Car Insurance Will canceling car insurance affect my credit score? Canceling your car insurance is not likely to have a direct impact on your credit score. By Insure.com's Editor | Updated on August 9, 2023 The page is part of the topic how to cancel car insurance Why you should trust Insure.com Quality Verified At Insure.com, we are committed to providing honest and reliable information so that you can make the best financial decisions for you and your family. All of our content is written and reviewed by industry professionals and insurance experts. We maintain strict editorial independence from insurance companies to maintain editorial integrity, so our recommendations are unbiased and are based on a comprehensive list of criteria. Canceling your car insurance is unlikely to directly affect your credit score. Insurance companies do not report policy cancellations to credit bureaus. However, there are some indirect ways in which it could impact your credit score. Potential indirect effects of canceling car insurance on your credit score Unpaid premiums – If you have any outstanding premiums when you cancel your policy, your insurer might send the unpaid amount to collections, and that could negatively impact your credit score. Coverage gaps – Cancelling without having a new policy in place could lead to a gap in coverage. If you get into an accident during this period, it might result in financial difficulties that indirectly affect your credit score. Credit-based insurance scores – In some states or regions, insurers use credit-based insurance scores to determine premiums. If you cancel multiple policies or frequently change insurers, it might be perceived as instability, potentially affecting future insurance rates. Best practices to cancel car insurance Follow these best practices to avoid affecting your credit score Pay premiums on time – Ensure you pay your insurance premiums on time to avoid any issues with collections and credit score impact. Plan ahead – If you’re considering canceling, have a new policy in place to avoid coverage gaps and financial risks. Shop wisely – When looking for new insurance, obtain quotes without affecting your credit score using soft inquiries. Conclusion While canceling car insurance directly does not impact your credit score, it’s essential to be mindful of potential indirect effects like unpaid premiums and coverage gaps. Pay your premiums on time, plan ahead, and choose insurance options wisely to maintain a healthy financial standing. In case you missed it Best Car Insurance Companies of 2023 Car insurance rates by state: The most expensive and cheapest states for car ins... What is Full Coverage Car Insurance? A complete guide to car insurance costs for seniors A complete guide to adding a teenager to your car insurance policy What to do after a car accident that’s not your fault Total warfare: What to do when your auto insurer totals your car Car insurance claims: Who gets the claims check? Buying and insuring a used car: Most and least expensive models to insure in 202... The Best Car Insurance for Bad Credit of 2021 The best car insurance companies for speeding tickets Car insurance after a DUI Guide to Car Insurance Discounts Proper insurance coverage for college-bound children How to read (and actually understand!) your auto insurance policy Car Insurance Companies New driver insurance grace period: What you need to know How much do insurance agents make Autonomous cars: 5 delightful and 5 distressing things Busted! Part 1: How insurance companies spot bogus claims Insurance options for rideshare drivers 10 things that are illegal but shouldn’t be 1/1 Get instant quotes now ! Please enter valid zip Get Quotes