Home Insurance Short-Rate Cancellation?
I had switched insurance company effectively from AXA to Intact. The last day of my previous insurance was on Feb 25. Thus my new insurance policy starts from Feb 26 at 12:01am. Before the expirary date, I emailed the previous insurance broker that I do not intend to renew the policy. The broker then ask me to have the new broker write a letter to him for the cancellation. Because the new broker was out of town during the said period, I told the old broker that they will get the letter on Mar 1 or 2. The new broker sent the old broker the notice on Mar 2. Now, The old broker want to charge me something called ” Short-Rate Cancellation” which is 9% of the total premium for the whole year. Is this Normal?
Thank you guys for the detailed explanation and comments.
The concern I have is that if I don’t pay up, would it be possible for them to damage my credit or my ability to obtain cheaper insurance in the future (due to record they put in file)?
Actually, the policy ends at the end of Feb 25.