Can an insurance company sue for an unpaid premium on a cancelled policy with no claims against it?

UPDATED: Nov 8, 2011

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UPDATED: Nov 8, 2011Fact Checked

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Jeffrey Johnson

Insurance Lawyer

Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

Insurance Lawyer

UPDATED: Nov 8, 2011

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about legal topics and insurance. Our goal is to be an objective, third-party resource for everything legal and insurance related. We update our site regularly, and all content is reviewed by experts.

UPDATED: Nov 8, 2011

Advertiser Disclosure

It’s all about you. We want to help you make the right legal decisions.

We strive to help you make confident insurance and legal decisions. Finding trusted and reliable insurance quotes and legal advice should be easy. This doesn’t influence our content. Our opinions are our own.

UPDATED: Nov 8, 2011Fact Checked

Insurance policies are a contract between you or your company and the insurance company. You agree to pay a specified premium in exchange for protection against certain losses, whether they be auto or property insurance. The insurance company is required to notify you within a certain period of time before the expiration date if they intend to cancel or nonrenew your insurance policy. That does not void the current contract or policy and the coverage is intended to remain as written until the expiration date.Your failure to make the payment due on the policy is a breaking of the contract. The policy was still in force and if there were a loss it would have been paid. The fact that there was no loss does not mean you do not owe the premium.If you closed your business prior to the cancellation of the policy, you can ask the company to cancel the policy as of that date. If not, then the company does have to right to seek payment for the earned premium, including collection proceedings.

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Jeffrey Johnson

Insurance Lawyer

Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

Insurance Lawyer

Editorial Guidelines: We are a free online resource for anyone interested in learning more about legal topics and insurance. Our goal is to be an objective, third-party resource for everything legal and insurance related. We update our site regularly, and all content is reviewed by experts.

Free Insurance Quote Comparison

Enter your ZIP code below to compare cheap insurance rates.

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