Finance glossary
Cooling-off Period
Also known as: Right to cancel, Right to withdraw
In simple terms
A cooling-off period is a short window after you take out a financial product in which you can change your mind and cancel, usually without penalty. For many products it is 14 days.
On this page
What does cooling-off period mean?
A cooling-off period is a legal right to cancel certain contracts within a set time after you agree to them, giving you a chance to reconsider without being locked in. It is sometimes called the right to cancel or the right to withdraw.
It commonly applies to products bought at a distance (online or by phone), off-premises, and to many regulated insurance and credit agreements. The exact rules and length depend on the product.
How a cooling-off period works
For many financial products the period is 14 days — for example, distance contracts, general insurance, and the right to withdraw from most regulated credit agreements. For life insurance and personal pensions it is typically 30 days. Periods vary, so always check your paperwork.
To cancel, you normally tell the provider within the window. You may still owe interest for any days you actually had a loan, or a proportion of an insurance premium for cover you had — but you should not face unfair penalties for cancelling within the period.
How could this affect me?
A cooling-off period is a safety net if you buy in haste, are pressured, or spot a better deal — you can usually walk away cleanly if you act quickly.
Do not assume every product has one, or that the length is the same. Read the cancellation terms when you sign up, and if you want to cancel, do it in writing and keep a record.
Things to watch out for
- Periods vary — commonly 14 days, but 30 days for life insurance and pensions, and some products have none.
- You may still owe interest for days you held a loan, or a share of an insurance premium for cover you used.
- The clock usually starts from the contract date or when you receive the terms — check which applies.
- Cancelling in writing and keeping proof avoids disputes about whether you cancelled in time.
Know your rights
- Many regulated credit agreements carry a 14-day right to withdraw under the Consumer Credit Act 1974.
- Distance and off-premises financial contracts, and most general insurance, typically have a 14-day cancellation right.
- Life insurance and personal pensions typically carry a 30-day cancellation period.
- If a firm refuses a valid cancellation, you can complain and escalate to the Financial Ombudsman Service.
General information, not personal advice
Consumer Credit is an independent information service. We do not provide regulated financial advice or sell financial products. For advice on your own situation, speak to an appropriately authorised firm or a free service such as MoneyHelper. About Consumer Credit.
Sources
We checked this page against these official and authoritative sources.
- legislation.gov.uk, Consumer Credit Act 1974 — right to withdraw (s.66A) (opens in a new tab). Accessed 22 Aug 2026.
- MoneyHelper, Cancelling a financial product and cooling-off periods (opens in a new tab). Accessed 22 Aug 2026.