How to Cancel Life Insurance Policy Online or By Mail


There are many reasons why you might need to cancel life insurance such as loans or mortgages being paid off and no longer needing a policy to cover them. Perhaps you thought you found the best insurance policy, but then realized the premium was out of your budget or a financial situation is requiring you to make budget cuts.

Regardless of what your needs are, canceling your life insurance policy is probably easier than you think.

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It can be as simple as not paying the premium or calling your insurance company. You can also cancel your policy online or by mail. The impact of canceling can differ based on how long you’ve had your policy and whether you have term life insurance or whole life insurance.

Let’s look in-depth at how to cancel life insurance and make sure you do it the right way without leaving any money on the table.

What You’ll Need Before You Cancel Your Life Insurance Policy

The number one item you’re going to need before you cancel your life insurance policy is your policy number. The insurance company can locate it when you give them your personal information (name, address, phone number, date of birth), but the process can go much easier with the policy number. Ideally, it would be best to have the policy handy.

If you’re canceling by mail, you’ll need the name and mailing address of the life insurance company. If you’re doing so by phone, you’ll need their phone number, and when canceling online, you’ll need the website address or a policyholder service email address.

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How to Cancel Your Life Insurance Policy Online

If you prefer not to use the mail or speak with a policyholder service representative on the telephone, some companies will structure their website so you can cancel online. However, not all companies offer you this convenience.

The easiest way to cancel online:

  1. Go to your insurance company’s website
  2. Scroll down to the bottom of the home page
  3. Look for a “Contact Us” link or FAQ link
  4. Find the link for their email form or cancellation form
  5. Fill out the form, including the date you want to cancel and your policy number
  6. Request a written response back from them, either by email or by letter

Pretty easy, isn’t it? The challenge can be finding the right links to click on to ultimately get you to the form you’re looking for (it can get frustrating, but stick with it).

Be sure to keep an email folder with all emails you send and receive with your life insurance company. They may come in handy if everything doesn’t go the way you had planned.

How to Cancel Your Life Insurance Policy By Mail

You can always provide a written notice to your insurer that you’d like to cancel via snail mail. It’s recommended that you send it with a USPS option of “Return Receipt Requested” and have someone sign for it at the insurance company. You’ll then have proof that you sent them a cancellation letter.

Here’s an example of a simple letter canceling a life insurance policy:


I’m writing to cancel my life insurance policy, effective DATE. My policy number is POLICY NUMBER. Please return any unused premium or cash value owed to me at ADDRESS.


That’s all there is to it. If you don’t get a response within a reasonable period of time (10 to 14 days), it will be time to pick up the phone and follow up.

While you have an insurance company representative on the phone, you can cancel your policy or at least get the process started by getting any required documents sent your way, like a cancellation form. Have your policy number handy when you call and be sure to document the call, including the full name of the person you spoke with.

Canceling During the Free Look Period

If you immediately regret buying your new life insurance, you have an opportunity to cancel it without cost or penalty: canceling it within the free look period. This is the time immediately following the purchase of a life insurance policy. If you cancel your policy during the free look period, you’ll be refunded in full for any premiums you paid.

The length of the free look period will depend on your insurer and state regulations where you reside, but they’re usually between 10 and 30 days. After the free look period ends, you won’t be refunded any premiums you paid if you cancel your policy.

How to Cancel Your Term Life Insurance Policy

The easiest way to cancel your term life insurance policy is not to pay your premium within the grace period – the 30 or 31 days after the date your premium was due, during which you can delay making your premium payment without losing your coverage. Your insurance will then be canceled, which sounds like a bad thing, but if you want to cancel your term life policy, it’s that simple: just don’t pay.

You can also cancel your term life insurance policy by notifying the insurance company by phone, email, or online – which we covered earlier.

How to Cancel Your Whole Life Policy

Canceling a whole life policy is a bit more complicated than just stopping premium payments, as you can do with your term policy. Each life insurance company has slight differences in their forfeiture rules, but canceling whole life insurance generally starts with a phone call to your insurer.

What happens after that depends on your insurance company’s rules and how long you’ve had the policy. With that said, there are usually three options:

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If possible, cash out the policy

One of the appealing things about whole life insurance is that it accumulates cash value over time. The first few years of your whole life policy is called the “surrender period.” Your policy will specify the exact number of years during this period, but it can be a decade or longer.

If you cancel during the surrender period, the insurance company will keep a percentage of your cash value as a penalty, or they can keep the entire sum if you cancel very early from the date your policy was issued. 

Though your policy’s death benefit isn’t taxable for your beneficiaries, the cash value from a policy you cancel is taxable. Any money you receive will be taxed as ordinary income.

Reduced paid-up option

This option allows you to stop paying your premiums but keep a reduced death benefit on your policy.

The amount of the new face amount is based on your current age when you use the option, the amount of cash value in the policy, and the total premiums you’ve already paid. The new death benefit will most likely be significantly lower than your policy’s original death benefit.

Let it lapse

You’ve got to be careful with this option because when you stop making premium payments, some insurers will automatically cash out your policy, while other insurers will let it lapse. Your insurer may offer the “cash-out” option for your whole life policy, but you may face the same penalties you would have if you surrendered your policy. This is going to depend on how long the policy was in force.

Other types of permanent life insurance, such as universal life, will start using your accumulated cash value to pay your premiums if you stop paying them. This will deplete your payout you’d get from canceling the policy, so letting permanent insurance lapse is usually not the best way to end your coverage.

Frequently Asked Questions 

Now that you know your options on how to cancel your policy, let’s look at some of the most frequently asked questions about canceling your life insurance policy that we haven’t yet addressed:

Can my insurance company cancel my life insurance policy?

Your insurance company can only cancel your policy in two specific instances, which are given in detail in your policy:

  1. Non-payment of premiums. By not paying your premiums within the policy’s grace period (30 or 31 days), your policy will be terminated by the insurance company.
  2. Fraud. There’s a period of time during your policy’s first two years called the “contestability period.” During this time, the insurance company reserves the right to investigate the cause of your death and to cancel your policy without paying the death benefit if they find out that you lied on your application for insurance.

Other than these two reasons, your insurance company can’t cancel your policy, including a change in your health.

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Can I cancel my life insurance policy at any time?

Yes. Term life insurance can be canceled at any time without penalties. If you cancel your whole life insurance policy within the policy’s surrender period, you will incur a penalty which will be subtracted from your policy’s cash value.

Do I get my money back if I cancel my life insurance policy?

When you cancel a term life insurance policy, you don’t get any money back unless you cancel during the free look period, in which case you will get back any premiums you’ve paid. If you cancel your whole life policy, you may receive back some money from the cash value, but you will pay income tax on it.

What happens when I cancel my life insurance policy?

After you’ve officially canceled your life insurance policy, you forfeit any of the premiums you’ve paid for the policy, and your beneficiaries won’t receive the death benefit if you pass away.

Canceling a Life Insurance Policy Online Can Be Easy 

Canceling your life insurance policy can get confusing. The best way to ensure that you do it right is to call your life insurance company and let them talk you through it. Even though they will probably give you other options than canceling your policy, remember you have every right as a consumer to cancel your policy, and cancelation details can be found in the policy itself.


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