What happens if I change my life insurance policy midway?

Published on November 20th, 2020
  Written by 
Bill Tsouvalas
Bill Tsouvalas is the managing director and a key company spokesperson at Savvy. As a personal finance expert, he often shares his insights on a range of topics, being featured on leading news outlets including News Corp publications such as the Daily Telegraph and Herald Sun, Fairfax Media publications such as the Australian Financial Review, the Seven Network and more. Bill has over 15 years of experience working in the finance industry and founded Savvy in 2010 with a vision to provide affordable and accessible finance options to all Australians. He has built Savvy from a small asset finance brokerage into a financial comparison website which now attracts close to 2 million Aussies per year and was included in the BRW’s Fast 100 in 2015 as one of the fastest-growing companies in the country. He’s passionate about helping Australians make financially savvy decisions and reviews content across the brand to ensure its accuracy. You can follow Bill on LinkedIn.
Our authors

Fact checked

At Savvy, we are committed to providing accurate information. Our content undergoes a rigorous process of fact-checking before it is published. Learn more about our editorial policy.

At Savvy, our mission is to empower you to make informed financial choices. While we maintain stringent editorial standards, this article may include mentions of products offered by our partners. Here’s how we generate income.

What happens when you want to change mid-policy?

The short answer to this is that it will depend on your insurer. When you first took out your policy they would have given you a document called the product disclosure statement that gives you a detail description of the inclusions and exclusions of your policy. Some insurers will allow you to cancel mid-policy, but you may forfeit your premiums. Other insurers will require that you tell them in writing why you want to cancel your policy and pay back the premiums that you have paid up until that point in time. This could possibly take between 24-48 hours or more to be processed.

Read the terms carefully

Before cancelling your policy, it is vital to read the terms that come with your policy to see if there are any break fees or if you will be able to change policies before its expiration date. Some insurance policies may come with a 14-day cooling-off period that you need to keep in mind.

You may also want to weigh your options whether it would be worth switching your policy by comparing. Make sure to check if the new policy you want to take comes with the same features for a better price. If you are paying more, then check that the features are worth the price. Keep in mind to find an insurer who will be able to cover you for your situation before switching to avoid any disappointments.

What to look out for when choosing a new policy?

  • Will it adequately cover your needs?
  • Can you be able to afford the premiums?
  • Are there any ongoing fees and can I afford them?
  • Will your insurance cover you for pre-existing conditions you may have?
  • Will you be able to increase your cover if need be to cover your loved ones?
  • Is it the best policy that the market has to offer?

Be aware that the insurer can cancel your policy without you requesting

The only time where an insurer will cancel your policy without requesting to do so is if you are in breach of your policy agreement. Before you take on your new policy it is essential to ask your insurer about this to avoid any surprises. This should also be included in the policy disclosure statement. Some of the common circumstances under which your policy will be cancelled are:

  • Not paying your premiums
  • Failing to disclose vital information that has been requested by the insurer
  • Fabricating information
  • You make a fraudulent claim

An insurer will notify you in writing when they plan to cancel your policy. You can also ask them to explain why they are cancelling your policy if you do not understand the written statement that they have given you.

Did you find this page helpful?

Thanks for your feedback!

This guide provides general information and does not consider your individual needs, finances or objectives. We do not make any recommendation or suggestion about which product is best for you based on your specific situation and we do not compare all companies in the market, or all products offered by all companies. It’s always important to consider whether professional financial, legal or taxation advice is appropriate for you before choosing or purchasing a financial product.

The content on our website is produced by experts in the field of finance and reviewed as part of our editorial guidelines. We endeavour to keep all information across our site updated with accurate information.

Savvy is partnered with Compare Club Australia Pty Ltd (AFS representative number 001279036) of Alternative Media Pty Ltd (AFS License number 486326) to provide readers with a variety of life insurance policies to compare. Savvy earns a commission from Compare Club each time a customer buys a life insurance policy via our website. We don’t arrange for products to be purchased from these brands directly, as all purchases are conducted via Compare Club.

Savvy does not compare all life insurance policies or providers currently operating in the market. Any advice presented above or on other pages is general in nature and doesn’t consider your personal or business objectives, needs or finances. It’s always important to consider whether advice is suitable for you before purchasing an insurance policy.

For any further information on the variety of insurers compared by Compare Club or how their business works, you can read their Financial Services Guide.

In this article

Share this article

Share on facebook
Share on twitter
Share on linkedin
Share on email
Share on pinterest

Looking for a life insurance quote?

Compare with Savvy and save on your life insurance purchase.

* Terms and conditions and lending criteria applies.

Smart money saving tips

Subscribe to our newsletter.

By subscribing you agree to our privacy policy

Related articles

Looking for a life insurance cover?

Compare a range of life finance options with Savvy from a panel of reputable insurers.

We'd love to chat, how can we help?

By clicking "Submit", you agree to be contacted by a Savvy broker and to receive communications from Savvy which you can unsubscribe from at any time. Read our Privacy Policy.