Canceling Insurance Policies
Canceling Insurance Policies
When someone dies, their personal insurance policies do not cancel themselves. Health, auto, home, renters, and liability policies may remain active and continue to be billed to the estate unless someone takes formal steps to terminate them. Ignoring these policies can result in unwanted charges, legal liabilities, or even the misuse of coverage.
This is a task that often gets overlooked, but taking care of it early can protect the estate and avoid problems down the line.
Insurance companies typically continue policies by default unless they are notified otherwise. Premiums may continue to be auto-drafted from a bank account or credit card, draining funds that could be used for estate costs or funeral expenses. In some cases, unused policies may even be eligible for partial refunds if canceled promptly.
There is also a risk in leaving coverage open. If someone uses a car or property insured under the deceased person’s name and an accident occurs, the insurer may deny the claim. Canceling or updating the policies prevents these types of issues.
How to approach this:
Locate Active Policies
Common policies that should be reviewed and possibly canceled include:
- Private health insurance not tied to an employer
- Auto insurance
- Homeowners or renters insurance
- Personal liability or umbrella policies
- Supplemental or specialty insurance
Check mail, emails, online accounts, or recent bank statements to locate active policies. If the deceased had an insurance agent, they can also help identify what policies exist.
Cancel or Transfer Policies
Once you locate a policy, contact the insurance company directly. Most will ask for:
- A certified copy of the death certificate
- The policy number or other account information
- Proof that you are the legal representative of the estate, such as Letters Testamentary or Letters of Administration
Be sure to ask for written confirmation of the cancellation. You should also ask if any refunds are due for unused portions of the policy.
If the policy covers property that is still in use, such as a house or vehicle, do not cancel it immediately. Instead, speak with the insurer about transferring the policy or keeping basic coverage in place until the estate is settled.
Special Note on Health Insurance
If the deceased had a private health insurance plan that was not provided through an employer or Medicare, you will need to contact the insurance company directly to cancel it. Make sure to stop any automatic bank payments or drafts as soon as possible.
Need Help?
If you are unsure where to begin, a licensed insurance agent or an estate attorney can help you gather the necessary documents and notify the relevant companies. You can also contact the Louisiana Department of Insurance at 1-800-259-5300 for assistance with questions about policies issued in the state.
Canceling unneeded policies is not just a matter of housekeeping. It protects the estate and prevents costly errors.
