What are the things you need to know about your car insurance?


One important tip you can use before you sign up for auto insurance is that you need to know all the smallest details about the company and the policy you prefer. Sometimes just by reading the terms and conditions (more importantly, the fine print), you can already learn a lot about your coverage.  But this can be pretty tedious especially if the TOC is 10 pages long. To help you in understanding your auto insurance policy, we have answered some of the questions you may have.

What should be the next step I should take if my policy gets cancelled?

When you receive a notice from you provider stating that they are cancelling your policy, you need to know the reason for such an action. More often, it is because you failed to pay your premium on time, or it could be due to non-payment for several months. Hence, to address this, you need to make payments before the cancellation of your policy gets completed. But in the event that you are not aware of the cancellation or you have the feeling that the action done is illegal, and then it is best to get a legal consult. To avoid conflict, make sure that you have acted on the issue before the cancellation date stated in the note.

Should my provider inform me regarding the cancellation of my policy?

Yes, as a matter of fact, it is a legal requirement. It is not really just about keeping up with the law but with ethics as well. It your right as a policy holder to know whatever action is taken regarding your policy. The standard time frame for a provider to inform its client is at least twenty days before the date of cancellation becomes effective. The insurance company is also required to disclose the reasons why a policy can get cancelled.

Who should shoulder the storage expenses of a disputed damaged car?

Such expenses should be paid by the insurance provider until things are settled. A policyholder can file a complaint should his provider ask him to shoulder the storage charges. To do so, you need to submit a written complaint to the Insurance Division so as proper action can be taken.  The process of solving the dispute will be based on the agreements which are included in the policy.

Is it a requirement to make down payments when policy is renewed or purchased?

While this is standard operating procedure for most insurance companies, it is not a requirement for all. Down payments depend on the insurance company’s policies. While there are some providers who would ask you to pay up to 30% down payment upon renewal, there are others who are more lenient and would allow their customers to make installment payments. Aside from a monthly term, there are other payment options that your insurance provider can offer, particularly if you’ve been with them for several years.