Can my insurer terminate my policy?

The short answer

An insurer can terminate you when you do not comply with the policy agreement. This can happen in case of fraud, non-payment of premiums, withholding of important information, or repeated violations of the policy terms. Termination is a last resort that insurers use to end the collaboration. It has major consequences because your name will be put on a blacklist. Other insurers may then refuse to insure you or charge much higher premiums.

What does the law say?

The right to terminate is regulated in the Financial Supervision Act and in the policy terms. Insurers must comply with strict rules and can only terminate in case of serious breaches of the contract. They must first warn you and give you a chance to resolve the problem. The termination must be done in writing with a clear explanation.

What should you watch out for?

Pay close attention to the policy terms which state when your insurer can terminate. Always pay your premiums on time and immediately report any important changes to your insurer. In case of a claim, you must be honest and complete in your reporting. Keep all correspondence with your insurer in case a discussion arises later.

Example from practice

Jan has a car insurance and reports damage after a collision. He claims the other driver ran a red light, but camera footage shows that Jan himself ran a red light and deliberately withheld this. The insurer discovers this lie during the investigation and first sends Jan a warning letter. When Jan persists in his false statement, the insurer decides to terminate due to fraud. Jan gets 30 days to find another insurer, but due to the termination, he has to pay much higher premiums for a new policy.

What can you do?

If you get terminated, react quickly to mitigate the damage.