If an insurance policy is rescinded, as opposed to canceled or terminated, it will be as if the agreement made between the policyholder and the insurance company was never made. Essentially, instead of canceling the policy midway, the policyholder will go back and start from the beginning, as if they never had the policy. This means the policyholder should get back any premiums they paid to the insurance company. By contrast, when a policy is canceled, the only money refunded is that for the remaining portion of the term.  

Rescission is normally done by the insurance company, and involves:

  • Giving notice of the rescission to the insured
  • Repayment of any premiums

When Can an Insurance Company Rescind a Policy?

Generally, an insurance company can only rescind a policy if the policyholder:

  • Lied in applying for your insurance coverage
  • Concealed information when applying for insurance coverage
  • Made a mistake in applying for coverage that significantly affects the company's position
  • Made a fraudulent claim for benefits

Can I Rescind My Insurance Policy?

Though rescission of a policy is most commonly done by the insurer, this remedy is also available to policyholders. However, rescission by the policy holder is rare, and will generally only be allowed where the insurance company tricked or fraudulently influenced the policyholder into choosing a certain policy. 

Should I Contact an Attorney?

Insurance policies can be extremely complex and difficult to navigate on your own.  If you want to rescind an insurance policy or believe that your insurance policy has been rescinded unlawfully, a business attorney experienced in dealing with insurance companies will be able to fight for your rights.