Can you cancel car insurance bought through instalments?
Yes, you can ask to cancel, even if you are still paying in instalments. But the insurer decides whether you get a refund and how much, and what you still owe the bank or BNPL provider depends on that provider's terms. Cancelling the policy does not cancel your instalment plan by itself.
- The insurer decides the refund, under the insurer's or takaful operator's policy terms.
- Expect less than the unused months. If you cancel, many policies refund using a short-period scale, not a simple pro rata split.
- Your instalment plan is separate. You may need to keep paying until your provider applies the refund.
- Road tax is not refunded by the insurer. It is a separate application to JPJ.
Who does what
| Party | What they decide or do | What you should ask them |
|---|---|---|
| Insurer or takaful operator | Approves the cancellation and calculates any refund under the policy terms | Effective cancellation date and refund amount |
| BJAK | Sends your request, provides forms, follows up and sends you updates | Status of your request and documents needed |
| Bank (EPP) or BNPL provider | Applies any refund to your plan under its own terms and collects remaining instalments | How the refund changes your balance and whether to keep paying |
How to cancel through BJAK
Check your timing
Confirm the cancellation date and arrange replacement cover first, if you still drive the car.
Contact BJAK
Reach the team through Contact BJAK with your policy details and reason, such as selling the car.
Send the documents
You may need ID, policy or certificate details, sale or transfer documents, a cancellation form and bank or payment details.
Wait for the insurer's decision
The insurer approves the cancellation and works out any refund.
Track updates
BJAK sends updates to the contact details on your order. See how to track your refund.
Check with your bank or BNPL provider
Ask them how the refund changes your remaining balance.
Important
BJAK warns that cancelling can affect road tax validity and leave your car without cover.
How refunds work with instalments
The insurer works out the amount
When you cancel, private car policy wordings from AIG and RHB, for example, keep a share of the premium based on a short-period scale for the time already covered. Your insurer's scale may differ.
| Time since cover started | Refund of total premium (AIG and RHB example) |
|---|---|
| Up to 1 week | 87.5% |
| Up to 1 month | 75% |
| Up to 3 months | 50% |
| Up to 6 months | 25% |
| Up to 8 months | 12.5% |
| More than 8 months | No refund |
Where the money goes
If you cancel an insurance policy purchased through EPP or BNPL, BJAK will process the applicable prorated refund. The refund is intended to help you settle your outstanding instalments with your bank or BNPL provider. You should continue following the provider's repayment terms and confirm how the refund is handled for your particular payment arrangement. See how do I request a refund.
Keep paying until it is settled
Your plan keeps running until the provider applies the refund. A short-period refund can be smaller than your remaining balance, so you may still owe money.
- SPayLater: if the refund comes back through SPayLater, the bill for that amount is waived. If it is refunded another way, you still pay the SPayLater bill in full.
- GrabPayLater: a refund is applied to your next unpaid bills, and you still pay any remaining bills on time. Interest already paid is not returned.
- EPP on a credit card: Maybank's EzyPay terms, for example, say you keep paying monthly instalments in a merchant dispute and settle any balance if the plan ends early.
- Atome: a full refund may cancel your remaining instalments, while a partial refund may reduce upcoming payments or be credited to your linked card. Any applicable instalment fees may not be refundable.
- AhaPay: you remain responsible for your payments until the refund is processed. AhaPay may deduct the refund from your outstanding instalments, and some service fees may not be refunded.
Good to know
BJAK says provider terms can change the final amount. See is there a refund-processing fee.
What can reduce or stop a refund
- A claim on the policy. AIG and RHB wordings give no refund if a claim has been made.
- Minimum premium only. The same wordings give no refund if you paid only the minimum premium.
- Time used. The example scale gives nothing after 8 months.
- Provider charges. Instalment fees or interest you have paid may not come back.
Frequently asked questions
Do not assume so. BJAK's guide on how to cancel car insurance says a 15-day cooling-off period should not be assumed. Even week one returns 87.5% under the example scale.
Not from the insurer. You apply to JPJ with Form JPJ K6. Read road tax refund when you sell or deregister a car.
That is a different case. BJAK refunds unsuccessful orders without a processing fee. See how long a refund takes.
Cancel with the full picture
Check the insurer's refund, your plan balance and your road tax before you cancel. Find more answers in the BJAK Trust Centre under Your payment and money.
- Last reviewed:
- 11 Nov 2026
- Reviewed by:
- Finance, Compliance
- Next review:
- 1 Jan 2027