How to Cancel Your USAA Car Insurance Conveniently

Questions: 

• Does USAA charge cancellation fees? 

• What's the best way to cancel my USAA auto insurance? 

• What information will I need to cancel my USAA auto insurance?

What do you call a soldier who survived mustard gas and pepper spray? That's a seasoned veteran -- who, incidentally, also qualifies for auto insurance through USAA.¹ USAA insurance is available to active-duty, honorably discharged, and retired military personnel. But being in that club doesn't guarantee you'll love the service or insurance product USAA delivers. The good news is, you can cancel your USAA insurance anytime with a phone call, and no cancellation fees apply.

USAA Insurance Auto Coverage Cancellation Policy 

There are two ways to cancel your USAA auto insurance policy: by phone or by mail. 

Canceling USAA insurance by phone 

You can call or write in to cancel your policy, though USAA recommends you call (210) 531-8722 and speak to an agent. That agent will ask you a few questions to make sure that cancellation is your best option. It's not necessarily a sales pitch. USAA has gone on record to help its policyholders navigate the financial implications of the coronavirus pandemic with premium refunds and other discount programs. The agent will likely just verify that you're already using the discounts you qualify for and that you have replacement coverage if you need it. 

Canceling USAA insurance by mail 

If you prefer to send a written request to cancel your policy, type up a letter that includes: 

• Your name and birthdate

• Your policy number

• The date you'd like the policy to be canceled 

• Your phone number

• The reason for the cancellation

• Documentation of replacement coverage or documentation that you've sold the car, if applicable 

• Your signature 

You can address that letter to: USAA, 9800 Fredericksburg Road, San Antonio, Texas, 78288. You may get a phone call from an agent anyway to confirm your request. 

USAA Insurance cancellation fees 

USAA does not charge cancellation fees.² If you are canceling the policy prior to its expiration date and you've already paid the premiums for the full policy term, you should be entitled to a pro-rated refund. The only time you might be overcharged is if you forget to cancel the insurance and USAA automatically charges your debit or credit card. In that case, assuming you have replacement coverage, you can contact USAA and ask for your cancellation to be backdated and for the charges to be refunded. You will need proof of the new policy's start date to have the cancellation backdated.³ 

How to Switch from USAA Insurance Auto Coverage to Another Carrier

Canceling your USAA auto insurance and moving to a new carrier can be done in the afternoon if you're organized. Here are the steps to follow.

1. Review your USAA policy details

You can find an overview of your current USAA auto coverage limits and deductibles on the declarations page of your auto policy. If it's been a while since you established the USAA coverage, now's a good time to evaluate your limits relative to your current financial situation. Some questions to ask include:

• Is the car financed? If you recently paid off your car, you no longer have to comply with the lender's minimum coverage requirements. 

• Are my deductibles realistic? High deductibles keep your premiums low, but they can be problematic when you need to file a claim. Check your cash savings to make sure you have enough on hand to cover that deductible if you had an accident. If you don't, plan on lowering your deductible, either with USAA or your new carrier.

• Are my liability and medical bodily injury limits sufficient? Property damage liability and medical bodily injury coverage should be high enough to protect your total net worth. That way, you're less likely to be targeted with a lawsuit for excessive damages. 

The answers to these questions may reveal that tweaks are needed to your coverage limits and deductibles. Write down what you want your limits and deductibles to be going forward. Your next step is to get new quotes for those updated levels.

2. Shop for replacement coverage  

If you have the required information on hand, you can gather up several car insurance quotes in the span of an hour. You'll need your desired coverage levels, plus: 

• Vehicle information: make, model, year, VIN, and purpose for all cars that will be on the policy; purpose refers to whether you drive the car to work, school, or just for pleasure  

• Driver information: driver's license numbers, birthdates, and full names of all drivers who will be on the policy 

• Household information: the address, whether you own or rent, and how long you've lived there 

• Estimate of annual miles driven for all cars 

Collect three to five quotes and compare them on premiums and levels of coverage. Pick your top contender. 

3. Ask USAA to match your lowest quote   

You've called the other guys for quotes; now it's time to give USAA the chance to beat the lowest competing rate. Call USAA at (210) 531-8722. You'll let the agent know you're motivated to lower your auto premiums and that you've already shopped around. The agent will ask some questions to find out if you qualify for any untapped discounts. Your agent might also have suggestions for changing your coverage to lower your costs. You don't want to reduce your coverage from the levels you defined in Step 1 above, but there's no harm in listening to what the agent has to say. Think of it this as more information-gathering to get you to the right solution for your auto coverage. 

4. Start your new policy 

If USAA can't win you back, go ahead and initiate your new policy. Typically, this takes only a few minutes and involves providing a form of payment and any last details the new insurer needs. Once your new auto policy is active, ask for proof of insurance -- this is called a binder. The binder will be like a declarations page, in that it'll list your information and all of your coverages, along with your policy number. 

5. Cancel your USAA auto policy

Once your new coverage is in place, you can call USAA back to request your cancellation. Your USAA agent will ask, again, why you are canceling. You can let the agent know you've already spoken with someone and you're ready to process the termination of coverage. If you've just initiated your new policy, ask that your USAA cancellation be effective the following day.

The agent will probably ask you for one of the following: 

• Proof of your new auto coverage if you live in a state that requires it 

• A bill of sale showing you've sold the car 

The Fastest Way to Cancel Your USAA Auto Policy 

The fastest way to cancel your USAA auto policy is to call an agent at (210) 531-8722 and request an immediate cancellation. If you want your time commitment to be minimal, have your new policy details or a bill of sale showing you've sold the car on hand. Know that the agent may ask you for a signed cancellation letter, which you can mail or email. That letter should include your name, birth date, policy number, and the date you'd like your insurance canceled. 

Before You Cancel Your USAA Insurance Auto Policy

Canceling your auto policy is the right move in three scenarios: 

1. You've found equivalent coverages for less with another, equally capable carrier. Pro tip: Check the customer service ratings on the new carrier, since cheaper premiums can sometimes mean a downgrade in customer service. You'll want to reset your expectations if that's the move you're making.

2. You are moving out of the country.

3. You have sold the insured car. 

If you are putting the car in storage or cutting back on how much you drive, you're better off suspending or reducing your coverage. You can suspend coverage if your carrier allows it and if the car isn't financed. You probably will need to certify to your DMV that the car won't be in use. 

Otherwise, if you don't qualify for a suspension but you don't plan on driving at all, you could drop your coverages down to your state's mandated minimums.

When to Start Your New Auto Policy

You should initiate your new policy the day before you cancel your USAA coverage. The rationale for this is to eliminate the possibility that you'll have a gap in coverage. Coverage gaps can cause your future auto premiums to go up. Auto carriers view the lapse in coverage as a sign that you are a higher-risk driver, and they'll charge you accordingly. 

Although USAA doesn't charge fees for canceling a policy mid-term, you might consider delaying your switch to the new carrier until the day your USAA policy expires. Here's why. If you cancel before the policy expires, you'll probably have overpaid on your USAA premiums. You'll need to wait for USAA to process your cancellation and send your refund. In the meantime, you will have to pay for your new coverage. If that scenario creates a cash flow pinch, you can solve it by waiting until the USAA policy expires. That way, you won't have money tied up in two insurance policies while you're waiting for your refund. 

Cancelling USAA Insurance FAQs

Your history with mustard gas and pepper spray aside, you may have good reason to end your tour as a USAA policyholder. Just get replacement coverage in place first, then you're free to call USAA and have your coverage canceled.