8-9 months remaining on your policy, you’re only eligible for a 50% refund, for example. Given the fact that you signed the contract in the first place it’s extremely unlikely you’ll be able to dispute it despite it not correlating properly.

Once your policy is cancelled, it goes without saying that you will no longer be covered for any taxi work. You’ll either need to find another policy before continuing work or stop driving altogether. The punishments for driving as a taxi driver without proper insurance can be severe, so don’t be surprised if you receive driving license points, fines and even disqualification from driving (both socially and professionally) if you drive without the correct insurance.

If you’re thinking of becoming a part-time driver or conscious of a scenario where you might need to cancel your taxi insurance, consider pay-as-you-go (PAYG)/top-up taxi insurances sit next to your social, domestic & pleasure vehicle (SD&P) insurance. You can cancel PAYG any time, and they’re usually isn’t a charge for leaving, but keep in mind some vehicle insurers don’t consider them as legal so that you might run into trouble with your SD&P vehicle insurer. Be sure to run this by your SD&P provider and get their approval.


Taxi insurance cancellation


Both you and your insurer are legally able to cancel a taxi insurance policy.

From your side, it could have been a result of a change in circumstances or a new employment opportunity taking you out of the taxi driving market. From their side, you might have had something change to make you riskier to insure (thus requiring an updated price), or you may have failed to stick to the terms & conditions of the policy, resulting in it becoming invalid.

You may be eligible for some form of a refund, but the amount of which will depend on how deep into your coverage you are and your insurer’s refund policy. This is fairly unlikely to be correlated to the exact length of time you are into your policy but will be clearly outlined in the terms & conditions, so make sure to have a read before making a cancellation request. If you’re still in your cooling-off period, you should be able to get almost all of your premium back, less an admin charge. If you’ve made a claim, you may not get any refund – which also means if you pay monthly that you may be required to continue making payments after you cancel for the rest of the policy year.

Your insurer is within their rights to invalidate your cover if they believe the circumstances that you signed up to your insurance with have changed significantly (e.g., a noticeably increased level in the risk of you having an accident) or that you’ve failed to stick to the original terms of the agreement (e.g., driving during hours you weren’t covered for). In either circumstance, your insurer can withdraw your coverage and depend on the situation, and you may not be eligible to receive a refund.


The cancellation fee for taxi insurance


Taxi insurance businesses typically charge a fee of roughly £50 to cancel and may also refund you a smaller percentage of any premium you’ve paid compared to the time you’ve had cover. The refund may be less than you’d expect if the company calculates the per-day cost of the insurance you’ve used at a rate higher than an equal pro-rata amount. This means that if you cancel after your cooling-off period, you’re unlikely to receive a refund equivalent to the amount of time left on your policy.


Will I get a refund on taxi insurance?


Taxi insurance companies will outline the conditions for refunds in their terms & conditions. When you signed up for your policy, you will have received a copy of these, so go back and check what your insurer’s policy is regarding refunds to find out what you’re eligible for.

If you’re still within your 14-day cooling-off period, you should be eligible for a nearly full refund, with deductions made for administration fees and the days you did spend covered.

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