Will I get a refund for my insurance renewal?

Question

I Switched insurance from company A to company B. Insurance A had already charged the renewal amount December 9th even though I’m not due to renew until December 22nd (since that’s when my coverage ends). I called insurance A to ask if I would get refunded the renewal amount since I requested to cancel?

They said I had to wait 10days for the policy to cancel and then they would inform me if I was entitled to a refund. They also said they have to charge 10% of the insurance premium as a cancellation fee (I’m in Florida). I asked what premium they would charge the 10% on, the current premium or the one that would be effective once renewed on December 22nd? They said they were not sure and I had to call back after the policy is officially canceled (10 days) to ask about the 10% fee and the renewal refund, if any. And that the 10% would most likely be charged from the new premium (which is about 800$ more than the current premium I’m trying to cancel). How does this make sense??

I asked to speak to someone who could answer my refund questions but they kept telling me the same thing, I have to wait for the policy to cancel so that the finance/accounting department decided on the refund amount & 10% fee.

Is the normal? Should I seek legal advice? Or can I process a chargeback through my credit card company if they don’t refund me the renewal amount?

Answer 1

It sounds like the agent you spoke to may have been confused about your "cancellation" request. Partial refunds apply when you are cancelling mid-term, and might incur a fee as mentioned. It sounds like the agent thought you wanted an immediate cancellation with 10-12 days still remaining on your current policy. The pro-rated value of those few days wouldn't be very much, but it's not nothing.

Instead, what it sounds like you need is to simply not renew with company A. In this case your current policy would remain in effect until 22-Dec, no refund would be needed as you would need the policy to remain active all the way up until your next policy with company B takes effect. The premium that company A already charged would be fully refundable with no fee, as you haven't received anything (yet) for what was paid.