Can they cancel my coverage at any time?
Canceling coverage is one of those issues where insurance companies differ. If you do not pay your bill, cancellation of coverage is eminent. That is clear. But once you have a claim, then the insurance company will play a different game.
Insurance carrier cannot cancel coverage and tell that that the claim will not be covered. They might deny a claim because it is not in compliance with the policy, but this does not mean that you did not have insurance at the time.
If you have a car accident and make a claim, and the next month you are behind on your payments then guess what? You are covered! You are covered because you had coverage at the time of the accident. This is why is very important to make sure that there is an active policy in force at all times.
If your insurance company is planning to drop you, there are some steps that they need to make sure that they take. They must put you on notice. Enough notice to find some other insurance carrier. This is not always the case and it depends on State law and what your actual policy reads.
Read more about the cancellation of policy clause in your auto insurance policy
