Missing a payment on a financed policy is serious, because your insurance is the collateral for the loan. But Texas law gives you warning and time to fix it. Here is the process, and what to do.

1. The payment is late

If a payment is not received by its due date, a late charge may apply as shown on your agreement. Pay as soon as you can — it is the simplest way to stop the process here.

2. Notice of Intent to Cancel

If the payment is still not received, the finance company mails you a Notice of Intent to Cancel, with a copy to your agent. Under Texas law, this notice must give you at least 10 days to pay before the policy can be cancelled. The notice tells you the amount due and the date by which it must be received.

3. Cancellation

If the amount due is not paid by that date, the finance company may send a Notice of Cancellation to the insurance company, which then cancels the policy. For trucking, a cancelled liability policy is also reported to FMCSA, which puts your operating authority at risk.

4. Unearned premium and the balance

After cancellation, the insurance company returns the unearned premium to the finance company, which applies it to your account. Any surplus is refunded to you; if it does not cover the balance, you still owe the difference.

What to do right now

  • Call us at (214) 586-3155 the moment you know a payment will be late. It is much easier to solve before a notice goes out.
  • Pay the amount on the notice, not just one installment — the notice states exactly what stops the cancellation.
  • Keep your contact details current. Notices go to the address on your account; reminders go to your email and phone.
  • Tell your agent. They also get a copy of the notice and can help.

Reinstatement

If a policy has already been cancelled, reinstatement is up to the insurance company, not the finance company. Some will reinstate if the account is brought current quickly; others require a new policy. Ask your agent right away.

Talk to us

Ask your insurance agent to finance your premium with National Premium Finance Company, or get an estimate first. Questions? Call (214) 586-3155 or contact us. Hablamos español.